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Saturday, 5th November 2011

The paradoxes of renegotiation

Daniel Korski 11:48am

David Rennie (aka The Economist's Bagehot) has an excellent column in this week's issue about the difficulties that Britain will face if she tries to repatriate powers from the EU. His main argument, having spoken to a number of senior German politicians and officials, is that if Britain holds up any treaty revisions in the hope of extracting concessions in return, then the other EU states will organise themselves without the UK.

The Economist's former Brussels correspondent also makes the key point that the 10 countries that are outside of the euro are not natural allies for the UK – some, like Denmark, do not want to join the euro, but others such as Poland are keen.

The bottom-line: Britain cannot run a "core" strategy – as the eurozone members are not likely to take UK advice – but nor can it run a "periphery" strategy either, as there is no confluence of interests with the most important non-euro members. If true, this should be a sobering thought to the British government but especially to the members of the 81 Group. Huffing and puffing will not make it easier – or even possible – to renegotiate the UK's EU relationship. For a negotiation requires that you either have something to give up, or threaten with. The UK, The Economist is arguing, has neither. Let's call this the "Rennie Rule".

But like all EU-related rules this one also has a few opt-outs. If the UK holds up treaty change the other member-states could, in theory, cooperate regardless. However, this form of European cooperation would have to take place without the EU institutions – the European Commission, the European Parliament, the ECB etc as any changes to their mandates would require UK consent. In other words, the most integrative parts of the EU would be without the EU. And nobody in Berlin, Paris or Rome want that. So the UK does have a bargaining chip, albeit a small one.

Two important points flow from this. First, any form of renegotiation can only take place if those negotiating – principally the UK, Germany and France – trust each other and work in an atmosphere of consideration. So the antics of the 81 Group will make it less, not more, likely that the UK government will succeed in any renegotiation.

Second, a renegotiation strategy can only succeed if it is reasonable. The government has encouraged its backbenchers to be unreasonable and so they will use any opportunity – eg the Accession Bill for Croatia – to "up" their demands for a pull-back. But it will be in the Prime Minister's interest to very quickly lay out what he believes can be renegotiated, what might be renegotiated and what cannot be renegotiated. This is where the Special Negotiator comes in, as I've argued before. The key is that once he has said what he wants – and can get past Nick Clegg – the PM must fight to the death for his new line.

Filed under: David Cameron (1913 more articles) , European Union (163 more articles) , Eurozone (100 more articles) , France (246 more articles) , Germany (146 more articles) , UK politics (5408 more articles)

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Heartless P.

November 5th, 2011 12:06pm Report this comment

Do I spot the digit of the H2B wagging at She Who Must Be Obeyed?

Oy vay!

Jayu

November 5th, 2011 12:23pm Report this comment

Cameron fight to the death? That has to be the best joke I've heard so far this weekend. In order to do that he would have to be a conviction politician. He has proven himself to be many thing, a conviction politician not being one of them. I doubt he would even fight to the death to save his own job.

Widget

November 5th, 2011 12:23pm Report this comment

Cameron's difficulty in negotiating the repatriation of powers will have zilch to do with the 81 group and everything to do with acquis communautaire and all that.

The EU oligarchs won't relinquish a inch of ground they've managed to grab. It's a;; part of the Plan.

(BTW, how come the EU were granted those powers in the 1st place?)

disenfranchised

November 5th, 2011 12:25pm Report this comment

well of course they will organise themselves without the UK, the thankless throng (even though we contribute more que vous, sarky).
please god, may UKIP (and brave nigel) save us from these fanatical foreigners.....

Charlie the Chump

November 5th, 2011 12:38pm Report this comment

Nothing to give up or threaten with eh? What about witholding billions of £'s in our substantial contributions??

And if the EU core wish to go ahead without the UK then the UK can go ahead without them and leave to forge links with growing areas around the globe including commonwealth countries.

Also, though our 40% of our exports currently go to Europe, this will continue to shrink as the turgid economic and labour policies of the EU continue to strangle their global competetiveness. And EU exports to the UK mean they have to keep us in some sort of economic relatinship or cut off substantial revenues.

No. We must remain firm and keep our resolve but it is true Cameron does have to get his finger out and decide what he really wants for the UK.

Slim Jim

November 5th, 2011 12:40pm Report this comment

This article confirms what many people are thinking - Better Off Out!

Dave H

November 5th, 2011 12:43pm Report this comment

You are assuming a particular definition of 'renegotiation' that is different from the one I prefer. To me, the obvious course is to quit the EU and then, mindful of the number of citizens of other EU countries over here and British citizens over there, and the fact that a lot of EU companies have trading links with Britain, we can talk about treaties to allow all of that side of things to continue with minimal change. It is quite possible that the leaders of other countries would rather wreck the trade and repatriate people rather than see sense, but one would hope that reason will prevail.

