Tim Montgomerie

The bomb in the living room

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During the last parliament William Hague likened the issue of Europe to an unexploded bomb at the heart of the Conservative party — best leave it alone, or it might well detonate. But it still dominates British foreign policy. However far David Cameron has travelled in search of a different world — paying tribute to Nelson Mandela in South Africa or inspecting melting glaciers in Norway — he would always return to find this huge relic from a previous war sat in the middle of the Tory living room. Beneath the everyday hubbub of Westminster life that persistent ticking noise comes from this enduring issue of British politics.

The mass of the Conservative party understands this, and wants the bomb defused. Even Margaret Thatcher took time to convert to the Eurosceptic cause, but in her landmark Bruges speech she was clear about her vision of a more democratic and dynamic Europe. Michael Heseltine and the party’s other Europhiles hoped they’d killed her vision when they executed her premiership. They were wrong. Thatcher the general may no longer be on the battlefield but her grassroots army remains. The Europhiles are a dwindling and ever-less-relevant minority. At every opportunity Tory members (and British voters) have replaced MPs from the Heath era with MPs in the Thatcher mould.

It is forgivable that the Conservative party’s opponents should fail to understand this movement. Even now — when every warning about the single currency has been vindicated — the Eurosceptics are still dismissed as the frothing-at-the-mouth, swivel-eyed, blazers-and-ties Little Englander brigade. But David Cameron and his circle should know their own party better. They took refuge in the polls that superficially appeared to say that Europe didn’t matter to voters. It is unclear how Cameron, an adviser to Norman Lamont on Black Wednesday, could fail to understand the pervading relevance of Europe. The erm debacle ruined the tories’ economic reputation for a generation.

At its best, Euroscepticism understands that our current relationship with Brussels chains us to a sinking economic ship. It’s not just the euro that is failing but the whole European economic model. High taxes to fund welfare states. Agricultural subsidies. Protectionism. Red tape. The euro crisis should be a signal to change course, but instead the eurozone leaders are doubling down on the old, failed model. Most Tories believe that economic recovery will begin when European economies break free from the eurozone straitjacket. They know the break-up will be painful. Essential surgery always is.

So what explains David Cameron’s misalignment with his party and country? Perhaps his closeness to EU leaders. Perhaps because there are too many like Nick Clegg and Ken Clarke in his Cabinet — and not enough like Iain Duncan Smith and Owen Paterson. Perhaps because he’s instinctively cautious. Whatever the reasons, it is now sadly clear that Cameron is not going to fight to change Britain’s relationship with the EU. He is talking of ‘safeguards’, not repatriation.

He will probably survive this episode. The economic peril is so grave that enough Tory MPs may buy his argument that now is not the time to rock the boat. But this will be the third great disappointment of his leadership. He will be the Tory leader who couldn’t win a majority against Gordon Brown. He’ll be the Prime Minister who did not use the economic crisis to fundamentally reform Britain’s tax system. And he’ll be the poker player who, at Europe’s moment of maximum weakness, gave up his cards before he even reached the negotiating table. It is not a formula for greatness.