The Tories now face a choice between, broadly speaking, three different responses:
i) Ignore Campbell. Even though James was right to highlight the differences between now and the Crewe & Nantwich byelection – which I wrongly skipped over in an earlier post – I still feel that this kind of relentless, negative campaigning on Labour's part could reflect badly upon them, particularly as they're the governing party. Not only does it undermine Brown's claim that he concentrates on "politics not personality", but it also drags up the Ghosts of Smear Operations Past. Besides, who said that the Tories' inheritance tax proposal is unpopular with the public? As Danny Finkelstein suggested in a recent post, the opposite is almost certainly true.
If the Tories want to expand out from this, then they could think about proposing changes to the tax system which would benefit the least well off: raising thresholds, cutting rates, that kind of thing. This could have the twin benefits of helping to alleviate poverty, while also smoothing out the high marginal rates which disincentivise extra work. The great problem with this, of course, is cost. But this is where the Tories might start thinking about some of their existing proposals – such as the IHT cut – and whether they'd rather "spend" the money in alternative ways. As per i), though, I think the Tories would be unwise to drop or dilute the IHT cut purely in response to Brown's crude hectoring.
iii) Launch a negative fightback. Of course, there's plenty of room for the Tories to attack Labour on the same grounds that Campbell is treading against them: Smeargate, the 10p tax fiasco, metrics which show rising inequality, and so on. This is risky, though, as it has the same negative implications mentioned in i) above. And the Tories would have to round out their own policy package before attacking, say, Brown's tax measures.
To my mind, ii) is the best approach for Team Cameron to take – but, then, it always has been.