Rhoda Klapp

November 5th, 2011 12:46pm Report this comment

Right premise, wrong conclusion. It is true we cannot realistically expect to repatriate any powers or get any treaty change of the kind we would want. That's why we have to seriously address the question of how we can leave. The bus is not going to where we want to go. Time to get off. Korski, who never met an international organisation he didn't like, can't get to that conclusion. May I ask him to state what our ideal relationship with the EU is? A question I've asked a few times in the last week, with no answer from any of the europhiles. Leaving the position that I'm a loony to want to quit, but they can't say why they want to stay. (Note, not why it is wrong to quit, but what is so damn good about being inside.) How about one of those another voice things saying what is good about the EU we have now. No, not some idealised version, but the one we have right now, bureaucratic, interfering, all-encompassing, anti-democratic, ugly.

Craig Mitchell

November 5th, 2011 12:53pm Report this comment

The UK is a net importer from the EU and contributes a substantial amount of money to the EU's budget; we could simply deploy St. George's cavalry and withhold payments until our conditions were met.

2trueblue

November 5th, 2011 1:05pm Report this comment

"A renegotiation strategy can only succeed if it is reasonable"? What exactly does that mean. We know that Cameron is not a eurosceptic, we know that this country is now run by the LibDums, and the foreign office, on that subject. So where exactly does that leave us? Reasonable to whom?

Cameron has so far shown no real appetite or inclination to give us any say, or to take on Brussels in any meaningful way, (or the foreign office). The foreign office think they are there to look after foreigners and to whom does Cameron owe his allegiance to? He did not clarify where he stood during the election campaign and frankly I do not think Cameron has a strategy for anything. He may be smart, can produce a speech without paper, but frankly that is not what makes a good statesman and that is what he really lacks. Needs to try harder.

Publius

November 5th, 2011 1:06pm Report this comment

Sorry to be blunt, Korski, but this is pure unadulterated bullshit.

Your argument, such as it is, boils down to: You will get only what is reasonable. If you don't get it, it wasn't reasonable. The "antics of the 81 Group" are not resonable.

You really are part of the goddam problem, Korski. I don't give a damn what Germany and France think they will allow. Our sovereignty is inalienable, and we do not need to negotiate with anyone to lay hold of our birthright.

John

November 5th, 2011 1:09pm Report this comment

We do have something to give up or threaten with - the money we pay.
as such a large contributor to the EU pot threatening to cut our contributions in a time of great austerity should be a big enough stick/carrot.

nonny mouse

November 5th, 2011 1:10pm Report this comment

>>if Britain holds up any treaty revisions in the hope of extracting concessions in return, then the other EU states will organise themselves without the UK

That is not a problem. We should encourage it.

The Euro Zone needs to be a single nation state to go with the single currency. I call it the European Federation.

The single market should be outside it. I call it the European Market.

The European Union should be superceded by these two bodies.

We should help them by putting forward a model for Europe based on these two bodies and making sure that we keep what is important to us - the European Market, but give up control of the part that we don't want to be in, the European Federation.

Sally Chatterjee

November 5th, 2011 1:17pm Report this comment

Renogiation might work, it might fail. But we have lots of powers already. Look at the 40 and 50% tax brackets that are amongst the highest in the G20, look at the minimum wage that prices many out of work, look at the waste across local governments. We do nothing about these things because politicians are too scared to act. Blaming Europe is one thing but I worry it is a form of cowardice for politicians too scared to act at home.

I'll trust a politician with repatriated powers once he's shown me he can fire thousands of lazy council workers thank-you!

Leadfoot

November 5th, 2011 1:35pm Report this comment

'a renegotiation strategy can only succeed if it is reasonable'

Absolute rubbish! Success in negotiating usually results from a position of strength which the other side will always see as unreasonable. Our position of strength is the ability with withhold a very sizable chunk of cash.

Having said that, I'm all for leaving completely and just working as a free trade area. Our future is trading with the rest of the world - not the EU, which very soon won't have any money to buy anything off anyone.

oldtimer

November 5th, 2011 1:46pm Report this comment

You refer to the "antics" of the 81 MPs. I think they raise very pertinent questions, questions that are too important to be determined by the Parliamentary whip.

It may well be the case that France and Germany will dig in over agreeing to repatriation of powers and insist that the UK accepts all or nothing. In that situation the decision is clear; we should exit the EU. That is the choice for the UK; it is also the choice for the EZ countries.

