A Socialist government in Madrid could also make it harder for Mr Blair to win his battle for economic reform in

A Socialist government in Madrid could also make it harder for Mr Blair to win his battle for economic reform in Europe, a prerequisite for British membership of the euro. Spain will now instinctively link hands with France and Germany rather than Britain, perhaps making it harder for Mr Blair to cement a new three-way partnership with the two nations that drive the EU engine.The Spanish election might also improve the prospects of a breakthrough on the stalled EU constitution, which saw Spain and Poland pitted against France and Germany in a row over voting rights. But they will have a lot to talk about when they meet in the next six weeks. Mr Zapatero’s pledge to pull Spanish troops out of Iraq gives Mr Blair another post-war problem. His election has also changed the delicate balance between Old and New Europe, just when Britain was hoping the wind would blow its way with 10 new members joining the EU club in May. So there is little wonder that the issue of trust is regarded in Downing Street as the biggest threat to Mr Blair.Yesterday the Prime Minister held what No 10 called a “warm and friendly” 15-minute telephone call with his new Spanish counterpart. People might have believed a “things are getting better” message from Mr Blair in 1999, but they might not buy it today.Similarly, will the voters trust a pledge from the Prime Minister that he will not raise taxes if he wins a third term? This is exercising minds at the Treasury.

On Saturday, Mr Blair tried in another speech to talk up a “feel-good factor” about public services, contrasting what he called people’s personal optimism with the mood of national pessimism. The Blairites will argue, with some justification, that “they would say that, wouldn’t they?” But the MPs’ warnings may well strike a chord with the public.More serious is what Alastair Campbell called “this huge stuff about trust” in his diaries, disclosed to the Hutton inquiry. It is not only that people will not trust what Mr Blair told them about Iraq but that a general corrosion sets in and they don’t believe him on anything.Take public services. It is his nightmare scenario.It explains his utter determination to tackle the threats of rogue states and international terrorism, which aides say pre-dated the attacks in the US in September 2001. The Prime Minister believes he would be failing in his duty if he did not act on intelligence about terrorist threats. He reflected on his acute dilemma in the same speech, asking persuasively: “Would you prefer us to act, even if it turns out to be wrong? Or not to act and hope it’s OK? Suppose we don’t act and it turns out to be right? How forgiving will people be?”His allies feel that Mr Blair cannot win. Labour opponents of military intervention in Iraq are already warning that the lesson of Madrid is that the war has made London a terrorist target.

Even if Britain manages to keep al-Qa’ida at bay, the defeat of Mr Aznar’s party delivers a chilling political message to Labour in Britain.By supporting the Iraq war and blaming Eta for last week’s outrage, Mr Aznar lost the trust of the Spanish people. Mr Blair already has a trust problem over Iraq, caused largely by the failure to find weapons of mass destruction in that country. The fear in Labour circles is that the terrible events in Madrid will compound it.The parallels are not exact In Spain, nine out of 10 people opposed the war In Britain, opinion was more evenly divided But the similarities cannot be discounted. In his speech two weeks ago re-arguing the case for war from first principles, Mr Blair urged his critics not to question his integrity but accepted they could question his judgement. The unspoken worry in Downing Street is that people will now question both.Mr Blair has always been haunted by the threat of a terrorist attack in London.