The Eurosceptic prophecy fulfils itself

Cameron has traded influence in the European Union for a brief respite from rebellion in his party,

David Cameron really didn't have much of a choice in the end. As it became clear that he simply wasn't going to get the concessions he needed – "safeguarding" Britain's interests in the single market; blocking aspects of European financial services reform – he couldn't sign up to a new EU deal. Trying to force such a treaty through parliament would be immensely painful and damaging to the Prime Minister. Besides, Ireland and the Netherlands have constitutional obligations to hold referendums on new EU treaties. It would be very difficult for Cameron to refuse to consult his citizens if the Dutch and Irish were being asked.

So he said "no". What does this mean? The eurozone members and six others – a eurozone-plus – aim to proceed with their own pact to stabilise the single currency and pursue fiscal integration. Technically, it is very difficult for them to use EU institutions to enforce their deal (which is why Germany, in particular, would have preferred a full 27-member EU treaty, and why markets will question whether the euro has in fact been saved).

There will now be a lot of wrangling over what competences this new inner European core has to enact economic reforms that affect the outer tier. Britain's problem is that the outer tier is tiny: the UK and Hungary, possibly Sweden and the Czech Republic. Legally they have a strong case to prevent the eurozone-plus group from building a new institutional architecture from existing EU bodies – the Commission, the Court, the Parliament etc.

But in practice the inner core is big enough to form a majority in the Council – the assembly of heads of government where real EU decisions are made – to the near-permanent exclusion of Britain. This is the "caucusing" effect that the Foreign Office has been worried about – a situation in which the eurozone gang arrives at summits with a pre-agreed position and presents it to the outer tier as a fait accompli. When the reality of that new balance of power becomes clear, Hungary and the other naysayers might well decide their long-term interests are better served by eventually joining the inner circle, leaving the UK completely isolated.*

In other words, Cameron has blocked a treaty that he judges might have damaged UK interests, thereby creating a new settlement in the EU that could permanently tilt future negotiations against Britain. That in turn means hardline Tory sceptics will have good grounds to say that our relationship with the EU has been fundamentally altered and, inevitably, that there should be a referendum.

As I wrote yesterday, the Tories bank concessions on Europe and then come back for more. Last night Cameron made a very big concession indeed – he removed Britain from the next phase of the European project.

Sceptics should be pleased and, as my colleague Samira Shackle has noted this morning, some of them are. Then they will find, as they always do, that pushing for separation leads to diplomatic isolation, which reinforces their suspicion that the whole thing is a conspiracy against Britain. The prophecy fulfils itself. So they will insist that Cameron now set about the business of "repatriating" powers from Brussels, which, of course, he is much less able to do, having isolated the UK and antagonised fellow EU leaders. And when Cameron cannot then secure adequate "repatriation" – and nothing short of divorce is adequate for some Tory backbenchers – the calls for a referendum will sound out louder than ever.

The Prime Minister's non-deal in Brussels last night has bought him just a brief a moment of respite from rebellion in his own party. For that, he has accepted a downgrading of UK diplomatic relations with our major trading partners, leading us to the outermost margin of the EU and ever closer to the exit.

*Update: Indeed, Hungary sensed which way the wind was blowing pretty quickly and has now lined up with the non-UK consensus. It is still possible, of course, that Cameron is gambling that this emergency alliance of the rest of Europe will not last. National parliaments will have to be brought on side, some countries will expect referendums on a new euro pact and, crucially, since last night's deal doesn't appear to have actually resolved the structural flaws in the design of the single currency it might well fail to ease the market pressure driving the euro members apart. If it becomes clear that smaller states have signed up for something that gives Germany and France all of the power with no economic security in return there is bound to be a significant nationalist backlash in many countries. The whole thing could unravel, in which case the hardline British eurosceptics' ambition of getting out altogether would be realised even sooner.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

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The campaign to keep Britain in Europe must be based on hope, not fear

Together we can show the world a generous, outward-facing Britain we can all be proud of.

Today the Liberal Democrats launched our national campaign to keep Britain in Europe. With the polls showing the outcome of this referendum is on a knife-edge, our party is determined to play a decisive role in this once in a generation fight. This will not be an easy campaign. But it is one we will relish as the UK's most outward-looking and internationalist party. Together in Europe the UK has delivered peace, created the world’s largest free trade area and given the British people the opportunity to live, work and travel freely across the continent. Now is the time to build on these achievements, not throw them all away.

Already we are hearing fear-mongering from both sides in this heated debate. On the one hand, Ukip and the feuding Leave campaigns have shamelessly seized on the events in Cologne at New Year to claim that British women will be at risk if the UK stays in Europe. On the other, David Cameron claims that the refugees he derides as a "bunch of migrants" in Calais will all descend on the other side of the Channel the minute Britain leaves the EU. The British public deserve better than this. Rather than constant mud-slinging and politicising of the world's biggest humanitarian crisis since the Second World War, we need a frank and honest debate about what is really at stake. Most importantly this should be a positive campaign, one that is fought on hope and not on fear. As we have a seen in Scotland, a referendum won through scare tactics alone risks winning the battle but losing the war.

The voice of business and civil society, from scientists and the police to environmental charities, have a crucial role to play in explaining how being in the EU benefits the British economy and enhances people's everyday lives. All those who believe in Britain's EU membership must not be afraid to speak out and make the positive case why being in Europe makes us more prosperous, stable and secure. Because at its heart this debate is not just about facts and figures, it is about what kind of country we want to be.

The Leave campaigns cannot agree what they believe in. Some want the UK to be an offshore, deregulated tax haven, others advocate a protectionist, mean-hearted country that shuts it doors to the world. As with so many populist movements, from Putin to Trump, they are defined not by what they are for but what they are against. Their failure to come up with a credible vision for our country's future is not patriotic, it is irresponsible.

This leaves the field open to put forward a united vision of Britain's place in Europe and the world. Liberal Democrats are clear what we believe in: an open, inclusive and tolerant nation that stands tall in the world and doesn't hide from it. We are not uncritical of the EU's institutions. Indeed as Liberals, we fiercely believe that power must be devolved to the lowest possible level, empowering communities and individuals wherever possible to make decisions for themselves. But we recognise that staying in Europe is the best way to find the solutions to the problems that don't stop at borders, rather than leaving them to our children and grandchildren. We believe Britain must put itself at the heart of our continent's future and shape a more effective and more accountable Europe, focused on responding to major global challenges we face.

Together in Europe we can build a strong and prosperous future, from pioneering research into life-saving new medicines to tackling climate change and fighting international crime. Together we can provide hope for the desperate and spread the peace we now take for granted to the rest of the world. And together we can show the world a generous, outward-facing Britain we can all be proud of. So if you agree then join the Liberal Democrat campaign today, to remain in together, and to stand up for the type of Britain you think we should be.