Daniel Korski

Was the PM reasonable?

Was the PM reasonable?
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As the effects of last week's European Council become clear, debate about the rights and wrongs of David Cameron's diplomacy hinge on one question: were his demands ‘reasonable and modestly expressed’, as a source in No 10 put it to me?

Everyone knows that there were chronic failures in the run-up to the meeting itself. I laid a few of them out in an earlier post, but, basically, they amount to a failure of prioritisation: the UK eroded the goodwill it needed by fighting tooth-and-nail on every issue beforehand, thereby blocking things that other EU states care about but which are not important, except symbolically, to the British. International — and especially European — cooperation is about give-and-take. It cannot just be take.

But the verdict on the PM's diplomacy has to be focused on the reasonableness of the British demand in this case. Nobody doubts that the PM had a right to ask for measures that he deems to be in the British interest, or that are required to pass through the House of Commons with his party's votes. Angela Merkel has pushed for what she sees as in the German interest, and everyone knows she has had to contend with the Bundestag. Having a right, though, is not the same as being reasonable. The former is about why you argue for something, the latter about whether you can bring others along.

So was it reasonable to demand what the PM asked for? Most Europeans I've spoken with — diplomats and EU officials — think not. The Commission President certainly does not. The demands were, they argue, unrelated to the crisis at hand. But so much of the evening's discussions seem to have been unrelated to the Euro. And President Sarkozy has argued that he rejected the Prime Minister's demands because the crisis began in the City. It cannot be both irrelevant and relevant to talk about the City.

What about the specifics? According to Open Europe, the PM pleaded for unanimity to apply on decisions relating to: ‘transfer of powers to EU supervisory agencies, the use of “maximum harmonisation”, issues impacting on fiscal interests of member states (taxes & levies) and the location of EU Supervisory Authorities (ESAs).’ And here the picture is mixed. To move to unanimity in an area that had previously been under QMV was seen as an unreasonable — and a big step back from existing EU law. 

But the UK counterargument could be that, given statements by Jose Manuel Barroso and President Sarkozy about taking on the City, the spirit of the Luxembourg Accords — which protects states who rely on a special industry — seemed weak. The key point is that UK did not seek any form of special treatment and, in pushing for ‘maximum harmonisation’, was in fact looking to regulate more than the EU is planning to. Denmark fought the same kind of battle with the European Commission over rights to tighten environmental standards over and above the minimum standards. Should the PM have had a shorter list? Probably.

What will happen now? Nobody knows. The Danes look like they won’t go for a referendum, but the Irish probably will. Here in Britain it is in Nick Clegg’s interest to persuade Cameron to see if most of the intergovernmental treaty’s provisions could be implemented through normal EU procedures, where the UK still has a say (albeit under QMV), while the treaty document itself could be limited. The point would to make it more attractive for the EU-26 to do business outside the new treaty than inside. However, this will require giving something more to EU allies as a sweetener than the UK has been used to offering — for example, on the EU budget of European defence — and not blocking the use of the EU institutions for the Eurozone’s usage. 

Right now, it is not clear if the PM ready to accept that, or whether he will prefer to stay in Boudicca mode.