Europe

“It’s a Very Bad Thing When Economists Start to be Interesting”

Yes it is. Despite what the Irish government says, it's now surely a matter of when Ireland has a bailout forced upon it. We left "if" behind some time ago. Even the non-denial denials are specific enough to be revealing. As Shane Ross put it on Sunday, "The game is up."  Perhaps it won't happen today and pehaps it won't be tomorrow but it will happen soon. And the worst of it is that it's not really about Ireland at all. The history of the Greek and Irish experiences (for all their differences) suggests that saving one patient merely endangers the next sickly country in the waiting room. None of the doctors seem well-qualified though perhaps none of the patients can be saved anyway.

The world is now in China’s hand

The world is undergoing a permanent shift of power from West to East, with China being the biggest beneficiary and middling states (like Britain) likely to be the biggest losers. The government may, in the words of William Hague, reject any kind of strategic shrinkage. But if China's economy continues to grow at even half the rate it has developed until now, Britain will end up looking small no matter what policy it pursues. What is the best way to deal with a country like China, which on current projections, will have a larger economy than the United States by 2050? How best to position Britain if the US and China abandon peaceful co-existence, and, as the FT's globe-trotter Gideon Rahman predicts in his new book Zero-Sum World, begin to fight?

What happened to Germany’s European identity?

What has happened to Germany? Policy-makers and analysts have been pondering the question for the last few years. No longer happy to be the pro-European par excellence, Germany has become more assertive, more self-centred - in others words more normal. German scholar Ulrike Guerot has called the new Germany "post-Romantic", ie more interest-based and less willing to let its history determine its future. Dominic Moisi says Germany has become "a second France." Part of the reason is the change among the country's political elite. The post-war generation has left the scene and the new leaders - on the Left and Right - have little time for Helmut Kohl's cheque-book diplomacy.

Is Euro-pragmatism here to stay?

I'm off to Brussels, capital of the superstate, home of the EUSSR, or whatever you might want to call it. It has made me re-engage with European issues for the first time in six months. If Europe is not dead as a political issue in Britain then it is at least firmly stored in a coalition freezer, which can only be unlocked in the case of a thumping electoral for the Conservatives. But if the Tories scrape in at the next election or come up short of an outright majority,  David Cameron is likely to want the Coalition to continue. That would mean another decade of euro-pragmatism. A decade is a very long time in politics.

In defence of UK-French defence cooperation

The Entente Cordial Redux has generated a lot of commentary, most of it ill-informed, some of it ridiculous. Tory MP Bernard Jenkin, in particular, has singled himself out to be a perpetuator of stereotypes with his reference to the duplicitous nature of the French. But many historians, like the otherwise brilliant Orlando Figes, have not fared much better, talking about the Crimea War as if it had any relevance at all for modern warfare. It’s good fun to tease the French. That is what boozy lunches ought to be about. But it should not pass for serious commentary by MPs. Since the 1990s the French have worked very closely with UK forces, even when disagreements at the political level have been profound.

Europe hasn’t gone away

The Tory party’s acceptance of a 2.9 percent increase in the EU budget has persuaded Steve Richards that ‘Europe has ceased to be a toxic issue in British politics.’ As Steve acknowledges, this is in part because the Euro-sceptics have won the argument over the single currency. But it is also because the Tory parliamentary party has accepted that the coalition means nothing positive is happening on the Europe front for the next few years. One thing, though, needs to be borne in mind: the Tory party is more Euro-sceptic than it has been in living memory.

Prisoner voting rights are undemocratic

It was unlikely that the Coalition could have played for any more time before lifting the ban on prisoner voting.  That was the tactic played by the previous Government, but now it seems the will of Strasbourg will prevail.  But the policy is wildly out of step with public opinion, hard to justify and difficult to administer – it is also another example of how our own Parliament and domestic courts have been undermined.     The public are opposed – usually on principle – to granting additional privileges to serving prisoners, especially when they have done little or nothing to earn it.  They are against voting rights in particular on the grounds that it is one of the rights that lawbreakers give up by virtue of their crime.

Entente très cordiale

When it comes to pomp, Britain and France are still superpowers. The entente très cordiale has brought out all the plumage of 400 years of professional soldiering - bearskins, ostrich feathers, mink, gold leaf, thorough-bred horses, billowing capes and vibrant shades of scarlet and blue. Waterloo must have been a hell of a fashion show, before the guns inaugurated spectacle of a different kind.    As Liam Fox explained on the Today programme, this agreement enables two ailing but still ambitious powers to project force overseas beyond their specific territorial interests.

A wasted opportunity for EU reform?

David Cameron made his statement on last week’s EU summit yesterday, answering a range of questions on the 2011 EU budget increase and future changes to the EU treaties. The Tory backbenchers appeared to be on their best behaviour, but Cameron did make an interesting admission. Asked by Ed Miliband if he would he be repatriating powers, he pointed to a reassurance that the UK’s opt out from economic sanctions remained intact, which was not really in question in the first place, and spoke of “progress on the EU budget”. It slipped through virtually unnoticed, but this second remark is actually quite worrying.

The inviolable right of prisoners

After 6 years of resistance, the British government has submitted to the European Court of Human Right’s judgement that prisoners have the right to vote. It will use a case in the Court of Appeal to make the announcement and then prepare itself for compensation suits. Understandably, the government is furious that it has been forced to make a concession on law and order, an area where they are weak enough already. Even Dominic Grieve, a firm supporter of the ECHR, is understood to be exasperated. Straining to limit the political damage, Ken Clark hopes to limit the franchise to those prisoners sentenced to less than four years; judges may also be able to decide who to exclude.

