Cameron finally has a coherent Europe policy - but does his party want to listen?

The PM is inching towards a sceptical but engaged role in Europe. But his MPs won't be bought off.

After the umpteen crisis summits that have dominated Brussels-night life, last week's meeting of EU leaders was one of the dullest in recent memory. With the clock well past 3am, bleary-eyed leaders stumbled along to brief the no-less bleary-eyed Brussels press corps that, after ten hours of painstaking negotiating, a couple of words in the summit conclusions had been changed.

Three months after agreeing to create a single supervisor for the eurozone by the end of 2012, EU leaders confirmed that they had actually meant it and that the legal framework would be in place by the end of 2012.

But while leaders lined up to put their own national spin on the banking union agreement, David Cameron's Friday morning press briefing was significant, not just because of what he said, but also the way he said it.  In the course of a 20 minute briefing Cameron referred to "a new settlement" for both the eurozone and Britain about five times. Every time he spoke of the necessity of a banking union and deeper integration for the eurozone in the next breath he added that Britain would not be involved in any of it.

As a statement of fact, it is hard to disagree with him. Deeper integration of the eurozone will change Britain's relationship with the EU. Whether it is bank supervision by the ECB, a specific budget for the eurozone or a single Treasury for the single currency, all have as profound implications for the 10 countries outside the eurozone as for the eurozone-17. All, particularly Denmark and Sweden, the two other countries where euro-membership is squarely off the political agenda, will have big decisions to make, but a multi-speed Europe will surely become even clearer than it already is.

The first question is whether Cameron genuinely wants Britain to have second division membership and, if so, whether other countries will let him. Although Michael Gove and Iain Duncan-Smith lead the 'get-outer' faction in his cabinet, it seems clear that Cameron does not want Britain to leave the EU. In fact, he was at pains to repeat his commitment to Britain's EU membership, particularly to the single market, and to the country's 'euro-realism' on foreign policy.

The Cameron-doctrine on Europe seems to boil down to the following: pro-single market and in favour of ad hoc co-operation on foreign policy and blanket opposition to everything else - from the euro and JHA policy to social policy. However, while there is plenty to criticise from a left or liberal perspective, it is an ideologically coherent and thoroughly Tory approach.

At the same time, however, his government continues to add fuel to the perception that Cameron's EU policy is one of outright hostility. Indeed, after a week in which his government decided to opt out of over 130 legal acts on justice and home affairs policy and senior ministers mooted the possibility of a referendum on the EU within a year of the next election expected in 2015, the remark by Finland's Europe minister, Alex Stubb, that Britain was waving "bye, bye to Europe" is understandable. One of the Tories' main weaknesses on Europe is their lack of any significant allies and it is hard to see how Cameron can secure the opt-outs his party craves if he constantly provokes hostility from other European governments

That is why Cameron should tread carefully at November's specially convened EU budget summit. Angela Merkel has already thrown down the gauntlet, threatening to call off the summit - a veto to pre-empt a veto - if Cameron and William Hague continue to demand big reductions in EU spending. The entire EU budget only represents 1 per cent of GDP and the funds being argued about between countries are pretty small - around 0.1 per cent of GDP. But if it is already hard to see other countries agreeing to more British opt-outs, holding the rest of Europe to ransom over a tiny proportion of the EU budget would be completely counterproductive.

The other question is whether his party is prepared to listen. One of the mistakes Cameron made early on was to think that he could buy off his eurosceptics. Despite pulling his MEP delegation out of the centre-right European People's Party group and putting a "referendum lock" into UK law, many Tory activists are still convinced that their leader is a kool-aid slurping federalist and will accept nothing short of as many 'in/out' referendums as it takes to get the right result.

However, it is not as if either Labour or the Liberal Democrats have a coherent Europe policy around which to take advantage of Cameron's contortions. Since being ousted from power in 2010, Labour has taken a conscious decision not to be a hostage to fortune by laying down detailed policy platforms and Europe is no exception. Senior figures in the party are even considering whether to steal a march on the Tories by promising a referendum on Britain's EU membership in their next manifesto, a high risk strategy for no obvious political gain considering that the party won't convince anyone if it tries to 'out-sceptic' the Conservatives.

As for the Lib Dems, the only way that their pro-EU stance will be a vote-winner is if they use it in 2014 to despatch Nick Clegg to Brussels as Britain's next Commissioner, conveniently a year before facing the wrath of the electorate the following year.

