Justifying the forced closure of the Serious Fraud Office’s inquiry into corruption in a Saudi arms deal to buy 72 Eurofighter jets from BAE Systems, Tony Blair spoke as an old-fashioned realist. Nations have interests; those strategic interests are paramount. “Our relationship with Saudi Arabia is vitally important for our country.”

So what price now for foreign policy with an ethical dimension? I wrote a short book last year in which I argued for the PM’s interventionist foreign policies. The principal flaw in them seemed to me not the challenge to autocratic states, but the absence of a sense of priorities in making that challenge. Promoting democratic change in Syria, for instance, is more urgent than in North Korea, which is totalitarian and bellicose but not expansionist.

Our overriding foreign policy goal is the defeat of aggressive terrorism. So pursuing an inquiry into corruption in an arms deal worth billions of pounds would risk disrupting a relationship with Saudi Arabia crucial to achieving those goals. Mr Blair placed emphasis on the national interest in vague terms so we have no idea what the interests are, because he did not say. The tacit assumption must be that the Saudis might withhold intelligence co-operation, and withdraw from the arms deal. Our security interests would suffer; so would British commercial interests.

This is not only the best defence but also the only conceivable one for a decision taken directly by the Prime Minister. Unfortunately, it is pitiful. The lamentable closure of the SFO inquiry encapsulates the method and reasoning of the banana republic. It jettisons the central principle of democratic government. The SFO said this week that: “It has been necessary to balance the need to maintain the rule of law against the wider public interest.” To say that this is illiberal scarcely covers it. It is the lowest point in Mr Blair’s Government, and will be a defining one. It gives cynicism a bad name.

Over the past quarter century democratic governments have generally sought to subordinate discretionary policy to a framework of rules. This is the way monetary policy now works. Interest rates are no longer set by politicians. There is a stated inflation target, and an independent body is charged with meeting it. Likewise,the international system of trade and payments operates increasingly on similar principles. The World Trade Organisation is widely seen by anti-globalisers as a means of entrenching the privileges of the rich world. The opposite is true: a system of rules applying to all member states means that economically stronger countries cannot discriminate against foreign producers and in favour of their own vested interests. It is a way of subordinating potential conflict to the rule of law.

A rules-based system ought, over the long run, to be a more efficient form of governance, as well as a freer one, because it makes policy more predictable and allows private citizens to get on with their lives without an overbearing government. The principal lacuna in the creation of a rules-based system is, however, that in relations between states there is no ultimate sovereign authority that can implement the decisions of the international community. It is possible that Mr Blair has this in mind when he elevates the national interest to a principle higher than the rule of law. It is certainly the justification of his belief in humanitarian intervention against oppressive states.

But that reservation has no place in the practice of domestic government. The rule of law must run because it serves our interests best over the long run, even if in particular cases — say the workers of BAE — there are individual losers. A society in which the rule of law may be dispensed with if it runs counter to government objectives is a terrible precedent. Worse governments than Mr Blair’s will turn to it.

The irony is that it runs counter also to Mr Blair’s stated foreign policy aims. Saudi Arabia is not so much a state as a fiefdom. Single-family rule is a bizarre anachronism, but this ruling family largely owns the country as well as governing it. The family has stolen vast sums from the country’s wealth. The spending habits of the House of Saud is an inevitable source of popular discontent.

The Saudis therefore clearly encourage an aggressive Islamist ideology, Wahhabism, to divert political dissent into the mosque and then outward to the world. There could scarcely be a more effective way of incubating the forces of fanaticism that threaten us, and the Saudis too. Pressing for political reform in Saudi Arabia is urgent. Mr Blair is not pursuing that course, but instead is acquiescing in corruption for reasons of state. It is an unprincipled decision, but worse, it is a stupid one.

Oliver Kamm is the author of Anti-Totalitarianism: The Left-wing Case for a Neoconservative Foreign Policy

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