“If you just set out to be liked,” Margaret Thatcher once said, “you would be prepared to compromise on anything at any time, and you would achieve nothing.”

Love or hate the Iron Lady, two things are true. Firstly, it was a dictum she put into practice during her time in power; and secondly, she was in power a very long time.

To her supporters, Baroness Thatcher transformed Britain from being the 'sick man of Europe' to a global financial capital. She took a bloated, top-down economy and created an entrepreneurial culture based on low taxation, low public spending and private, rather than public, ownership of national assets.

To her critics, she was a hugely divisive influence who sparked mass unemployment, destroyed industry and doubled the poverty rate.

For good or bad, then, she utterly transformed Britain during 11 years as prime minister – and was rewarded by being re-elected twice.

Tony Blair was another who understood the importance of momentum and the grand narrative of politics. The radical tone was set early in New Labour's first term: significant constitutional changes, including devolution to Scotland, Wales and Northern Ireland and an elected London mayor; a national minimum wage; signing up to the Human Rights Act; helping bring about the Good Friday Agreement.

Then, in the second term, a huge increase in public spending in health and education accompanied by new policies designed to give parents and patients more choice. To what extent Mr Blair succeeded in defining a 'Third Way' of prosperous social democracy is open to debate. Supporters say he rebuilt what Baroness Thatcher destroyed; critics say he wasted money inherited from a financial-sector led boom. Either way he, like his famous predecessor, led a government defined by what it did.

Compare, if you will, the premiership of Gordon Brown. He was – it is easy to forget - prime minister for nearly three years. He was hugely popular at the start of his time in Number 10, and won plaudits across the world for the way he dealt with the global financial crisis. And yet he was turfed out by the British people at the 2010 general election.

There are, of course, many reasons for this. But here's something to consider. Can you name a single domestic policy that Mr Brown was responsible for after becoming prime minister in 2007? If you are scratching your head, you are not alone. His government seemed in a permanent state of paralysis. Reviews were carried out, white and green papers drawn up, bold ideas put forward, brainstormed, agonised over. And then? Nothing.

What prevented Mr Brown from acting decisively, in terms of domestic policy, was a fear that he might get it wrong; a fear he might do something so unpopular that there would be no way back. For Baroness Thatcher this had been the Poll Tax. For Mr Blair, ultimately if not immediately, it was Iraq.

Mr Brown, despite his formidable learning, failed to read between the lines of political history. Bad policies may sometimes bring a prime minister down. But a complete absence of policy, a sense that a government is simply drifting on, without principle or purpose: that is always fatal. Governments, like sharks, either keep moving or die.

David Cameron should be wary of this as his coalition moves into the New Year. The prime minister was in Salford last week to announce what was billed as a 'major' announcement on health. When it came, it was rather underwhelming: a call for the return of matrons in all hospital wards, and nurses told to perform hourly rounds. When pushed on the new policy, Mr Cameron denied it was a question of setting new top-down targets for hospital staff. But if there are no targets, and no enforcement, then what is the point of the policy?

Mr Cameron is in a difficult position. Coalition government and radicalism do not naturally go hand-in-hand. Moreover the Liberal Democrats – still flat-lining in the polls – have shown recently they are perfectly prepared to put then handbrake on anything they feel will hurt their prospects.

Then there is the question of his cabinet. There are no shortage of laws and policy being put forward by Tory ministers; it is just that a lot of them either lack focus, or are simply bad. It wasn't just the Lib Dems who objected to large parts of Andrew Lansley's Health Bill. And then there have been a string of embarrassing u-turns on everything from selling off Britain's forests, to school sports funding.

As yet, then, in terms of domestic policy, there has been nothing to define Mr Cameron's premiership; nothing, that is, other than huge spending cuts and the rather amorphous idea of a 'Big Society' rushing in to fill the gap. Of course the prime minister can't be entirely blamed for this. The economic crisis is demanding a huge amount of his time and energy, and any government needs a wide range of talented people to function well. Still, it's hard to imagine it happening under Mr Blair – and still less under Baroness Thatcher.

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