Europe has been one of the most destructive forces in the Conservative party for over twenty years. After wrangling over the ERM and attitudes to European integration contributed to Thatcher's downfall, John Major's government was wrecked by civil war over the Maastricht Treaty and, since then, the Tories have repeatedly failed to articulate a policy position capable of getting grass-roots support and being put into practice. But now eurozone integration seems set to formally create a club within a club. Cameron acknowledges this and is inching towards a sceptical but engaged role in Europe. The question is whether other European leaders, and his party activists, are ready to listen.

Ben Fox is chairman of GMB Brussels and political adviser to the Socialist vice-president of economic and monetary affairs.

David Cameron gives a press conference on the final day of an EU summit in Brussels on 19 October 2012. Photograph: Getty Images.
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By refusing to stand down, Jeremy Corbyn has betrayed the British working classes

The most successful Labour politicians of the last decades brought to politics not only a burning desire to improve the lot of the working classes but also an understanding of how free market economies work.

Jeremy Corbyn has defended his refusal to resign the leadership of the Labour Party on the grounds that to do so would be betraying all his supporters in the country at large. But by staying on as leader of the party and hence dooming it to heavy defeat in the next general election he would be betraying the interests of the working classes this country. More years of Tory rule means more years of austerity, further cuts in public services, and perpetuation of the gross inequality of incomes. The former Chief Secretary to the Treasury, Seema Malhotra, made the same point when she told Newsnight that “We have an unelectable leader, and if we lose elections then the price of our failure is paid by the working people of this country and their families who do not have a government to stand up for them.”

Of course, in different ways, many leading figures in the Labour movement, particularly in the trade unions, have betrayed the interests of the working classes for several decades. For example, in contrast with their union counterparts in the Scandinavian countries who pressurised governments to help move workers out of declining industries into expanding sectors of the economy, many British trade union leaders adopted the opposite policy. More generally, the trade unions have played a big part in the election of Labour party leaders, like Corbyn, who were unlikely to win a parliamentary election, thereby perpetuating the rule of Tory governments dedicated to promoting the interests of the richer sections of society.

And worse still, even in opposition Corbyn failed to protect the interests of the working classes. He did this by his abysmal failure to understand the significance of Tory economic policies. For example, when the Chancellor of the Exchequer had finished presenting the last budget, in which taxes were reduced for the rich at the expense of public services that benefit everybody, especially the poor, the best John McConnell could do – presumably in agreement with Corbyn – was to stand up and mock the Chancellor for having failed to fulfill his party’s old promise to balance the budget by this year! Obviously neither he nor Corbyn understood that had the government done so the effects on working class standards of living would have been even worse. Neither of them seems to have learnt that the object of fiscal policy is to balance the economy, not the budget.

Instead, they have gone along with Tory myth about the importance of not leaving future generations with the burden of debt. They have never asked “To whom would future generations owe this debt?” To their dead ancestors? To Martians? When Cameron and his accomplices banged on about how important it was to cut public expenditures because the average household in Britain owed about £3,000, they never pointed out that this meant that the average household in Britain was a creditor to the tune of about the same amount (after allowing for net overseas lending). Instead they went along with all this balanced budget nonsense. They did not understand that balancing the budget was just the excuse needed to justify the prime objective of the Tory Party, namely to reduce public expenditures in order to be able to reduce taxes on the rich. For Corbyn and his allies to go along with an overriding objective of balancing the budget is breathtaking economic illiteracy. And the working classes have paid the price.

One left-wing member of the panel on Question Time last week complained that the interests of the working classes were ignored by “the elite”. But it is members of the elite who have been most successful in promoting the interests of the working classes. The most successful pro-working class governments since the war have all been led mainly by politicians who would be castigated for being part of the elite, such as Clement Atlee, Harold Wilson, Tony Crosland, Barbara Castle, Richard Crossman, Roy Jenkins, Denis Healey, Tony Blair, and many others too numerous to list. They brought to politics not only a burning desire to improve the lot of the working classes (from which some of them, like me, had emerged) and reduce inequality in society but also an understanding of how free market economies work and how to deal with its deficiencies. This happens to be more effective than ignorant rhetoric that can only stroke the egos and satisfy the vanity of demagogues

People of stature like those I have singled out above seem to be much more rare in politics these days. But there is surely no need to go to other extreme and persist with leaders like Jeremy Corbyn, a certain election loser, however pure his motives and principled his ambitions.

Wilfred Beckerman is an Emeritus Fellow of Balliol College, Oxford, and was, for several years in the 1970s, the economics correspondent for the New Statesman