Duyfken

November 5th, 2011 1:47pm Report this comment

Mr Korski, you use a phrase such as "the antics of the 81 Group", as a disparaging reference and which betrays your own leanings on the matter. The only realistic conclusion one should draw from your article is that it is and always shall be useless trying to negotiate or renegotiate terms within the EU. That is precisely why I decided some time ago that the only realistic solution is BOO, and may you also learn this basic truth - sooner rather than later.

Alex

November 5th, 2011 2:01pm Report this comment

Sheer stupidity from Mr Korski. As others have pointed out, the EU is dependent on British money, which makes their arrogance towards us so ridiculous. All we have to do is be willing to make good on the threat to withdraw supply and we can get whatever we like from them - or we can get out, which is just as good really. It's win-win, or it would be if Mr Cameron could muster up some courage.

havena clew

November 5th, 2011 2:10pm Report this comment

I have heard enough of the PM being a eurosceptic - most of his actions suggest otherwise.
Besides, there are levels of euroscepticism.
And he knows that renegotiation would almost certainly contribute to the break up of the United Kingdom.
That would be sad.

Augustus

November 5th, 2011 2:10pm Report this comment

Whatever value the EU as a federation had the fact is that the Union has been devalued
to an extremely immoral degree. To insist, for example, that all members of the eurozone had to be glued together for the sake of nothing more that a utopian socialist agenda is a gross immoral political act. Countries such as Greece can, under such rules, remain mired in their own unreformed state secure in the knowledge that others will bail them out. They can, in effect, blackmail more prosperous and hard-working countries.

Verity

November 5th, 2011 3:17pm Report this comment

In the photo, anyone besides me clock Merkel's hostile, raised shoulder while Dave the Knave addresses her?

Hint to Dave: She doesn't like you and she doesn't care what you have to say.

Neil McEvoy

November 5th, 2011 4:00pm Report this comment

"For a negotiation requires that you either have something to give up, or threaten with. The UK, The Economist is arguing, has neither."

You'd have thought they'd have heard of money at a journal called The Economist.

NickW

November 5th, 2011 4:27pm Report this comment

I thought that the latest Sarkozy wheeze was that France and Germany would go it alone together as a "core" Europe.

Unfortunately for Sarkozy, Frau Merkel has quietly pointed out to her close confidantes that France is actually closer to Greece than to Germany.

The EU is undergoing a huge period of change, (a.k.a self destruction), which is happening so fast that a renegotiation tactic which was plausible one week becomes implausible the next.

One thing is clear; when Europe substitutes threats for diplomacy as Sarkozy has done, then this Europe is no longer the kind of organisation with which any free and democratic Country should have any relations whatever.

Now the gloves are off and bullying and threats are being used openly, the situation can only worsen, and it is in the nature of such things that the situation WILL worsen.

The totalitarian, domineering, bullying, suffocating superstate will be on our doorstep before we know it.

Noa.

November 5th, 2011 5:43pm Report this comment

Daniel

Given the manner in which you write about negotiations it is apparent that you have never planned or conducted one.

Firstly, let us dispel ourselves of the pernicious, reactive notion that these are re-negotiations. They are not. They are negotiations. Period. And nothing must be unthinkable, barred or off the table.

To emphasise this and to put the other side on the defensive, the UK must commence the negotiations and pre-empt the EU's key card, by declaring its intent to leave. Rhoda Clapp has pointed out this out before but you haven't noticed, or absorbed it if you have.

If this is considered to be objectionable the suspension of all further financial contributions until satisfactory audited accounts are produced should announced.
The implementation of existing and future EU Directives will also be suspended forthwith.

Where might the negotiations be held? Well using the Tower of London should help to align the teams' thoughts and goals. Carisbrooke Castle would also achieve this.
What should the negotiations deliver? Nothing less than the full restitution of UK sovereignty and so, self determination on all constitutional and Territorial matters.

It should be clear from the outset that continued, conditional EU membership on the terms negotiated shall be subject to a referendum and ratification by Parliament.

Alternatively we could just simply withold payment and enjoy the spectacle of the whole rotten mass sliding into insolvency.

Noa.

November 5th, 2011 5:59pm Report this comment

Who should lead negotiations?

Certainly not the collective of appeasers and failures that have brought the UK to its current dire state. No Pattens, Mandys, Alexanders or Cables.

Pick a real negotiator, a man or woman, with vision, ability and determination.Someone who has done deals with the best and toughest opposition in the world, has developed and lead a world beating successful industrial enterprise.
My own nominations would be Sir Kevin Smith from GKN, Sir John Rose from Rolls Royce or Lord Hesketh.

