Mad monk's new creed

Keith Joseph was fond of quoting these lines from a now-forgotten poet, Alfred O'Shaughnessy: "One man with a dream, at pleasure/ Shall go forth and conquer a crown,/ And three with a new song's measure/ Can trample a kingdom down."

Joseph both trampled a kingdom down, the kingdom of statism inherited from the war years, and conquered a crown, by helping to create a society based on the tenets of economic liberalism. Dismissed by Lord Hailsham as "dotty", by Reginald Maudling as being "nutty as a fruitcake", by Ian Gilmour as a "Rolls-Royce brain without a chauffeur", and by Harold Macmillan as "the only boring Jew I've ever met", Joseph achieved more than any of them. He was indeed one of the most influential politicians of the 20th century. But his influence, like that of Joe Chamberlain, Enoch Powell and Tony Benn, lay more in what he said than in what he did. He was a man of ideas, or perhaps of just one idea.

Chamberlain, Powell and Benn struggled, albeit unsuccessfully, to gain the premiership. Joseph, by contrast, rejected the chance of becoming leader of his party in 1974-75, saying, in words one cannot imagine any other serious politician using, "it would have been a disaster for the party, country and me".

The same self-deprecation prevented him from writing his memoirs. It has been left, therefore, to two young politics lecturers, Andrew Denham and Mark Garnett, to fill this important historiographical gap. They have done so triumphantly. Their biography, based on a wide range of primary sources, including the private papers of Joseph himself, Edward Heath and Hailsham, is a beautifully proportioned work, sound in its judgements and psychologically acute. It constitutes a major contribution to contemporary history, one of the best biographies indeed of recent years.

Joseph, like Chamberlain, Powell and Benn, underwent a political conversion in mid-career. "It was only in April 1974," he said, "that I was converted to conservatism." The role of the state, he had at last come to understand, was not to resolve social and economic problems, but to provide a framework through which individual enterprise and community spirit could be brought into play. It was this leitmotif that provided the Conservatives with something they had not enjoyed since the days of Chamberlain: intellectual self-confidence, a conviction that the left could be defeated on the battleground of ideas.

Like many men of ideas, Joseph proved an unsuccessful minister. As education secretary between 1981 and 1986, the longest tenure since the war, he was a disaster. His green paper of 1985, "The Development of Higher Education into the 1990s", proposing an appraisal system to measure the relative quality of research output, helped to create a "publish-or-perish" culture, and is the fons et origo of the barbarism currently afflicting Britain's universities. Eric Heffer, the left-wing MP for Liverpool, Walton, accused Joseph in the Commons of philistinism in assuming that higher education should be evaluated in terms of its contribution to economic performance. MPs were thus treated to the spectacle of a fellow of All Souls being roundly and appropriately rebuked for his lack of understanding of education by a man who had left school at 14. On Joseph's retirement, The Jewish Chronicle lamented that he had not brought to his post "a fraction of traditional Jewish respect for teachers and for learning, of Jewish intellectual humility and flexibility", a verdict that must have troubled a man who, for all the outward appearance of assimilation, remained stubbornly tenacious about his Jewishness.

Keith Joseph is crucial to an understanding not only of Thatcherism but also of the rise of new Labour, itself a product of the consensus that Joseph, more than anyone else, helped to create. Joseph had sought to construct a new "common ground", based on the market economy, and in this, his fundamental aim, he did not fail. By 1997, Labour, for the first time in its history, no longer called for an extension of state control, and the general election of that year was a clash of personalities rather than ideas. Thus Joseph's heirs were not only Margaret Thatcher and Geoffrey Howe, but also Tony Blair and Gordon Brown. For new Labour sought, as Joseph had done, to marry economic efficiency with social compassion. Yet Blair and Brown have done no better than Joseph in resolving the conundrum of how a dynamic economy can be reconciled with social stability and community feeling. Perhaps there is no solution, and we will have to learn to live with the social dislocation that the market economy has brought in its train. What is indisputable is that we still inhabit a world largely created by Joseph, and we will probably continue to do so for a long time to come.

Vernon Bogdanor is professor of government, University of Oxford.