Sarkozy attacks Cameron – much to Cameron’s delight

While European leaders are struggling to put together a rescue package for Greece which will not have a domino effect for Italy and Spain or drown too many European banks, David Cameron is facing renewed opposition to membership in the EU from within his own party. But it is not only in the UK that opposition to the growing exercise of powers by Brussels is increasing. Almost every EU member which has not adopted the Euro (Sweden, Denmark, Norway and the UK along with some of the newer members) has rising voices calling for the limitation of European power and a return of powers to the country parliaments. Voices against the Euro can even be heard in Germany where there is a widespread feeling ( not entirely wrong) that German taxpayers are paying twice for the spendthrift ways of Southern Europe; first directly by subsiding these countries and secondly by the devaluation of their savings in Euro. The Swiss are just thankful that they were never a part of this experiment.

In hindsight, what has become obvious is that the Euro-zone has few built in sanctions to prevent the profligacy of some countries which has to be paid for by others. What is also becoming clear is that without a fiscal uniformity – which would seem like being taxed from Brussels – the possibility of  “bad” members being spendthrift will always remain.

France has always seen the Euro as part of a long-term move towards a European political and fiscal uniformity in which France would be the centre of political power. A return to the glory days of the Holy Roman Empire which lasted over 800 years, except of course that the centre would be in France rather than in what today is Germany. Sarkozy could certainly see himself as the first Emperor.

Yesterday, as the Telegraph reports:

David Cameron clashed repeatedly with Nicolas Sarkozy today after the French President tried to exclude Britain and non-eurozone countries from a critical Brussels summit to rescue European banks. … 

.. during a meeting of all 27 EU leaders before a crisis summit of the eurozone’s 17 members on Wednesday, President Sarkozy fought hard to get the (UK) Prime Minister barred from talks that would finalise a 100billion euros cash injection into banks. ”We’re sick of you criticising us and telling us what to do. You say you hate the euro, you didn’t want to join and now you want to interfere in our meetings,” the French leader told Mr Cameron, according to diplomats. ….. 

Following strong and vocal support from Sweden and Poland, Mr Cameron secured agreement that he and non-euro countries would be invited to the bank rescue summit next week …… He also won a fight to include a “safeguard clause” that the eurozone would not be allowed to take any decisions on issues, such as regulation of financial services, that affected all the EU’s 27 members.

”I have secured a commitment today that we must safeguard the interests of countries that want to stay outside the euro, particularly with respect to the integrity of the single market for all 27 members.

The attack from Sarkozy could not have come at a better time for Cameron as he tries to face down a rebellion from within his own party’s anti-Europe wing. The Telegraph again:

Britain will seek to claw back powers from Brussels during negotiations for a new rescue deal for the euro, David Cameron said as he attempted to undermine a Conservative rebellion over calls for an EU referendum.

The Prime Minister is to demand more British control over employment and social laws in return for supporting a new European treaty to shore up the single currency. ….  Mr Cameron’s “repatriation of powers” offer came as the Conservative leadership was making a last-ditch attempt to stop at least 60 Tory MPs voting for a referendum on leaving the European Union in the Commons today. ….

European leaders are negotiating a multifaceted deal which is expected to see Greece go bankrupt and write off more than half its debts. Banks across the continent will also be lent about €100 billion (£87 billion) to boost their balance sheets, so that the impact of the Greek meltdown will not lead to another banking crisis. ….

In return for the large rescue package, the German government is likely to insist on new legally-binding rules that would stop euro countries from borrowing beyond their means in future. Creating these rules would require a rewriting of EU treaties that would need to be endorsed by all countries.

The relationship between members of the single currency and those, such as Britain, outside the arrangement was the subject of heated discussion at the weekend. Nicolas Sarkozy, the French President, pushed for greater euro-area integration but Mr Cameron is wary about decisions affecting Britain being taken without this country’s approval.

But a repatriation of some of the powers ceded to Brussels back to member countries along with a sharpening of the sanctions against irresponsible government could well be a healthy step and a way forward.

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