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Tuesday, June 19, 2012

Britain and the eurozone: players not spectators | Editorial

The latest volume of Alastair Campbell's diaries are another reminder of how Europe has dominated and divided British governments for decades

The latest volume of Alastair Campbell's diaries are another reminder of how Europe has dominated and divided British governments for decades. The issue at the heart of Mr Campbell's latest volume was Tony Blair's determination to keep UK eurozone membership open and Gordon Brown's equal and opposite resolve to bolt the door. Go back a decade or so, and the divisive issue would have been the Maastricht treaty. A decade before that, the European exchange rate mechanism. Before that, membership of the European community itself, in or out, would have been the battleground around the cabinet table and between and within the political parties themselves.

And now? Europe undoubtedly still dominates the national agenda. David Cameron had barely touched down in Mexico for the G20 summit yesterday before he was issuing statements about what Greece and the eurozone nations should be doing. Yet it was said more as an observer than as a participant. Publicly at least, it is taken for granted that Britain is well off out of the eurozone. The only questions that appear to matter to the political class of both right and left are, first, whether the British economy can ignore the continent's turbulence and, second, what partisan advantage can be extracted from a seemingly inevitable EU referendum.

Yet the belief that Britain is blessed by being on high and secure ground from which we can watch as the European project is washed away, and then calmly turn our backs on it without damaging this country, is a misleading one. The real question is not whether Britain has an interest at stake in the eurozone crisis or the future of the EU, but how those real interests can be best defended and promoted. Ministers know this but prefer to play to the gallery. Mr Cameron also knows there is no economic firewall protecting Britain. George Osborne warned in his Mansion House speech last week that eurozone collapse would have dire consequences for Britain. British ministers are willy-nilly players in these events, as they always have been.

At the weekend, Mr Blair told the BBC it was critical for Britain to use its influence to shape the outcome. Characteristically, he talked in terms of a grand negotiation to produce a solution based both on growth and structural reforms to which all could sign up. It is easy to dismiss such talk. Yet it is a better and more realistic strategy than Mr Cameron's ineffectual and disingenuous warnings from the grandstand. Engagement is the strategy which John Major would have followed, not just Mr Blair or Mr Brown. Mr Cameron needs to stop the sermons this week and get much more actively engaged with forging more effective solutions.


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