Cameron And Merkel: Did She Yield?

No. She was polite and engaging. She acknowledged there were problems. She wanted Britain to stay. But on the free movement of people she would give no quarter. Neither did she see the prospect of treaty change. She declared Britain and Germany shared the same values and with a smile, a kiss and a wave she left. Cameron was jovial. And brave. But he got nothing he did not already have.

Unfortunately the avuncular and genial Cameron, good at articulating the public mood, is badly advised on foreign policy and flat footed when undertaking it. He makes a mistake forcefully declaring Britain’s demands. Instead he should concentrate on Euroland’s needs. Now deflated and with a Greek crisis once again simmering and the ECB poised to print money, it is becoming as plain as a pikestaff that greater federalism in the Eurozone is an ever more urgent priority. At the heart of the issue is the fact that the Eurozone has a Central Bank but no Treasury. For that it needs a government and sooner or later it either has to get one or fold up. The only alternative is to accept that Germany is both the Treasury and the Government. In other words Germany is not part of Euroland, but Euroland is part of Germany.

This is where the opportunity lies for Britain to cut a deal which all but the nutters will vote for in a referendum. As the Eurozone becomes Federalized, led by Germany, those outside the Euro become attached but not linked, led by Britain. A two speed Europe yes. But better than a stopped dead Europe, which is what there is now.

And everyone has to stop being silly about Russia.

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