The Staggers

The New Statesman’s rolling politics blog

A new chapter in EU integration, whether Britain likes it or not

The new EU treaty is bound to contain something that British sceptics think requires a referendum.

By Rafael Behr Published 05 December 2011 17:45

There will be a new treaty. It will commit euro members to fiscal discipline. It will be largely designed by the 17 current members of the European single currency. Others can join in if they want to. Those are the essential components of the deal announced today by German Chancellor Angela Merkel and French President Nicholas Sarkozy after crisis talks in Paris.

In a sense this is exactly what had been expected. Discussions had been pointing in this direction since the end of last week. But the fact that the two leaders managed to say it at the same time in a live press conference lends the project a certain solidity and irrevocability. Something along the lines of what has been pledged might actually happen. Markets certainly seem reassured. The two leaders have promised monthly summits stretching ahead into the future (the preferred deadline is March 2012) to hammer out the details until a treaty is agreed and a new institutional and legal basis for the euro is fixed. The crucial fact as far as Britain is concerned here is that those summits will be convened among euro member heads of government. That is reasonable enough given it is their currency in crisis.

But Merkel did not describe these new summits as euro-fixing technical negotiations. She made it clear they would have a wide-reaching economic agenda to look at ways to stimulate growth through market reforms. That assertion spells disaster for David Cameron. His main demand in this process was to be included in the conversation about the future of the single market, to make sure Britain's vital interest in that aspect of European Union economic management was not overlooked in the hurry to redesign the single currency. If there are to be monthly euro-members-only summits looking at the whole growth and reform agenda it seems certain single market rules are going to get caught up in the negotiations. There are all sorts of ramifications if Britain isn't at the table, starting with the likely acceleration of moves on banking and finance reform to shift the balance of commercial power from the City of London to Frankfurt and Paris.

At a briefing shortly after the Merkel-Sarkozy press conference, the Prime Minister's spokesman made it clear the UK government's position is to examine more closely the content of what Germany and France are suggesting before forming a view on whether it would be better dealt with as a 17-member (euro only) treaty or a 27 member (full EU treaty). That position won't hold for long. It doesn't look as if Britain has much of a say anyway, and either outcome gives Cameron a headache. If he can persuade the European Council later this week that all 27 EU members should be working on a new treaty, he invites his backbenchers to present him with a shopping list of powers to repatriate during the talks. If he accepts that it should just be a 17-strong euro member treaty negotiation, he risks surrendering Britain's seat in a discussion that is plainly vital to our national economic interest. That process might still produce a document that has to be ratified by parliament. One way or another, the clamour for a referendum will grow.

Merkel and Sarkozy appear to have agreed a fast-track eurozone consolidation on a take it or leave it basis as far as the rest of the EU is concerned. From the French and German perspective it now looks as if the future of the European Union and the future of the single currency are the same thing. They are embarking on a new phase of integration. The implicit message to Britain: come along if you must, but stay in the back seat because we're driving.

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Tags: Europe Tories & Europe

More from Rafael Behr

23 comments

Mon, 2011-12-05 22:08 — Tesco Shelf Stacker (not verified)

Let's put it to a referendum and let the British people decide - bring it on .... all or nothing!

http://www.youtube.com/watch?v=gcU3f7XbuBo

Mon, 2011-12-05 22:30 — Lox (not verified)

Willyowen, when you say that you believe in a future in which the EU is more united-does that mean you think it'll happen, or you want it to happen, or both?
If the second or the third option, why? Can you explain what concrete benefits the EU brings that the EEC didn't? Or are you just enthused by the sheer scale of the entire corrupt mess?

Tue, 2011-12-06 07:52 — Stuart Eels (not verified)

Sat here reading these comments, some of them quite insane and BBC News on R5 reports that Standard and Poor is considering down-rating the entire Eurozone. Wonder what the people of Germany will make of that?

Hope our German and French friends have a plan B, C and D because A seems to be going down the drain already!

Thu, 2011-12-08 11:29 — dave hawkins (not verified)

willoyen 05 December 2011 at 19:09 -
The flip side of schadenfreude is self loathing. The nitemare scenario u exhalt in amounts to the routing of Anglo/US by Franco/German Finance Capital (F/C) and the UK reduced to 3 balkanised british statelets ruled by the EU. The power of venal UK F/C does have to be broken - but by the British People and their Labour Movement thru an assertion of popular soveriegnty & democracy.

Tue, 2011-12-06 10:33 — Indu Pendent (not verified)

UK and the coalition are on track to be the only credible major economy with AAA.

Do Labour still think it would be worth the UK losing the AAA so that they could go on a borrowing and voter treat spending binge?

Tue, 2011-12-06 14:39 — Stuart Eels (not verified)

I don't set out to question or quarrel with you swatantra nandanwar but you do talk some nosense at times. A few weeks ago Mrs Merkal was saying that if the euro wasn't saved there would be war in Europe. I rather think that the Southern Countries in the Euro will soon realise that they cannot stick to spending levels imposed on them by Berlin/Paris and that very fact could result in conflict.

It really is time that these fools woke up to the fact the Euro is finished. It was flawed from the start and their actions now are bleeding every country in Europe dry.

For you to come out with such rubbish on this day says it all about why you were never elected!

Thu, 2011-12-08 17:24 — C Baker

Merkel and Sarky must have a routine going. She points finger, he points finger. Then they kiss, then shake hands and it goes on and on whilst they say so much must be done.....