Herbert Thornton

November 5th, 2011 6:12pm Report this comment

I keep saying this, but I believe it's worth repeating -

Japan manages very well on it's own without being a Province of China (indeed it probably manages better). So why can't Britain also manage very well indeed without being a Province of Europe?

Noa.

November 5th, 2011 6:37pm Report this comment

Verity 3:17pm

"In the photo, anyone besides me clock Merkel's hostile, raised shoulder while Dave the Knave addresses her?.."

No, I think that, Clouseau-like, her false hump has slipped down.

Dennis Churchill

November 5th, 2011 7:31pm Report this comment

Do the French have problems needing to “give up” in order to negotiate ?
As John wrote above we are negotiating from a position of strength as we are both a net contributor and run a trade deficit in the region of £30 billion a year with the rest of the EU.
Do you think they would endanger that? Or that France would pick up our tab if we left?
A cost benefit analyses would show we would be better off out, which is why there has never been one.

john

November 5th, 2011 7:41pm Report this comment

TRUST !! How can you talk about trust ? Didn't Bliar sacrifice some of the rebate for reform of the C.A.P. What happened there then?!
Renegotiation - pah ! When did the EU ever return any powers ?! Are there any examples ?!!

Cynic

November 5th, 2011 8:32pm Report this comment

Thank you for making the point that renegotiation is an impossibility. The conclusion therefore must be that the only way is OUT.

Yow Min Lye

November 5th, 2011 10:03pm Report this comment

What we need is a Winston Churchill. Instead, if Daniel Korski is representative of our movers-and-shakers, we appear to be governed by a gaggle of Lord Halifaxes.

Noa.

November 6th, 2011 12:26am Report this comment

Douglas Campbell-Bannerman's thesis outlining why getting out is easier and better than many think:

http://www.dcbmep.org/images/The_Ultimate_Plan_B.pdf

Thomas

November 6th, 2011 7:22am Report this comment

Antics (n.pl.) voting for what your constituents want and not what your party leader wants.

Dimoto

November 6th, 2011 10:06am Report this comment

nonny mouse:

Correct.
Of course negotiations need to be held in a good atmosphere, but Merkozy made it pretty clear this week that they regard the UK as an annoying irrelevance in their grand empire building project.

I reckon they might quite welcome some key opt-outs for us, in exchange for Cameron's solid support/acquiescence in their project (no, NOT more money).

I don't see why we should try to fight the battles for a sane Euro-union, when most of the smaller countries which would benefit (and in many cases preserve their recently won freedoms), just insist on behaving as wide-eyed German groupies, marching willingly into the maw of the beast.
We need to be far more hard-headed and forget the FO's half-baked schemes for alliances.

BTW, the Economist and it's key columnists, come from the same stable as the FT Europhilliacs, they have always dismissed the chances of 'renegotiation'.

Dimoto

November 6th, 2011 10:11am Report this comment

Noa:

The main thing "slipping down" from Merkel, was the careful pretence that the Germans are only acting in the EU's best interests.
The mask really slipped this week.

Widmerpool

November 6th, 2011 10:41am Report this comment

Fine but faint heart never won fair lady !Cameron must go for all he can get but at the right time.
Cameron is not alone in thinking EU labour laws are no good-see below.

Just look at how the boss of the Chinese Sov. Weath Fund is quoted in the Telegraph
"the chairman of the supervisory board of China Investment Corporation, the country’s sovereign wealth fund, put further distance between China and the eurozone bail-out, saying that Europe’s bloated welfare state meant that people did not work hard enough.

“I think if you look at the troubles which happened in European countries, this is purely because of the accumulated troubles of their worn out welfare societies,” Jin Liqun said in an interview with Al Jazeera television. “I think the labour laws are outdated – the labour laws induce sloth, indolence rather than hard working. The incentive system is totally out of whack.”

Time for the overpaid Eurocrats to be reeducated in the country side preferably Western China? Ha Ha

bojimbo

November 6th, 2011 11:53am Report this comment

difficulties that Britain will face if she tries to repatriate powers from the EU.

British government ; nothing to do with the People ( we don't get a say ) .

boudicca

November 6th, 2011 4:23pm Report this comment

If the choice is between the current status quo or simply get out and go it alone - the British people will choose out.

If Cameron attempts a repatriation of powers and the EU refuses to permit anything meaningful, it will just push more people towards OUT.

Lib/Lab/CON may think it can bow down to rule from Brussels and refuse to listen to the British people forever, but it will come badly unstuck. The genie is out of the bottle: a majority want a Referendum and want out. Sooner or later we will get our way - over the dead body of the annhialated LibDems and the seriously weakened Lab/CONs.

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