Cameron emerges unscathed

David Cameron’s statement on the European summit just now was an opportunity for pro-European politicians to tweak the Conservative party’s tail about the coalition’s stance on Europe. Ed Miliband told the PM that on Europe ‘we’re here to help him’ and ‘we’re prepared to ignore his previous convictions if he is too.’ Charles Kennedy welcomed the PM as a new pro-European. While Denis MacShane, the very communitaire former Europe Minister, said that there was nothing in Cameron’s statement he disagreed with. There was some grumbling from the Tory benches. Sir Peter Tapsell asked why if Merkel can get a Treaty amended can’t Cameron do the same and allow the country the referendum it was promised.

Cameron’s euro battle is just beginning

David Cameron sold himself a hospital pass in Europe this week. His failure to secure a budget freeze has revealed that Britain's clout has been wildly exaggerated. The likely 2.9 percent budget increase is mildly inconvenient for Cameron politically, but it is immaterial in the grand scheme of the next round of budget discussions and the mounting wrangle about the Lisbon treaty. He will have to compromise, as he did this week. He made some ground, finding allies to resist an untrammelled treaty change - the Irish, the Dutch, the Danes, the Czechs and the Poles. The biggest prize will be Sarkozy, whose antipathy towards Merkel is arch - the ongoing diplomatic and military discussions between Britain and France must be about more than sharing aircraftless carriers.

Victory or defeat?

What has David Cameron achieved in Brussels so far? In truth, it's fairly hard to tell. In a meeting with his European Council counterparts last night, our prime minister didn't get the "freeze or a cut [in the EU budget]" that he mentioned last weekend. But ten other countries, including France and Germany, have now allegedly hardened their resolve not to go beyond the 2.9 percent increase that they agreed back in August. A Downing Street spokesman explains that these countries will resist the usual compromise between their 2.9 percent and the European Parliament's demand for 6 percent, when the two sides meet over the next 21 days.

Question: how much do we contribute towards the EU budget?

Answer: it depends on how you look at it. I've put together the chart below (click for a larger version), which sets how much money we've given the the EU since 1973. There are three lines for each year: i) our gross contribution, ii) our total contribution (which is the gross contribution minus the money we get back from the rebate), and iii) the net contribution (gross contribution minus both the rebate and the money that the Treasury gets to pay for various EU projects across the UK). In terms of how much the EU costs the taxpayer, then, I'd say the second line is the best one to follow:   As for the future, there are no comparable figures yet (as the Treasury works in financial years, whereas the EU works in calendar years).

Labour’s hypocrisy on the EU budget

Labour’s Shadow Europe Minister, Wayne David, has been busy castigating David Cameron for his apparent failure to secure an EU Budget freeze. He says, ‘It is imperative that we do have a freeze on the EU budget’. Quite so, why then did Labour MEPs vote against an amendement to freeze it?

Cameron must play his cards well to win in Europe

The British media woke up this week, realising that Europe still exists. As David Cameron travels to Brussels, questions loom over what, exactly, he can achieve in Europe – at this summit, and more importantly, moving forward.   Much of the commentary surrounding the summit has focussed on the increase to the EU’s 2011 budget, which Cameron is fighting.  And for good reason. It’s insane that Britain – or any other net contributing state – should be forced to accept any increase to the EU budget, at a time of tough austerity at home.   Cameron has spent considerable time talking up the negotiations on the budget increase, so he may have an ace up his sleeve to achieve a cash freeze tomorrow or in the coming weeks. But a 2.

Cameron takes on Europe

European leaders, we are told, have been charmed by David Cameron since he formed the coalition government – today, we must hope that he can use that charm to good effect. The Prime Minister heads to the EU Summit in Brussels later, following an evening of earnest phone conversations with his French and German counterparts. His plea was simple: reject a planned 6 percent rise in the EU budget  for next year. But the outcome is hazy. While our government wants the budget to be frozen in 2011, the likelihood is that it will alight somewhere between the 2.9 percent sought by the European Council and the 6 percent agreed by the European Parliament.

Eat your heart out, Fukuyama

Russia and Nato are now allies, or birds of a feather at least. The Independent reports that the twentieth century’s opposed spheres will work together for stability in Afghanistan. The attendant irony is blissful. Two years ago, machismo raged between Nato and Russia over Georgia. Why the sudden accord? There are two schools of thought, both relating to the East’s inexorable rise. Russia can no longer determine Central Asia of its own accord: China co-opted the Shanghai Cooperation Organization, a long-time pillar of Russian power in Asia, to condemn Russia’s recognition of South Ossetia and Abkhazia - a sign, to Russian eyes at least, of China's creeping influence in Central Asian politics.

Weak, weak, weak

Weak again. For the second session in a row Miliband was feeble at PMQs. He opened in his quiet-assassin mode with a quickie question. ‘There are reports that the government is planning changes to housing benefit reforms. Are they?’ Clearly he meant to wrong-foot Cameron by tempting him into admission which could be instantly disproved. But Cameron simply denied the suggestion and Miliband had no embarrassing disclosure to fire back with. Pretty duff tactics there. He fared slightly better when he asked Cameron what advice he’d give to a family facing a 10 percent cut in housing benefit after the chief bread-winner had been unemployed for a year. Cameron replied that unlimited benefits ‘are a serious disincentive to work.