Did Davey do the right thing?

[ahinton]

The perfect coalition IMV , though once we get the republic this would be the perfect pair to replace the queen

I fear not; after all, whilst the jury might be out on how effective a coalition they might be able to forum and run, neither would wish to replace the queen in any case and I don't think that reluctance in office is going to get any of us far...

[ahinton]

You accept that "EU regulations on the sale of cabbage: 26,911 words" is untrue, though, Mr Pee? One of those urban myth thingies?

On the Tobin Tax this is interesting (yes, I know it's from The Morning Star and not a respectable paper of record like The Daily Mail or The Guardian. Even so ).

http://www.morningstaronline.co.uk/n...ew/full/112809

Thank you for this. I cannot remember ever having read so much good sense in so short a space of time in that journal! The only addition that I might make to it is to place more emphasis on those who would have to fund the "Tobin Tax" were it ever to be introduced - and it would be the like of you and I when it's passed on to us, just as, for example, currency exchange costs are passed on to the customer. I was very pleased to read this.

[Pilchardman]

You accept that "EU regulations on the sale of cabbage: 26,911 words" is untrue, though, Mr Pee? One of those urban myth thingies?

On the Tobin Tax this is interesting (yes, I know it's from The Morning Star and not a respectable paper of record like The Daily Mail or The Guardian. Even so ).

http://www.morningstaronline.co.uk/n...ew/full/112809

Just show that Tankies are occasionally right.

[aeolium]

I agree with vinteuil that the Britain vs The Rest issue is largely irrelevant to the much more serious issues facing the EU and which as far as I can see were not remotely addressed by this summit (though Cameron's reasons for his course of action do seem bizarre).

Specifically, the decisions of the summit (at least of the 26, or the 17+ depending on how many are definitely agreeing to it) do not address the matter of sovereign indebtedness and the huge debts lying within the banking system, the amount of which is still unknown. The Merkozy plan falsely ascribes the problem to government excesses and breaches of the Growth and Stability Pact, and therefore tries to resolve it through a new treaty (which is not an EU treaty and therefore cannot use any of the executive instruments of the EU) to supervise the borrowing of the nations signing up to it. There is no recognition that excessive government borrowing was not at all the main reason for the crisis, which was caused by catastrophic banking activities - the losses from which then had to be underwritten by sovereign countries, tipping them into crisis. Nor is there a recognition that a fundamental problem of the eurozone is the imbalance between the wealthier northern members and the weaker southern ones, with no fiscal transfer mechanism to try to correct this.

The debt crisis will come to a head probably by mid-2012. Eurozone member states are required to repay €1100 billion of debt next year, while a further €665 billion is required to be paid by European banks by June 2012. Where is this money coming from? The recent summit agreed that private bond-holders would not be required to take any further losses, so the hit falls entirely on European taxpayers, probably through a continuation of savage austerity measures, asset sales and perhaps limited printing of money by the ECB. The austerity will create a downward spiral of recession, or very low growth, as well as social unrest, and yet it's still hard to see it staving off disaster. Look forward to another summit "with 10 days to save the euro" next year.

Still, if the worst happens, Merkozy will be able to go to the electorates and blame it all on Britain's lack of co-operation.

[Lateralthinking1]

The Britain vs The Rest issue may be largely irrelevant economically to the much more serious issues facing the EU. It isn't in terms of democracy. One might instinctively feel that the financial bleakness is the bottom line; that nothing else counts in efforts to maximise the chances of stability. Actually, democracy is on a line below it.

As sections of populations take to tents on the streets because of economic mismanagement, what then? Revolution or a vote in the ballot box? My understanding is that the diktat from Merkel and Sarkozy severely limits alternative policy approaches, thereby rendering national elections less effectively democratic. This by definition will make the tinderbox look to many like the only "solution". In Britain, this doesn't apply. For now, we still have our democracy of sorts intact.

I agree that the Merkozy plan chooses the wrong cause. Yes it was the bankers. I'm not sure though that I agree with Grant's comments on the Single Market. Certainly, Clegg has given every indication in public that he believes we can fight our corner there and that this is important. Of course, he twists and turns so it is difficult to be sure. But perhaps the one thing in his favour is that he knows the institutions inside out, having been a Eurocrat.

I am still not hearing from forum members what tremendous influence Cameron would have had if he had played it differently. A slower, considered, withdrawal might have helped to keep a few friends, if not Sarkozy, but what if he had signed up to the Treaty? What specifically then would Cameron - not Miliband, not Owen, not Heseltine, not Clegg - have done with his "influence" in the interests of us? As far as I am concerned, nowt, but I'm happy to be persuaded otherwise by concrete facts.

