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Friday, November 23, 2012

Yet again, EU leaders fail to agree

Another summit collapses, with Herman Van Rompuy and José Manuel Barroso the biggest losers

The collapse of another EU summit, unusually quickly within less than 24 hours, marks a month of serial failure for Europe's leaders.

Another summit in another three weeks already has diplomats, officials, and onlookers groaning in anticipation. Can this lot ever agree on anything?

As well as barely even beginning to negotiate a €1trn, seven-year budget on Thursday night and Friday, they also failed to settle the Greek debt crisis, and declined to agree the terms of another bailout, this time for Cyprus.

By Friday afternoon they could not even agree on whether to continue talking or whether to call the whole thing off and come back after Christmas. The Poles said the talks would go on late into the night and into the weekend. The Dutch said there was no point.

Angela Merkel, the key mediator, appeared not to relish the prospect of a marathon session doomed to failure. Before abandoning the effort, she rescued David Cameron from isolation – not because she was backing Britain but because she identified the German interest in trying to hold Europe together and in avoiding a much messier outcome.

Despite the failure and the signals sent of an EU at war with itself, there were winners. Cameron was accused of demagogy in his anti-European rhetoric and he directed plenty of cheap shots at Brussels, overpaid and underworked eurocrats, and rival leaders allegedly seeking to paint him into a corner.

But the British prime minister oozed schadenfreude with the result, received strong support from the Germans, the Dutch and the Scandinavians and looked pleased with the stalemate, portraying himself as the scourge of bloated Brussels, the guardian of the British and the European taxpayer.

The two big leaders, Merkel and François Hollande of France, on opposite sides of the cuts-versus-spending split, were also victors. Neither in Paris nor Berlin is the EU budget the toxic issue that it is for Cameron at Westminster. They both emerged as winners because they can live with the delay, with the French in particular in no rush to fix a budget for a period that is 14 months away.

The big losers were the organisers of the summit, Herman Van Rompuy, the European council president, and José Manuel Barroso, head of the European commission, accused of presiding over a disorganised, shambolic meeting that barely got off the ground.

These budget sessions are traditionally the most difficult and bad-tempered in what has become a non-stop season of EU summitry – the last summit was last month, the next one is next month. In 2005, the last time they tried to fix spending for the seven-year period, it took two attempts six months apart before Tony Blair conceded elements of the British rebate, opening the way to a settlement brokered by Merkel in one of her first acts as German chancellor.

Given that background, there is little surprise in the deadlock. But the context – three years of euro crisis and the tensions and resentment generated by austerity – is much more negative than seven years ago.

And if there was an air of austerity at the cold cuts supper on Thursday evening, it was back to the old routine at lunch on Friday as the leaders quaffed some 20-year-old Grand Cru Chateau Angelus, retailing at around €150 a bottle.


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