It is obvious that the crisis engulfing the eurozone has serious ramifications for Britain. It has also placed David Cameron in a tight spot politically, as he struggles to balance the demands of vociferous Eurosceptic MPs and a Franco-German alliance willing to forge ahead without Britain if it needs to.
As he prepares to join the EU's other 26 heads of government to discuss plans to save the euro, Cameron has attempted to navigate these contesting demands and set out his position in an article in the Times (£).
There are two key points to take from this piece. Firstly, Cameron dismisses calls for a referendum on any treaty changes by reiterating that this law only applies in the case of powers being transferred from Britain to the EU. At the weekend, Iain Duncan Smith added to Cameron's headache when he suggested that it could, in fact, apply to any "major treaty change", such as that required for greater fiscal union. Cameron also states that his demands will remain "practical and focused", despite calls from his MPs to use the talks to renegotiate social and employment law.
But he does not disregard his party's Eurosceptic wing entirely. The second key point is a hardening of rhetoric and a pledge to protect Britain's interests. Cameron warns that his focused approach should not be mistaken "for any lack of steel", and says that safeguards for the City of London will be the price of his support for any changes:
Our colleagues in the EU need to know that we will not agree to a treaty change that fails to protect our interests.
Essentially, Cameron is caught between a rock and a hard place. If he wants to create a treaty for all 27 EU member states, he must strike a conciliatory tone in talks with the rest of the EU. If, however, he prioritises an aggressive defence of Britain's interests, the likelihood is that the 17 eurozone countries will breakaway and form a treaty amongst themselves. In his piece, he addresses this possibility, saying that a treaty of 17 "would need to make sure our interests are protected".But it is unrealistic to think that Britain will not lose influence in such a scenario. Quite simply, he can't have it both ways, as my colleague Rafael Behr argued last week:
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.
Cameron writes that "our biggest national interest is that the eurozone sorts out its problems", but from his posturing, it appears that he is not fully committed to this and remains trapped in a lose-lose situation. On the same day as the Prime Minister ramps up the rhetoric, veteran pro-Europe Tory Ken Clarke has told the FT that Britain should be a constructive player in resolving this crisis, focussing on "how to maintain the financial stability of the western world", not trying to wring concessions from eurozone countries. Quite simply, France and Germany have bigger fish to fry as they try to save the single currency, and they will have no problem with acting without Britain.