Last Friday marked another turning point in Britain’s relationship with the EU. After hours of marathon talks at the European Council meeting in Brussels, 26 member states agreed on changes to the treaty of Lisbon that would potentially save the eurozone. Members agreed to stricter budget rules and a stronger fiscal union. All member states that is, except for Britain who effectively vetoed the offer on the table.
By vetoing the proposed treaty change, David Cameron has taken a risky gamble. Cameron argues that the amendment was not ‘in Britain’s national interests’ and that he was safeguarding the City of London (the same City that depends on business from EU member states and therefore should expect some input from those member states when it comes to regulation).
Sources claim that Cameron sought a separate legally binding protocol to protect the City of London from further EU financial regulations, protection for US financial institutions based in London that do not trade with the rest of Europe and an agreement that any future changes would require the unanimous backing of every EU member state. It can come as no surprise that the other EU member states found these demands for preferential treatment unreasonable and were unwilling to compromise. Had Cameron negotiated harder, longer and smarter he may well have reached a better deal for the City and a compromise that was acceptable for Britain and other EU member states. After all, isn’t a deal that saves the Euro in Britain’s interests too?
By playing his trump card too early Cameron has used his veto but stopped nothing. The planned treaty amendment will steam ahead. As the Centre for European Reform point out, Britain has never been outvoted on a single piece of EU financial legislation. The EU will continue to move forward and Britain has been left behind. David Cameron can at least take some comfort in the fact that the die-hard Eurosceptic fringes of his party will see his performance at the European Council meeting as victorious. Cameron’s decision is bitterly disappointing. For forty or so years, Britain has operated a successful foreign policy that has allowed it to build good relationships with its European neighbours. A critical element of that foreign policy was that Britain was there, sat at the table when EU bodies made decisions. Now Britain’s position has been weakened with less influence amongst those neighbours and it is viewed as an outsider, a difficult and reluctant partner.
Britain has not left the EU and nor is it likely to do so. It remains part of the single market, albeit from a marginalised and isolated position. Less than two months have passed since MPs voted overwhelmingly not to hold a referendum on EU membership but the future of UK-EU relations looks grim, particularly while David Cameron is Prime Minister.
This week, the members of the Backbench Business Committee in the House of Commons agreed to hold a debate and vote on calls for a referendum on Britain’s EU membership. The vote, which takes place tomorrow, is extremely ill-timed given the severity of the Eurozone crisis. Today EU leaders, including David Cameron of course, are holding emergency talks in Brussels on the financial crisis and measures that will keep another recession at bay. The UK has always had an awkward, difficult relationship with the EU but leaving the Union would be madness.
Without EU membership, the UK would become isolated from its neighbours. The EU is a global actor with 500 million citizens and by withdrawing its membership, the UK would no longer be part of the strong voice that Europe has on the world’s stage.
An exit from the EU would result in the immediate loss of the benefits the UK has from being part of the European Single Market. Free movement of good, capital, services and people would be gone overnight. Eurosceptics have advocated a ‘trade-only’ relationship with the EU, but realistically why should member states have to resign themselves to dealing with the UK on uncompromising terms that most likely will favour the UK? Being part of EFTA (the European Free Trade Area that includes Norway, Iceland, Switzerland and Lichtenstein) is hardly the same as having full EU membership. Iceland itself is in the midst of accession negotiations and is expected to join the EU by 2014. Furthermore, the EU is at the dawn of a whole new generation of free trade agreements with other parts of the world – most recently with South Korea, a country with enormous economic potential. If the UK leaves the EU, it cannot participate in these new free trade agreements. Negotiating its own agreements with partners would take years.
The biggest dilemma facing the EU now is the Eurozone crisis. If a resolution can’t be found then the consequences of a new recession or a failed single currency would be catastrophic. The UK may not be a member of the Eurozone but as an EU member it has a responsibility to help find a solution to the crisis. The problems are simply too grown-up, too serious and too complex to be overshadowed by Conservative party backbenchers yelling for a ‘return of our powers from Brussels’ or ‘renegotiated terms.’ The rules are there to ensure members are on a level playing field with each other. Why should the UK receive preferential treatment?
European integration has helped to bring peace to Europe for the past fifty or so years. Historically, Europe is one of the most belligerent places on Earth and Europeans have fought each other for thousands of years. Countries that have positive relations with each other, close diplomatic ties and that depend on each other for trade, investment and other resources are simply less likely to go to war with each other.
Earlier this year, Parliament passed the European Union Act which ensures that no further powers will be transferred to Brussels without the approval of a nationwide referendum. Consequently, the whole debate on the UK’s EU membership and the justifications for renegotiating membership terms or withdrawing all together have never seemed more irrelevant.
The UK belongs in the EU. It has a shared history, culture and identity with the other EU member states. By leaving the club that it waited so patiently to join in 1973, the UK would undoubtedly be worse off. Times are tough and the EU is currently sailing through a terrifying storm, but now is not the time to abandon ship.
Catherine Ashton is a busy woman. Whilst holding enough titles to rival the Duchess of Alba, she is the EU’s High Representative for Foreign Affairs and Security Policy and therefore responsible for coordinating the Union’s Common Foreign and Security Policy (CFSP). Her appointment in 2009 was controversial – many commentators argued she lacked the relevant experience and profile for such an important and prestigious position. Ashton has faced many challenges this year and I’ve discussed them in this piece which was recently published in The New Federalist.