Angela merkel

A taxing kind of spin

The story being briefed out of the year’s first Franco-German Summit is that President Nicolas Sarkozy won the backing of Chancellor Angela Merkel for a tax on financial transactions, a levy that the British government objects to and that Ernst and Young say would leave a €116bn hole in Europe’s public finances. But before the City begins building barricades and the PM puts on his bulldog mask, it is worth taking another look at the news from Berlin. For no sooner had the agreement been announced than the tax was rejected by Chancellor Merkel’s junior coalition partner, the pro-business Free Democrats, who say they will only back a Europe-wide tax

Happy New Year from world leaders

It’s the New Year — a time when politicians all over the globe get on their soapboxes and preach to their people. From Merkel’s pledge to do everything for the euro, to North Korea’s vow to defend their new leader unto death, to Putin’s speech laden with sexual innuendo, here’s a selection of this year’s messages from world leaders: Barack Obama: ‘I promise to do everything I can to make America a place where hard work and responsibility are rewarded, one where everyone has a fair shot and everyone does their fair share. That’s the America I believe in.’ Angela Merkel: ‘Today, you can trust that I will do everything

26 versus 1 — really?

Judging from much of the coverage in UK media, you would be forgiven for thinking that Britain is on the fast track to becoming the North Korea of Europe — eccentric and completely isolated from the rest of the world. Indeed, the media narrative over the past couple of days has largely treated the agreement reached at the summit as concrete, supported in full by everyone apart from Britain. Or ‘27-minus’, as Commission President Jose Manuel Barroso put it. The reality, of course, is quite different. Leaving aside whether Cameron could have played his cards better (he could have), as Gideon Rachman pointed out in yesterday’s FT, ‘the picture of

Ten myths about Cameron’s EU veto

The EU veto that Cameron pulled in the early hours of Thursday morning has been widely misunderstood on all sides. Here are the 10 most common myths: 1. Because of Cameron’s veto, Britain lost a seat at the negotiating table. Not true. The UK was never itself going to take part in the Merkozy pact (and potentially be subject to EU sanctions), and therefore not in the monthly, parallel EU meetings that will begin in January, either. Even if he had approved the Treaty changes, Cameron still would not have had a seat at the table. Wider political challenges aside, the veto didn’t change anything structurally in terms of UK

A dozen questions for after the Brussels summit

Cameron will be depicted in tomorrow’s press as either a Tory Boudicca or an Essex Bulldog (© Tristram Hunt), depending on your point of view. I suspect the truth is somewhere in between. Cameron did not go in swinging a handbag, although it will suit No10 to make out that he did. But Labour’s caricature of him storming off and wasting the veto certainly doesn’t ring true to me. An EU27 deal was never likely, and EU17 deal always was. Cameron, on their account, just seems to be being blamed for what was going to happen all along. In any case, we are still trying to assemble the pieces of

The Merkozy Plan fails to convince

A day or so ago, the markets were rising in anticipation of what might be achieved at this Brussels summit. But this morning they’re mostly either unmoved, or — as in the case of borrowing costs in Italy and Spain — shifting in unpropitious directions. No-one, it seems, has been won over by yet another night of political bargaineering in Brussels. And understandably so. None of the measures mooted this morning are particularly concrete; all have a sogginess about them. More cash will be transferred to the European Financial Stability Facility, but it’s still some distance short of the €1 trillion that was, ahem, ‘announced’ at the end of October.

James Forsyth

A defining moment

David Cameron’s use of the veto in the early hours of this morning changes the British political landscape. The first thing to stress is that if the euro collapses it will not be because of the British veto. The deal agreed between the 17 eurozone countries and six of those nations who still want to join it does not address the single currency’s fundamental problems.   What is, perhaps, most intriguing about what happened in the early hours of this morning is that Sarkozy and Merkel chose to put Cameron in this position. In truth, Cameron was not asking for that much. But Sarkozy and Merkel were not prepared to

Fraser Nelson

Cameron says ‘No’

It looks like Britain could be heading for renegotiation with the EU sooner rather than later. The UK, Hungary, Czechs and Swedes last night stayed out of a 27-member EU Treaty. ‘I don’t want to put it in front of my parliament,’ said Cameron. But in an historic move, the deal is going ahead anyway, with 23 members: the Eurozone, plus the six states who want to join. ‘We will achieve the new fiscal union,’ said Angela Merkel. Nicholas Sarkozy is upbeat saying it has been an ‘historic summit’ which will change the EU ‘radically’.  If so, then Owen Paterson is right in his interview with James Forsyth in the

Europe is the story again

Today was one of those days when we saw just how divisive the European issue can be to the Conservative party. The sight of Malcolm Rifkind and Nadine Dorries treating each other with barely disguised contempt on Newsnight was a sign of just how poisonous relations in the parliamentary party could become. Intriguingly, the Daily Mail reports in its first edition that ‘Even some of Mr Cameron’s closest Cabinet allies are understood to be shifting to a much more Eurosceptic position, with a five-strong group of ministers planning to visit the Prime Minister as early as today to urge him to toughen his stance.’ Cameron now finds himself trapped between

Cameron’s plan

Much ado about a Cabinet split over Europe this morning. The Financial Times has interviewed Ken Clarke, whose europhile instincts are well known — something he shares with the senior Lib Dems. Clarke tells his eurosceptic colleagues not to expect powers to be repatriated from the EU at Friday’s summit. Meanwhile, David Cameron has written a piece in today’s Times (£), reiterating that he will veto any treaty that damages British interests. He also says that his ‘requests will be practical and focussed’. And therein, apparently, lays the split. The word ‘requests’ might open the possibility of repatriation. Cameron appears to be hedging his bets ahead of Friday’s summit, lowering his more

