Cameron: neither in nor out of Europe

Hamish McRae has the graph of the day, showing that interest rates in the eurozone have diverged so that they are now back where they were before the euro was introduced in 1999 (that was when the currencies were locked together; the graph shows that interest rates converged two years earlier in 1997; notes and coins were introduced in 2002).

McRae’s column in today’s Independent on Sunday is brilliant analysis of why last week’s Brussels summit, the 19th since the Greek crisis, will not postpone the end of the euro for ever.

In my column in The Independent on Sunday, I try to assess the implications of this for British politics. I take as my text David Cameron’s words in Brussels on Friday. These included: “This is going to be something that is going to evolve over a whole series of years.” But the important passage was:

The problem with an in-out referendum is it actually only gives people those two choices: you can either stay in with all the status quo, or you can get out. Most people in Britain, I think, want a government that stands up and fights for them in Europe, and gets the things we want in Europe, that changes some of the relationship we have in Europe.

The Prime Minister’s attempt to clarify what he meant in an article in The Sunday Telegraph today and in the words of “a source close to the Prime Minister” in the Mail on Sunday do not take us much further, although both those newspapers did the needful by reporting that Cameron had “opened the door” to a referendum, rather than the “Cameron rules out referendum” headlines that greeted his Brussels statement.

Cameron’s basic position is “neither in nor out”, which might be described as the true spirit of Britain’s engagement with the European project since 1957. But as I conclude, it does not look like leadership.

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• Toocleverbyhalf

  It seems you pro-”free”- currency-market / anti-euro dreamers are starting to clutch at straws.

  Down with the dollar, it’s ruining small-town America’s independence.

  Is it really your opinion that what the world needs now is an increased number of opportunities for bankers to manipulate exchange rates to their own advantage?

  PS “…the euro will survive because the logic behind its creation is more powerful than ever.” T Blair as quoted in an exclusive interview in the FT magazine this weekend.

• Junius

  David Cameron did appear to show leadership on Saturday with his refusal to countenance a straight in/out referendum, only to wobble on Sunday. As with other aspects of his premiership, he wants to have his pasty and eat it. Mr Cameron says Britain is becoming swamped by EU legislation and bureaucracy. But when asked which specific legislation he wants scrapped, he is stuck for an answer.

  Here Mr Cameron is not alone. Few Tory Eurosceptics appear able to cast any light on what ought to go, other than the Working Time Directive which prevents Gradgrind gaffers from forcing employees to work longer than 48 hours a week. But employees can volunteer to work longer than what amounts to an eight-hour six-day week if they choose. Given a referendum on effectively rescinding worker-protecting legislation such as the WTD and the Agency Workers Directive, the smart money must be on a No.

  Indeed, with three million jobs at risk after a complete withdrawal from the EU, Tory Eurosceptics should be careful what they wish for. In the event of a straight in/out referendum being held, they could well end up with oeuf on their faces.

• Goodgulf_the_Grey

  Three million jobs are NOT at risk. Did we gain three million jobs when we joined the EU? No. Total adult employment is the same now as it was in 1971. See Prof. Tim Congdon demolish this myth on YouTube: “Tim Congdon April 2012″.

  Since we run a large trade deficit with the EU, if three million jobs are at risk here, seven million jobs are at risk in the other EU countries if they refuse to trade with us after we leave. Are they really going to put at risk all those Audi, BMW and Mercedes sales just to spite us? In fact WTO free trade rules mean they cannot refuse to trade with us anyway, even if they wanted to.

  This “three million jobs” figure is a scare story put out by the pro-EU camp and does not stand up to a moment’s scrutiny.

• drnono

  Imagine if Blair/LibDems etc.. had had their way – how much of a bankers paradise would it have been with interest rates at low ECB levels? Would we have seen total bankruptcy in the UK after an even madder boom than we had – just like Ireland?
  Blair is a creature of the bankers, paid millions upon millions per year, – not to make the tea like the bankers say- , but to influence policy weighing in like this. Your stark staring mad to say the EURO will liberate us from the grip of the bankers.

• greggf

  Perhaps the argument over Europe has shifted, or is about to, from technical treaties to that British historical concern of a united power emerging on the Continent.
  Hague says that no decision could be taken on a referendum until “we know how Europe’s going to develop”. Indeed, and this prospect of an EU fiscal union on our doorstep may have awakened more fundamental antagonism to being subsumed into a Continental Power Bloc than that posed by mere treaties, now it seems evident we may not control it!
  Liam Fox’s call for an immediate vote, the stridency of current euro-scepticism and Cameron’s apparent indecision all seem to indicate such a shift in strategy.

• Guest

  we are the largest net importer of BMW cars in the world outside the German home market, If we leave europe Im sure we will continue to suck up german cars like there is no tomorrow, wether the rest of Europe will continue their loyal purchases of our McVities Jaffa Cakes and Duchy Original biscuits is another question altogether.

  Also we have a knowledge based economy now as opposed to the industrial based one we had in ‘71, digital media/technical/electronics/and mechanical engineering industries in the UK work hand and glove with European based partners and they benefit immensely from the economic/managerial/ and operational harmony that the EU allows us, a manufacture of hi tech industrial components for Jet Engines based in Crawley that employs 200 people and has a partnered contractor based in Nanterre in Paris may find it expedient to move its entire operation to Europe if It cannot benefit from the co operation it enjoys from a fellow EU member state.

• ChristopherVonbrincken

  … and Typhoo Tea and Weetabix and Lemon Marmalade.
  I don´t know about Duchy Original biscuits, but advertising with an Hanoverian inbreed with protruding ears – and I am not talking about a horse – on their website doesn´t arouse my interest any further.

• Toocleverbyhalf

  Imagine what would have happened if Britain had been part of the euro club and able to influence its development from the inside instead of carping impotently from the sidelines. Imagine how much stronger the currency would have become and how our allegedly brilliant Chancellor of the Exchequer Ken Clark would have prevented the southern European states from over-borrowing.

  Imagine Europe having become strong enough to challenge successfully the laissez-faire regulatory regime in the US that Britain had little option but to follow and which got us all into this mess. Imagine how strong British industry would have become had it been able to borrow at the low rates its competitors in Germany enjoyed.

  We can all play your fun-packed little game of “imagine what would have happened if” fantasy history….