The Liberal Democrats are in crisis.

As it develops, the party's leader looks weaker and weaker. In retrospect it's clear that his two televised debates with Ukip leader Nigel Farage amounted to a wholesale disaster.

The Deputy Prime Minister was not just beaten twice; he was trounced twice. Personally, I prefer Mr Clegg's rather earnest, slightly pained manner to Mr Farage's lounge bar bravado, but there is no doubt that the latter is an exceptionally sharp debater and should never be underestimated by anyone.

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Mr Clegg did very well in the televised debates that preceded the 2010 UK general election. He outshone both David Cameron and Gordon Brown. Maybe that engendered some hubris.

Meanwhile, it is almost entirely due to Mr Farage that Ukip have become so prominent in English (but not, thank goodness, Scottish) politics. Now that many lower rank Ukip candidates are getting some media attention, it does indeed appear that some of them are "fruitcakes", to use Prime Minister Cameron's description. Some of them may be racist fruitcakes at that.

But Mr Farage sails on regardless. It is worrying that closet racism appears to be festering all across England, in the shires just as much as in the post-industrial wastelands. I'd never suggest that Mr Farage himself was in any way tinged with racist attitudes, but unless he takes more care his party may end up unleashing something that is pretty ugly.

As for Mr Clegg, he had the chance to cause considerable damage to the electoral credibility of Ukip. Two stellar televised performances from him and he could have pretty well destroyed the Mr Farage and his party. Instead, he blew it.

Much more alarming than this are the developing ramifications of the appalling activities of the late Sir Cyril Smith, who was in his time a senior and much-lauded Liberal and then LibDem figure.

This growing scandal has potentially cataclysmic constitutional implications. If it becomes clear that senior LibDems knew, over a long period, of Smith's predatory activities, then the party's credibility will be grievously damaged. It might even become difficult for any decent person to vote for it.

To prevent any such situation developing, Mr Clegg must take command. He must announce a full and urgent party inquiry, to run in parallel with the police inquiry into the local council's involvement in the scandal.

Thanks to the assiduous work of the current MP for Rochdale, the Labour politician Simon Danczuk, it is now known that Smith was a bad man on the scale of Jimmy Savile.

He once sang a song on one of Savile's TV shows, though he never achieved the national popularity that Savile enjoyed. But politically, he was regarded as larger than life, a great character. In reality, this 30 stone ogre was a sexual predator of the most heinous kind.

Nick Clegg has suggested that Smith should be posthumously stripped of his knighthood. But who recommended him for this considerable honour, and who endorsed it? These are questions that must be answered.

Smith's activities seem to have been covered up with some assiduity, with a kind of grisly care. A huge man physically - he was a pygmy in every other sense - he still casts a ghastly shadow. So the British public require to know who exactly was involved in the cover- up.

There is a huge moral issue here, which is more important than anything else. But there is a big political issue, as well.

The UK faces a period of acute uncertainty, of potentially historic change. Within the next year or so Scotland could well be independent and England could well decide to quit the European Union. The LibDems, understandably and correctly, will wish to play a central role in these momentous decisions and the crucial debates that will precede them. If the party's credibility totally collapses, this will have enormous consequences that can hardly be exaggerated.

So Mr Clegg simply must show genuine leadership. He must get to grips with the Cyril Smith scandal, and soon.