Most things in politics are relative. Britain’s economy has spluttered into life. After years of unremitting misery, the signs of an upturn are hailed by the government as a wondrous feat. Yet the country is still burdened by deficits and debt, and output is below the levels of 2007. Austerity, the Treasury intones, has many more years to run.

The nation’s politicians are returning to Westminster after their annual around-Britain caravan of party conferences. The myriad speeches, promises and insults hurled at opponents have shown them to be bereft of ideas. I am struck by a parallel with the euro: the crisis has subsided, but no one knows where it is heading next.

Cameron’s Conservatives have been cheered by the run of better economic news, but the electoral arithmetic says they will struggle mightily in 2015 to win the overall majority that would set them free from their Liberal Democrat coalition partners. The Tories scored about 35 per cent in the 2010 election. To govern alone requires them to get 40 per cent or so - and that after five years of falling living standards.

There is only limited cheer in Cameron’s predicament for Ed Miliband. True, the curiosities of the electoral system mean the Labour leader could win office with a smaller share of the vote, perhaps as little as 35 per cent. Miliband, though, lacks the bearing of a plausible prime-minister-in-waiting. Invite his colleagues to frame their leader in the doorway of 10 Downing Street and some visibly wince.

The German chancellor Angela Merkel’s third successive victory was a reminder that elections tend to be won by those who command the centre. This lesson has been lost on the Tea Party Republicans whose fatwa against President Barack Obama is likely to cost them another presidential election in 2016.

Strangely, in Britain, both the Conservatives and Labour are also fleeing the middle ground. Cameron’s problem is his party; Labour’s Achilles heel is its leader.

Ask voters to put themselves on a spectrum from right to left and the great majority crowd towards the halfway mark. The trick is then to ask them to place the politicians on the same spectrum. Tony Blair, the former prime minister, always aimed to end up dead centre. The evidence of three election victories suggests this was not a bad strategy. Winning comes first. Leaders with the confidence to make the political weather can then change perceptions of where the centre lies. Margaret Thatcher shifted it to the right; Blair to the left.

Cameron once understood this. He was a self-styled moderniser - the Tory “heir to Blair” who cared about the poor, took climate change seriously and embraced social liberalism. And now? His speech the other day suggests he still sees himself as a moderate, but the resonant tunes of the conference were those that once won Tories the sobriquet of the “nasty” party.

The Conservatives have embraced the politics of pessimism. They are at war with modernity. Lynton Crosby, the party’s campaign chief, hails from a school that says politicians define themselves against the enemy. The Tories have plenty: welfare recipients are scroungers, immigrants a threat to national identity, and the EU a dastardly plot to rob Britain of its nationhood.

Rebellion against the leadership has become routine in a party assailed on its right flank by the xenophobic populism of the UK Independence party. Tory MPs want a strategy to collect the party’s core vote rather than a pitch for undecideds. For his part, Cameron is weakened by an absence of firm conviction. He seems to think it enough for a prime minister to look persuasive in the part.

Miliband could have seized the chance to claim the territory vacated by the Conservatives. Instead, while a featherweight prime minister has been blown rightward, the leader of the opposition has strolled leftward. His role model seems to be Francois Hollande. Didn’t the French president win power from the left? Labour can surely do the same.

The snag is that France, where the communists can still claim a respectable following, is not Britain. In any event, Hollande’s present troubles, alongside Merkel’s success, scarcely underscore the Labour case that the economic crisis has turned Europe’s political tide in favour of parties of the left.

Miliband’s desire for social justice is sincere enough. He is correct too in drawing a distinction between capitalism and the market economy: the first is easily corrupted, the second the best we have. What’s missing is a credible account of where and how he would strike the balance between market economics and social equity. In its place are the politics of daydreaming, based on the hope that enough voters will desert Nick Clegg’s Lib Dems to take Labour over the line.

In other times, Clegg’s party would be the natural beneficiary of this political flight from the middle ground. He makes a convincing pitch that Lib Dems can anchor Labour to the centre or pull back the Tories from the right. His party may well do better than its present, dire poll ratings suggest. But it has lost the many Lib Dem voters who disdain the compromises of coalition. If Clegg emerges again as kingmaker, most likely it will be by default.

Travelling abroad, I am often asked who will win in 2015. My answer is no one - and certainly not Britain. Things could change. But, viewed from a distance, Britain is a diminished power buffeted by events and heading, with its eyes shut, towards a calamitous exit from the EU. Close up, the nation’s politics scarcely challenge such impressions.

Financial Times.