Downing Street is Obsessed With the Kelly Affair

So Tony Blair spent the whole of last weekend with the lawyers, did he? The diary has been cleared, they say. We are invited to imagine Blair closeted at Chequers, knee-high in old emails and minutes, thinking only about what he will say to Lord Hutton this morning.

If so, it is hard to know whether to laugh or to cry. Laugh, because so little of this picture accords with how Blair has actually spent his previous six summers as prime minister. Cry, because the more we have learned about the inner workings of the highest levels of Britain's government over the past few weeks, the more depressingly plausible such a study in obsession may actually be.

Normally - if such a word has any meaning in describing a modern prime minister's life - Blair makes a rather sensible use of his summer holidays. He uses them, in other words, as you or I might imagine he would. First, obviously enough, to get as much of a break as his job permits - which in truth is not very much. But also, coming a close second, to reflect at greater depth than is possible the rest of the year about where his government has got to, and how he intends to address its current problems when he returns.

Judged by past experience, therefore, Blair would have had a very challenging time in Barbados this year, irrespective of the Hutton inquiry. At the heart of his ruminations, as ever, will have been a strategic political stocktaking, dominated, in particular, by work on what he will say in his defining annual speech to the Labour conference, now just a month away. Problems enough for any leader, especially this year.

Yet, as Hutton has unfolded, the plausibility of this serene and idealised scenario has become less and less credible by the day. For the inquiry's unprecedented volume of documents and testimony paint a picture that one would otherwise have barely believed - a picture of an entire governmental machine psychologically enslaved by the obsession of winning its battle with the media over the fallout from the Iraq war.

A small note of sensible caution is in order here. We don't yet actually know how much time and energy Blair himself - as distinct from his various colleagues and minions - spent on these matters. But obsession can be contagious.

Because Blair is who he is, every reference to him at the inquiry has been pored over and examined in magnified detail, sometimes extravagantly so. But the evidence, including Geoff Hoon's, has not yet placed Blair himself at many meetings that discussed the Iraq dossier, Andrew Gilligan's broadcasts or what to do about Dr David Kelly. Blair himself has not left much of a paper trail - not least because, like Alastair Campbell, he is computer illiterate. Strange but true.

The picture of Blair's role that emerges from the evidence of his praetorian guard - Campbell, Jonathan Powell, David Manning and John Scarlett - has mostly had the prime minister at one remove. This is what, on one level, one might expect and might even hope. But in the context of what Campbell and the others have revealed, it is becoming increasingly counter-intuitive.

Everyone else in the entourage, it certainly seems, was on a war footing against the Today programme. The microscopic focus on Gilligan and Kelly elsewhere in the bunker, now laid bare before Hutton, beggars belief. The number of people involved, right up to Campbell's pay grade, and the extent of their involvement, is truly breathtaking. In June and July, Downing Street truly seems to have been in the grip of a collective mania. Such mass distraction of the governing class makes one's jaw drop.

That is why, in the face of the Hutton evidence so far, it becomes increasingly difficult to imagine Blair not being as engaged as the rest of them. Downing Street is a small place. Everyone's room is close to everyone else's. Blair does not shut himself away from his team. People swap news and views continually.

So while Blair undoubtedly spent a lot of his time doing other things during the episodes that Hutton is examining, it is difficult to believe that he could be aloof - or that he sought to be - from the intensity swirling around him. Such a possibility simply does not ring true.

In which case, one really does fear the worst. Not because Blair has a proverbial smoking gun in his hand. But because he and his closest advisers seem to have allowed themselves to become caught up in a series of secondary issues, when there is so much else to which they should be directing their attention.

If ever Blair needed to use a summer to reflect on the position and future direction of his government, this was it. If ever he has needed to listen carefully and without pride to his critical supporters, this has been the time. If ever he has needed to rethink his strategy and priorities, these are the days to do it.

The Blair government is at a crossroads. In one direction lies the only realistic goal that a forward-thinking political movement ought to have: a deliverable programme of progressive good government that is recognised as principled and effective by friend and sceptic alike. In the other direction lies the irretrievable disenchantment both of its core supporters and of its equally important floating backers. At the moment the government is sliding rapidly towards this latter path. The collapse of its euro strategy is a conspicuous casualty, but there will be others.

The temptation on the left is to say that this crisis can only be solved by very radical alternatives to Blairism. Not true, and nothing would steel Blair more against altering his course than such an approach. That is why the real challenge is to construct a better Blairism.

So here are four things that Blair can do in the coming weeks that are both consistent with his goals and his past approach, which could all be done now, and which would collectively go a long way towards restoring his political position.

One: make Britain a real bridge between the US and the rest of the world in promoting a genuinely international-based UN-led strategy for the problems of postwar Iraq and its region.

Two: show the Labour party, and the unions in particular, that public service reform programmes involve no undercutting of the pay and standards of the existing workforce.

Three: reconnect with middle-class Britain - and offer a hand to the Labour MPs who represent it - by stopping the sleepwalk to electoral disaster embodied in tuition fees.

Four: wipe the slate clean with the media and the voters by putting the whole spin culture out to grass (but don't announce it in public, or else you will be accused of spinning the death of spin).

In the past, Blair would have spent the summer thinking about these and other strategic ideas. Perhaps in reality that was what he did again in Barbados. But if all that he thought about was Hutton, or if he thinks that what he says today holds the key to his government's future, then he - and we - really are in trouble.