The Macmillan Diaries: the Cabinet years 1950-1957 by Edited by Peter Catterall

This vivid, readable, engrossing book contains the confidential diaries of Harold Macmillan covering the years before he became Prime Minister in 1957. It has had a troubled birth. Several months ago, the publishers recalled an earlier version. It is alleged to have libelled someone whose identity columnists have been guessing wildly. The book now on sale has evidently been hastily re-set: many entries in the index are inaccurate by a page. What was the passage that proved so objectionable?

Macmillan's account in this book of general election night in 1955 seems anodyne compared with the version quoted by Simon Heffer in the earliest review, three months ago. A passage about the veteran Labour MP Gerald Kaufman has disappeared from the volume now on sale: "Our opponent at Bromley was a rather unpleasant youth called Kaufman - very Semitic. The little mayor, by way of being friendly after the poll said, 'Well, we're all Anglo-Saxon here, so let's shake hands in the Anglo-Saxon way!' This was very well received."

The glib, genteel racism of this anecdote, which seems distasteful now, was prevalent throughout the Fifties. It is striking that although Macmillan's publishers are so protective of his reputation, and of Jewish susceptibilities, they were not too squeamish to print his account of Winston Churchill, in a Cabinet discussion on West Indian immigration, declaring that: "'Keep England White' [is] a good slogan!"

Despite Macmillan's denials, his diaries were written with self-conscious craft to impress posterity. They tell an altogether more sympathetic, candid and convincing story than either his dreary, stilted memoirs or the authorised and unauthorised biographies. Whereas Macmillan's memoirs describe Alan Lennox-Boyd, the Colonial Secretary, as an "able, imaginative and generous colleague", his diaries call Lennox-Boyd "a great overgrown schoolboy, without judgement or profundity."

Cabinet histrionics are gloriously evoked. "His present mood is so self-centred as to amount almost to mania," Macmillan wrote of Churchill in 1954. "All of us, who really have loved as well as admired him, are being slowly driven into something like hatred." Macmillan's relationship with Churchill's successor as PM, Anthony Eden, was one of tortured interdependence. "Eden is a queer man," Macmillan wrote after other Cabinet ructions. "He has great charm and some great gifts ... but he is almost childishly jealous - hence ... he specially dislikes me, altho' I really like and admire him."

During the Suez debacle of 1956 Macmillan was initially the leading Cabinet belligerent, but behaved with turpitude at the moment of crisis, and ensured the ruin of Eden's reputation and health. He claims in these diaries to have "mislaid" the volume covering Suez, and pretended to his biographer to have destroyed it at Eden's behest. The truth surely is that he had shameful matters to suppress both about Suez and his wily, ruthless usurpation of Eden's power.

Macmillan liked to read about Machiavelli. His diaries, like Machiavelli's The Prince, are among those first-class political books, full of canny observations and sly asides, that constantly throw up parallels with the power politics of more recent times. "The Party system has killed Parliament and debate," Macmillan reflected in 1955. "The machines on both sides are in control".

"I do like detailed history," Macmillan enthused in these diaries, which are indeed full of marvellously enriching details. There are fascinating glimpses of Cabinet meetings, such as the excitement when samples of American "Horror comics" ("nauseating and sadistic", Macmillan thought) were handed round by the Home Secretary, who wanted to ban them. Ministers grabbed them eagerly. "I say, Fred, you might give a chap a chance," one impatient minister grumbled to Lord Woolton, who was hogging a copy.

International power politics provide one of the governing themes. Macmillan's mother came from the Mid-West, he was vocally pro-American, and he became an architect of the Special Relationship. Although the Bush presidency has overturned much he admired in America, notably that "multi-millionaires have no chance in politics unless they are on the left", his account of Anglo-American relations in the context of Iraq remains instructive.

When Iraq became diplomatically assertive in 1951, Macmillan railed against the "immense harm" caused by American policy. A year later he complained that the US treated Britain "worse than they do any country in Europe. They undermine our political and commercial influence all over the world. Yet all this they do ... with only one half of their mind and purpose ... while capable of terribly narrow views and incredible breaches of decency and decorum, they are also capable of ... really big-hearted generosity."

The Secretary of State, John Dulles, seemed to Macmillan "the most dunder-headed man alive". Under his direction, the US was an "impatient, mercurial, panicky" ally, which typically "ran" away from its earlier backing of the Baghdad Pact of 1955 in order, as Dulles explains, "to keep the American Jews quiet". Macmillan equally deplored the massive US financial support of the Saudis: "The Americans ... fail to recognise how absolutely irresponsible is their form of capitalism."

Virtually all the entries describe the exterior world of public service. Macmillan's ferocious workload in successive departments - Housing, Defence, the Foreign Office, the Treasury - would have broken most people: one can only marvel at his fortitude and self-control. His implacable careerism is altogether reminiscent of Tony Blair's indefatigable resolve. And like Blair in the Nineties, Macmillan in the Fifties was superbly modern in mastering the idiom and gestures of contemporary British politics - this despite venerating the past, and having subtle, scholarly historical insights that make Blair's obsession with his place in history seem abominably shallow.

Richard Davenport-Hines's 'The Pursuit of Oblivion' is published by Phoenix