Yes, Virginia, History Matters: Eurozone Edition

Broadly speaking, there are two ways of viewing the eurozone crisis: it’s a problem of economics or a problem of politics. Neither explanation quite suffices, of course, since it is both but the emphasis you place on economics vs politics plays a part in how you’ll view the situation and how likely you are to think there’s any kind of solution that can satisfy the politics and the economics of the situation. Which is by way of suggesting that plenty of American commentators seem to think the problem is easy to solve and the main thing lacking in europe is the political will to do something about it. (Exhibit A:

The Gospel according to Delors

An old enemy of England nestles in the pages of today’s Daily Telegraph. Charles Moore travelled to Paris to meet Jacques Delors, the architect of the euro and advocate of Europe’s ‘social dimension’. Moore found defiance where one might have expected humility, perhaps even repentance. Delors insists that the fault was in the execution not the design of the euro. He thinks that the euro’s ‘Anglo-Saxon critics’ were correct in their analysis of the euro’s structural failings; he believes that Europe’s political leaders did not go far enough in ‘founding [economic] co-operation between member states’, which would have promoted the beloved ‘social dimension’ by harmonising fiscal, welfare and employment policies.

A tale of two cities | 2 December 2011

Nicolas Sarkozy is grudgingly admired by French socialists as a political fighter, capable of thriving even in the most desperate situation. David Cameron is coming to understand what they mean. It is the best of times and the worst of times between Paris and London. Two months ago, David Cameron and Nicolas Sarkozy assumed the victor’s garlands in Benghazi; today, they met at odds, if not yet in animosity, over the contested logic of ever closer union in Europe. Sarkozy appears to have got his wish: the 17 countries of the Eurozone will deepen their economic and political relations in an attempt to save the single currency — and with it, he

James Forsyth

Merkel’s fiscal union won’t solve the euro’s problems

Few people have been as vindicated about the failings of the euro as Marty Feldstein, who was chairman of the Council of Economic Advisers under Reagan. In 1997 he wrote a piece for Foreign Affairs called ‘The EMU and International Conflict’. In it, he argued that far from furthering peace and stability in Europe, the Euro would actually endanger it. Watching the events of the past few months, few could disagree with him. Feldstein has now returned to the debate pointing out that none of the current fixes being suggested will solve the single currency’s problems. He writes: ‘Although the form of political union advocated by Germany and others remains

Meanwhile, in Europe…

There probably hasn’t been a meeting of European finance ministers as important as the one tonight. The euro is still at risk; with new governments in Spain, Italy, and Greece incapable of calming the markets, and Angela Merkel unwilling to let the ECB act. In a speech in Berlin, Polish foreign minister Radek Sikorski put it clearly: ‘I fear German power less than I am beginning to fear German inactivity.’ It is a fear shared in London and Paris as well. The 17 finance ministers will discuss the range of options on the table: from setting up an EU Treasury to the possibility of eurobonds or establishing a supra-national process

The reasons for Angela Merkel’s popularity

The British government is becoming ever more gloomy about the prospects for the euro, believing that Angela Merkel will not do what she has to if the single currency is to survive: namely, let the ECB intervene massively in the markets. Whether it’s because of Germany’s inflation-scarred history, or the hope that market pressure will force reforms in many European states, the Chancellor is holding back. And, it seems, she is getting more and more popular by sticking to her policy.   Mrs Merkel’s popularity is, indeed, related to her handling of the Eurocrisis. In Germany she is seen as having shown the kind of leadership people want, and the

Paying for justice

To British ministers, the role that the International Criminal Court played over Libya was key – it made clear that Colonel Gaddafi’s actions were unacceptable and would be subject to international law. Tory MP Dominic Raab even wrote a piece in The Times about the need for Libyans to rely on the ICC in The Hague, rather than seek retribution and revenge against Gaddafi and his loyalists. And it wasn’t only the British government. German Chancellor Angela Merkel stated that the Libyan leader Muammar Gaddafi should be tried by the ICC: ‘Gaddafi should have a trial according to the law, something he never did with his opponents,’ Merkel said when

The dangers of ever-closer union

Yesterday, Fraser wrote that ‘reporting of European issues tends to ignore public opinion’. Today, Philip Stephens has neatly illustrated Fraser’s point in his Financial Times column. Musing on Britain’s possible exit from the European Union, Stephens writes: ‘I am not sure this is what the prime minister intends; nor, when it comes to it, that British voters will accept such an outcome.’ Stephens’ conjecture ignores the European Union’s own polling, which, as Fraser says, shows most Britons to be hostile to the EU. That said, Stephens’ article is substantial. He argues that ‘fiscal union carries its own remorseless logic: the progressive exclusion of Britain from Europe’s economic decision-making’. The magnitude of George

How ambitious is Cameron on Europe?

Someone forgot to pack his handbag. We heard yesterday that David Cameron has agreed to let Merkel pursue full fiscal union – and in return she will… drum roll please… let him repatriate parts of the Working Time Directive. There’s nothing official from Number 10, but the well-informed Ben Brogan suggests this morning that this could well be Britain’s price for agreeing to Merkel’s deal. If so, this would be an opportunity squandered on a massive – perhaps historic – scale. Let’s recap. Cameron is in an incredibly powerful position: leading a government which is, in defiance of public opinion, giving £9 billion of overseas aid to EU member states each year.