[scottycelt]

Britain is the second largest economy in Europe and the leading European member of Nato, and should surely at least be at the table when the future of Europe is being discussed. Our influence has only been diminished because we have chosen it to be so.

Even Thatcher never used the veto. If Cameron had worked constructively with our European partners, instead of constantly carping at them and behaving like a spoilt child, a deal could have been done for the benefit of all.

Clegg said it all on TV this morning. We should be helping to lead Europe not hiding away in a corner while others decide our future.

Nothing much seems to have really changed in insular British attitudes since Messina, 1955.

[John Skelton]

I agree with vinteuil that the Britain vs The Rest issue is largely irrelevant to the much more serious issues facing the EU and which as far as I can see were not remotely addressed by this summit (though Cameron's reasons for his course of action do seem bizarre).

Specifically, the decisions of the summit (at least of the 26, or the 17+ depending on how many are definitely agreeing to it) do not address the matter of sovereign indebtedness and the huge debts lying within the banking system, the amount of which is still unknown. The Merkozy plan falsely ascribes the problem to government excesses and breaches of the Growth and Stability Pact, and therefore tries to resolve it through a new treaty (which is not an EU treaty and therefore cannot use any of the executive instruments of the EU) to supervise the borrowing of the nations signing up to it. There is no recognition that excessive government borrowing was not at all the main reason for the crisis, which was caused by catastrophic banking activities - the losses from which then had to be underwritten by sovereign countries, tipping them into crisis. Nor is their a recognition that a fundamental problem of the eurozone is the imbalance between the wealthier northern members and the weaker southern ones, with no fiscal transfer mechanism to try to correct this.

The debt crisis will come to a head probably by mid-2012. Eurozone member states are required to repay €1100 billion of debt next year, while a further €665 billion is required to be paid by European banks by June 2012. Where is this money coming from? The recent summit agreed that private bond-holders would not be required to take any further losses, so the hit falls entirely on European taxpayers, probably through a continuation of savage austerity measures, asset sales and perhaps limited printing of money by the ECB. The austerity will create a downward spiral of recession, or very low growth, as well as social unrest, and yet it's still hard to see it staving off disaster. Look forward to another summit "with 10 days to save the euro" next year.

Still, if the worst happens, Merkozy will be able to go to the electorates and blame it all on Britain's lack of co-operation.

Thanks aeolium for putting that so clearly. Again, I find the response of so many who would broadly see themselves as on the political Left to the decisions of the summit quite bizarre. Their only interest seems to be what Cameron did and restating a distaste for the Little Englander attitude. Nothing else seems to register. People who will march against austerity measures here express no qualms about the legalistic imposition of austerity required by the summit. In some ways this is a neoliberal coup in Europe. Owen Jones writes:

as Paul Mason has written, "by enshrining in national and international law the need for balanced budgets and near-zero structural deficits, the eurozone has outlawed expansionary fiscal policy" .... Left-wing governments of all hues will, in effect, be banned by this treaty. If the French or the German left returns to power in the near future (and both are in a good position to do so), it will be illegal for them to respond to the global economic catastrophe with anything but austerity. An economic stimulus is forbidden – because the treaty has buried Keynesianism.

http://www.newstatesman.com/blogs/the-staggers/2011/12/european-treaty-cameron-stop

[aeolium]

"An economic stimulus is forbidden – because the treaty has buried Keynesianism."

I agree with this analysis, JS, and I would add that this is but a logical extension of the rules enshrined in Maastricht - that is where the grave was dug.

An interesting question is what happens under this treaty to a eurozone country where there is a significant bank failure which requires a bail-out by the government of that country - yet the bail-out causes the country to break the terms of the treaty (i.e. forces its borrowing to exceed 3%), so that it automatically incurs penalties. This is of course by no means an unlikely situation - a major French bank was thought to be on the brink only last week.

[johnb]

Thanks aeolium for putting that so clearly. Again, I find the response of so many who would broadly see themselves as on the political Left to the decisions of the summit quite bizarre. Their only interest seems to be what Cameron did and restating a distaste for the Little Englander attitude. Nothing else seems to register. People who will march against austerity measures here express no qualms about the legalistic imposition of austerity required by the summit.

I agree that the decisions taken by the 17+ are largely displacement activity which do little to address the fundamental issues.

