Morning Call: pick of the comment

The ten must-read pieces from this morning's papers.

1. The Tories will get burnt fighting fire with fire (Times)

Daniel Finkelstein says that negative campaigning could damage David Cameron's image with the voters. The media focus on the Tories is an opportunity, not a threat.

2. Can anyone explain what the Conservative Party stands for? (Daily Telegraph)

Simon Heffer is not impressed with the way Cameron has moved power of decision-making in the party to the centre. In the absence of the old, core right-wing policies, the Tories lack clarity and direction, and are haemorrhaging support to fringe parties.

3. Bashing the rich won't work for Obama. But other rallying cries might (Guardian)

Obama is shrewd not to inveigh against the bankers, says Michael Tomasky. It would be better to make his cause by reminding America of the good things that the government does, and who higher taxes will help.

4. Passport to the truth in Dubai remains secret (Independent)

Whoever killed the Hamas official in Dubai is still playing an old, dirty war, says Robert Fisk. Now we must look beneath the propaganda for the truth.

5. How to walk the fiscal tightrope that lies before us (Financial Times)

Martin Wolf warns that huge fiscal tightening could tip much of the world back into recession. We must make it one of our priorities to let the private sector heal.

6. Power to the people -- and trust them too (Times)

James Purnell and Jim Murphy renew calls for a radical Labour manifesto. The party has lost faith in its communal roots, they say, but the public can be trusted to make the right decisions.

7. Why is our anti-war outrage muted at this Afghan folly? (Guardian)

Even doubters seem to be giving the military intervention one last chance, says John Kampfner, but there is little confidence it will succeed.

8. The year China showed its claws (Financial Times)

David Shambaugh looks at what lies behind Beijing's new assertiveness. Is it a case of true colours showing, a display of nationalism in the run-up to a change of leadership, or a sign of confidence gained from the vindication of the Chinese development model?

9. The Bank of England is right to hold its nerve (Independent)

Inflation is proving sticky, but it is premature to tighten monetary policy, says the main leader.

10. Hostage to hot air (Guardian)

Isabel Hilton says that the climate debate in the United States is mired in political weakness and infighting, setting the tone for unconstructive global negotiations.

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Theresa May gambles that the EU will blink first

In her Brexit speech, the Prime Minister raised the stakes by declaring that "no deal for Britain is better than a bad deal for Britain". 

It was at Lancaster House in 1988 that Margaret Thatcher delivered a speech heralding British membership of the single market. Twenty eight years later, at the same venue, Theresa May confirmed the UK’s retreat.

As had been clear ever since her Brexit speech in October, May recognises that her primary objective of controlling immigration is incompatible with continued membership. Inside the single market, she noted, the UK would still have to accept free movement and the rulings of the European Court of Justice (ECJ). “It would to all intents and purposes mean not leaving the EU at all,” May surmised.

The Prime Minister also confirmed, as anticipated, that the UK would no longer remain a full member of the Customs Union. “We want to get out into the wider world, to trade and do business all around the globe,” May declared.

But she also recognises that a substantial proportion of this will continue to be with Europe (the destination for half of current UK exports). Her ambition, she declared, was “a new, comprehensive, bold and ambitious Free Trade Agreement”. May added that she wanted either “a completely new customs agreement” or associate membership of the Customs Union.

Though the Prime Minister has long ruled out free movement and the acceptance of ECJ jurisdiction, she has not pledged to end budget contributions. But in her speech she diminished this potential concession, warning that the days when the UK provided “vast” amounts were over.

Having signalled what she wanted to take from the EU, what did May have to give? She struck a notably more conciliatory tone, emphasising that it was “overwhelmingly and compellingly in Britain’s national interest that the EU should succeed”. The day after Donald Trump gleefully predicted the institution’s demise, her words were in marked contrast to those of the president-elect.

In an age of Isis and Russian revanchism, May also emphasised the UK’s “unique intelligence capabilities” which would help to keep “people in Europe safe from terrorism”. She added: “At a time when there is growing concern about European security, Britain’s servicemen and women, based in European countries including Estonia, Poland and Romania, will continue to do their duty. We are leaving the European Union, but we are not leaving Europe.”

The EU’s defining political objective is to ensure that others do not follow the UK out of the club. The rise of nationalists such as Marine Le Pen, Alternative für Deutschland and the Dutch Partij voor de Vrijheid (Party for Freedom) has made Europe less, rather than more, amenable to British demands. In this hazardous climate, the UK cannot be seen to enjoy a cost-free Brexit.

May’s wager is that the price will not be excessive. She warned that a “punitive deal that punishes Britain” would be “an act of calamitous self-harm”. But as Greece can testify, economic self-interest does not always trump politics.

Unlike David Cameron, however, who merely stated that he “ruled nothing out” during his EU renegotiation, May signalled that she was prepared to walk away. “No deal for Britain is better than a bad deal for Britain,” she declared. Such an outcome would prove economically calamitous for the UK, forcing it to accept punitively high tariffs. But in this face-off, May’s gamble is that Brussels will blink first.

George Eaton is political editor of the New Statesman.