Leader: A defining moment

Published on Sunday 11 December 2011 01:18

HISTORY’S verdict on David Cameron’s handling of Friday’s historic EU summit in Brussels is likely to be harsh and unforgiving.

No-one was in any doubt about the importance of this summit to solving the euro crisis, which poses no less a threat to the British economy than it does to those within the single currency. The euro countries asked for help and with one exception Europe answered that call. The one exception was Britain. The Prime Minister’s use of the British veto was an extraordinary act. David Cameron says he was doing his job and protecting Britain’s national interest. That is his judgment and it is the right judgment to make, but it is a major decision and will have ramifications for years to come. Is where Britain’s best interests lie over the next few years in this fast-changing economic and political landscape really that obvious now? And were other, cleverer, less dramatic options open to him? Debate now rages about whether Cameron could have secured British interests by negotiation, rather than issuing ultimatums.

The Europeans have always believed that Britain, and particularly Tory Britain, did not really have its heart in Europe. Now Cameron has just confirmed all those prejudices with bells on and put Britain very much on the outside.

Make no mistake, there is real anger at Britain. It could be seen in the way Nicolas Sarkozy blanked Cameron’s attempt at a handshake, and in Angela Merkel’s unusually frank assessment that Cameron was not really “at the table”, during the negotiations. It is going to be hard to come back from that within a generation even as political leaders in Europe change.

So what were Cameron’s motives? The Prime Minister might believe that he was acting in the nation’s best interests, although he does seem to be confusing the City of London with the nation. But there is no doubt that the financial sector is a major part of the economy here in Scotland too.

The slight suspicions arise because that aligns exactly with his own political interests. If he had agreed to a new EU treaty he would have had to accept the need for a UK referendum on the future of Europe. The consequences of such a step are not hard to envisage – an amendment turning the vote into a referendum on whether Britain should remain in the EU; a bloody civil war within the Conservative Party and the destruction of the coalition with the Liberal Democrats. It would, almost certainly, have cost Cameron the premiership.

Adding to those doubts is the fact that the very institution he says he stepped in to save is divided as to his tactics. The potential for a disgruntled Europe to pass laws without Britain’s input that will still have a major impact on British financial trade is perhaps a greater threat than the one that was possibly avoided by the veto.

It is no way certain yet that the euro has been saved. If, tomorrow, the bond markets judge that the new “compact” does not carry the weight that a new EU treaty would have carried, then its harsh verdict could precipitate a euro endgame before the new stability pact has a chance to do its work. If this happens, Cameron and the UK will get the blame. If, ultimately, the euro project fails, Britain will also suffer massively.

Many say the Euro is fatally flawed as a concept and is doomed. But what if the new tight regulations and European unity are what it needs and – slowly – it has the German-based stability to become a very strong currency. No-one should doubt the political capital that Germany and France, in particular, have invested in this project, and their determination to make it succeed. With good fortune and a fair wind, Friday’s new rules could produce a currency and a trading block akin to their original vision. As well as getting the blame for any failure, Britain will not be able to share in any success.

Here in Scotland we have other consequences to ponder, with an independence referendum on the horizon. One effect of the drama of the past few days has been to bring a new clarity to the routes an independent Scotland might take on monetary policy. That each route has huge implications is becoming plain, and it’s clear that major decisions have to be faced on what currency – and what countries – an independent Scotland would ally itself to. There is a strong argument that First Minister Alex Salmond would be foolish to lay down a definitive course for Scotland at this point. Why, for example, nail the Saltire to the euro when that currency may conceivably not exist in anything like its current form in a few years’ time? There are also obvious problems about a newly independent country sticking with the currency of the country from which it has just separated. Salmond must, however, be clearer on the way Scots would be able to express a preference about their future. Would there be a referendum on any decision to stick with sterling, in the way the SNP has promised for adopting the euro? And what about a standalone Scottish currency, an option finding favour among some nationalists this weekend? Would this be another option available to Scottish voters? The pathways to choice need to be more clearly defined.

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SlyFifer

Sunday, December 18, 2011 at 08:56 AM

Bill. A more balanced article from you but still, it could have been written from within the confines of the M25 and be relevent. Almost none of your writings seem to view issues from a Scots perspective, in fact only your last paragraph goes anyway towards that issue. This is perhaps the principle reason why the Scotsperson is failing - daily. Little or no relevence to the 'reality on the ground'. It may gall and stick in your throat but the political landscape changed forever in Scotland, in May of this year. There's almost no going back to the unuonist mindset anymore. What worries does the EU debacle have for Salmond, not much really other that the UK falling deeper into the bail-out mire and the ratchetting up of 'our share of the debt' growing larger every day without any consultation with Scotland as to whether we agree or not. It is not just the SNP who are crafting a way forward for a future independent Scotland. The monetary issues, the future currency, the pegging of currency and the institutions of state are all being addressed by the SDA so Mr. Jamieson, worry ye not !.

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Beachdair

Sunday, December 18, 2011 at 01:54 AM

Excellent article, Bill. In partucular, thanks for recognising (in your final paragraph) that the shrill demands for instant definitive answers from the Scotland office and opposition political parties are pure hysteria.

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bieldmaster

Sunday, December 11, 2011 at 07:26 PM

The EU summit' menage a trois' of Angel Merkel, Nicolas Sarkosy ,David Cameron certainly hoggedt the headlines from Brussels . Non participants ,looking for clarity could easily have presumed that;Germany, France the UK,were the only show in town;the fact that some other 23 countries were there as equlal participants was, apart from a multiplicity of "photo shoots"hardly discernable.. As a fully paid up fan of Machiavellian politics ,it is my opinion he would have made "hay while the sun shone";maybe he was a fly on the wall of the conversations of errant threesome the outcome of which "Old Nick" would have been delighted to claim for his brand of mayhem.With the imminent return of First Minister Salmond to the more mundane politics of Holyrood all can fore see a list of matters requering his immediate attention in the run up to Christmas New Year holidays ;it is self evident that a day is now considered to be a long time in Scottish politics.Alex Salmond ;Welcome back to"Pandamoneium"

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