However, don't forget that Cameron had absolutely nothing to say about that aspect of the treaty proposal. Nothing what-so-ever. His stance was that he would sign up if his demands were met - and those demands solely concerned the protection of the UK's financial services industry so that he could use the argument that he had stood up for British interests to avoid a referendum being forced upon him.

Of course, the result was that Cameron got absolutely nothing and left Brussels with the UK's financial services sector even more at risk from decisions made by the 26, with the UK having to accept any regulatory decisions without being able to influence them and without having any friends or allies.

Not only that, by alienating so many natural allies his actions will make it harder to pursue the UKs interests in other areas within the UK because the EU negotiations depend on building support with other nations.

So much for safeguarding British interests.

That is why I believe this is the worst diplomatic failure for at least a generation.

[aka Calum Da Jazbo]

i find this difficult because a i do not agree with Dave and what he has done and b i do not agree with Merkozy and the end of Keynsianism and the abject failure to deal with a practical crisis .... no one believes in the euro enough to lend money at affordable interest rates and no one has any idea how to reconcile the economies of the eurozone excerpt for the rerunning of 1930s and IMF World Bank stupidities .... so there was nothing on offer worth signing up to ..... but why VETO? abstention and disagreement are possible without such melodrama surely ... and this is where the little england goon squad come in to the reckoning, it was a tactic by for and of them .... and as such repulsive ....

i read a comment by a fund manager that the city makes shedloads of money for the UK and should be protected .... funny i thought it cost us shedloads of money to keep solvent ... er if you have it could we have it back please? ....

the summit itself was criminally irrelevant to the realities of Europe and its economies .... but Dave made a most unnecessary grandstanding stunt .... which appears to have the overwhelming support of the Mail readership ...

[amateur51]

but why VETO? abstention and disagreement are possible without such melodrama surely ... and this is where the little england goon squad come in to the reckoning, it was a tactic by for and of them .... and as such repulsive ....

i read a comment by a fund manager that the city makes shedloads of money for the UK and should be protected .... funny i thought it cost us shedloads of money to keep solvent ... er if you have it could we have it back please? ....

the summit itself was criminally irrelevant to the realities of Europe and its economies .... but Dave made a most unnecessary grandstanding stunt .... which appears to have the overwhelming support of the Mail readership ...

Nicely put, Calum!

[Serial_Apologist]

As an aside, I'm not so sure about the Morning Tsar's qualms about a Tobin tax, which - apart from the complications of currency speculation I didn't understand - seem to be based on its introduction de-incentivising speculation and therefore raising little of the tax. Surely then this would have achieved its desired end twofold: by at least reducing speculation; and by only requiring a small tax subdivision for dealing with.

Haig was on the News at One claiming that Mercozy will be in no position to form any sort of inner sanctum of Leading light UE countries without breaking EU laws and treaties, and thus being subjectable to action through the EC. Remains to be seen, I guess...

[Biffo]

Not nicely put. If Cameron had abstained (even assuming abstention was possible) the the new Treaty would have been binding on us. That is exactly what he didn't want.

Read John Skelton above. Is that what all Cameron's critics want and are they really prepared to accept it just so that we are not 'isolated'. I have watched Lord Oakeshott waffling twice now on television and that seems to be the Liberal Democrat position. As I said before, when it comes to the crunch probably not all 26 will sign up to the accord and certainly not all 26 will take much notice of it even if they do.

Do the critics reall want our budget to be submitted to the European Commission for scrutiny and sent back if they don't like it?

The other recurrent theme is that Cameron should have negotiated. Negotiated what? The so-called 'accord' was cooked up by Merkel and Sarkozy and presented on take-it-or-leave-it basis.

[BBMmk2]

I am not too sure wether the Fiscal Union of Europe would actually work? The geography in itself, would make this far too compklicated an issue for it to work.

[John Skelton]

As an aside, I'm not so sure about the Morning Tsar's qualms about a Tobin tax, which - apart from the complications of currency speculation I didn't understand - seem to be based on its introduction de-incentivising speculation and therefore raising little of the tax. Surely then this would have achieved its desired end twofold: by at least reducing speculation; and by only requiring a small tax subdivision for dealing with.

I think Jerry Jones' point is that campaigners for a "Robin Hood Tax" present it as something which will raise significant revenue. Not as a tax which will de-incentivise speculation. His argument is that the former won't happen, so the premise is false. In other words, it isn't the solution to revenue 'shortfall' campaigners claim.