Is this what european democracy has come too? It's too depressing for words. Two hapless people dictating to Ireland, England, Scotland and Wales and the rest of the euro countries.

Where are the socialists? Where is democracy? The EU is corrupt.

Tue, 2011-12-06 16:50 — rob andersen (not verified)

@ Willoyen
and Hamlet was written by someone with a sense of humour.
MORE evidence that lefties simply can't get jokes... 2 in a week. U must hate christmas ...

Tue, 2011-12-06 18:45 — Ian5

Makes me some what sad to see that European Continent has shrunk to just France and Germany...These blaggers pushed for the euro ,ignored sound advice about qualification etc. Now they want everybody to help in the bail out. Seems we are over a barrel.

Mon, 2011-12-05 18:31 — C Baker

In my crystal ball I can see that none of this will work. Come March 2012, Greece will have no money left.
What is fiscal discipline? If you don't adhere to this- we will what? Also, the markets will do what they like and who is going to bail the banks out again? What about french banks?

This meeting is about as powerful as a kiddies tea party.

Whether Cameron wears lederhosen and we join the euro, or we leave completely and grow our own veg, the merkozy plan won't work in reality. This is because they can't control about 80% of what is needed to make it work.

I wish them all the success- but really it's all hot air.

Tue, 2011-12-06 10:17 — swatantra nandanwar

What Europe needs is the smack of firm Prussian discipline to keep it in order. Think of Europe as an organism; it has many parts but without a central nervous system there is no coordination. Thats why we need an elected Council of Europe, QMV, single Foreign and Defence Ministers who are effective, and an elected President of Europe.
Only when these bodies are in place can Europe face the challenge of the Americas, Russia and the Asian Tigers. Without these bodies we might as well give up now.
BTW Poland is hosting the next European Cup and therefore has to be on its best behaviour; and that means stamoing out racism from players and particularly Eastern Bloc and Spanish fans.

Mon, 2011-12-05 18:40 — Hugh Markey (not verified)

Cameron is now playing stud poker with the big boys! If he gets away with this bluff he deserves to win the pot. Sadly, if he does not - a lemon.
[Remember Edward G Robinson's put-down of Steve Mcqueen's 'the Cincinnati Kid'. "You're good kid. Just not good enough!"

Sky Masterson

Mon, 2011-12-05 19:39 — Anthony (not verified)

WOW, Rafael comes across as a real fanatic, truly scary stuff. VOTE UKIP for freedom and democracy.

Mon, 2011-12-05 20:03 — swatantra nandanwar

This is best news to come out of the Merkozy Plan since the Franco-Prussian Axis in the C19. We need a stable Europe and a Europe that is governed by fiscal discipline discipline discipline. That in future has to be the watchword. So I guess that leaves Britain out in the cold once again.
We are moving closer to a United States of Europe which can only be a good thing. Because you can't have a war with yourself, unless its a Civil War. Stability at last, and with stability comes progress and prosperity. And once again Britain will not be a full member of the club.

Mon, 2011-12-05 20:09 — willoyen

Rafael's article has a touch of the told-you-so schadenfreude for the British position, and quite right too. At last the EU can look forward to progress on integration, which was always one aim of the original treaty of Rome without the British spoilers. It's great for the UK too, because they won't need a tiresome referendum (not part of British culture anyway), as they are being marginalized, and gradually pushed out! Wonderful news for everybody! The Scots will have their independence ref. and probably afterwards vote to continue in the EU and join the eurozone. The future is assured. The City will decline, not terminally, but chronically. it's mostly foreign owned anyway.
And we will see the rise again of the Carolingian empire just offshore - oh, sorry, ONshore. ha ha ha.

Mon, 2011-12-05 20:23 — Buckskins (not verified)

"[Remember Edward G Robinson's put-down of Steve Mcqueen's 'the Cincinnati Kid'. "You're good kid. Just not good enough!"

You're good kid, but as long as I'm around you will be second best.

Mon, 2011-12-05 20:49 — willoyen

Fox Hunter The Poles are enthusiastic members of the EU, (like the others who joined in 2004), though not yet of the eurozone, until it has 'worked out its difficulties'. They intend to join eventually. You may recall the Poles distanced themselves from Cameron when he tried to suck up to them in the autumn. The Swedes are committed to joining the eurozone eventually, and to a referendum. The Danes are the only EU members with an opt-out like Britain.They had referendum a few years ago. Support rises and falls. But the UK is the country with the greatest deficit in understanding and knowing about the EU and how it works.

Mon, 2011-12-05 21:12 — Hugh Markey (not verified)

@ Buckskins
Apologies to scriptwriter. Dave is second-best no matter who's around. Couldn't compete - so prep and public school route to top. Shame!

A Touch of the Verbals

Mon, 2011-12-05 21:18 — T Max (not verified)

Willoyen, you are quite mad.

Mon, 2011-12-05 21:44 — jaded1

The Euro is a great success and we must rush and join it......sorry finding it hard to type whilst in this straight-jacket bouncing off these rubber walls!

Mon, 2011-12-05 21:47 — willoyen

T Max 'quite mad', am I? Well, according to the gravedigger, they sent Hamlet to England that his madness might not be noticed ...
I believe in a future in which the EU is united, more or less..and the 'more or less' is the challenge, of course, but a challenge the Brits don't want. I think they have lost their chance to influence the course of events, and have no one to blame except themselves and their tabloid masters. Is that mad? If so, so be it.