On Thursday evening I attended a standing-room-only meeting of my constituency Lib Dem association to hear Michael Moore – MP for Berwickshire, Roxburgh and Selkirk – explain the Lib-Con coalition to the faithful.

There were some of the old war horses who had, over the decades, through two boundary changes, helped me grab the seat from the Tories in the 1965 byelection; survived three recounts after I had opposed the visit of the apartheid Springbok rugby team to the rugby-religious Scottish Borders; swallowed both the Lib-Lab pact, and the alliance and then union with the SDP; and lots of new faces unfamiliar to me during my four-year abstention from party politics while presiding over the Scottish Parliament.

Now, after all that, here they were full of questions, doubts and anxieties. One man said he had got out his scissors to cut up his membership card but came to the meeting instead. I was so proud of them because the questions, doubts and anxieties were almost all ones I shared. We all had an instinctive horror of collaboration with the enemy. Michael patiently detailed the events of the past few days.

In my view we have to ponder three truths:

1. The economy is in a parlous state and throughout the election we had stressed the need to act responsibly in the national interest. How could we fail to do so now?

2. The possibility of a progressive coalition, which flamed briefly following the dignified resignation of Gordon Brown as Labour leader, was denied us not by the arithmetic (a Lib-Lab coalition required merely the acquiescence, not the support of the minor parties) but by the tribalism of the Labour party. The views of Peter Mandelson, Peter Hain, Roy Hattersley and Andrew Adonis were roundly and publicly rejected by the voices of John Reid, David Blunkett and others who clearly spoke for the majority with the battle cry: "Go back to your constituencies and prepare for opposition." Labour had scuppered any such project, not us.

3. We have successfully injected parts of the Lib Dem manifesto into the government programme and outlawed parts of the Tory manifesto, most notably bringing tax reductions to the poor rather than the rich and allowing the electorate itself to improve the voting system in future elections.

As I said at the end of the meeting, Nick Clegg had only one other option as leader – to sit in opposition, watch a minority Tory government struggling with declining sterling and share indices, head for a second election in the autumn armed with buckets of Ashcroft-type cash and annihilate our party as useless hand-wringing debaters. We have not only to hope this coalition works – we have got to make damn sure it does.

Lord Steel was leader of the Liberal party, 1976-88