Wednesday, April 21, 2010


From 'A Thousand Years of History: Britain in Europe 1066-2066', Oxford University Press, 2070.

Britain's 'national government' of 2010 was not unprecedented. Britons had accepted patriotic coalitions before during the First Great Recession and Second World War. Still, David Cameron's Conservatives fought hard in the aftermath of that year’s general election to preserve a minority government propped up by an unlikely assortment of regional parties and independents. But industrial unrest and a stuttering economic recovery ate away at investor confidence in Britain’s public finances. With pressure on sterling mounting, Cameron was finally forced to invite Liberal leader, Nick Clegg, into a national coalition.

Buoyed by a huge increase in the Liberal vote, Clegg at first opted for opposition. He bet that a swift second election was likely and that the Liberal Democrats would again double their seats. But the threat of a new financial crisis later that year spelt an end to normal politics. And Cameron's offer to give Vince Cable – the Liberals' ever popular shadow chancellor – the role of deputy at the treasury to help fight Britain's "economic blitz" could not be refused.

Clegg himself took on the post of foreign secretary, setting the scene for the coalition's first crisis: Britain's European policy. Despite howls of protest from the Conservative grass roots, Cameron agreed to "put on hold" Tory demands for a membership renegotiation that would have withdrawn Britain from EU policies on social policy, human rights and justice and policing. Instead, Britain pursued its interests in Europe based on a joint strategy called 'Leading critically: A new pro-Europeanism', swiftly dubbed "Clameronism" by The Economist.

For a time, the odd fusion of Cameron's detached euroscepticism and Clegg's pro-European stance worked well. Though he had to cope with a handful of defections from his own party, Cameron no longer had to fret about how he might extract himself from his pre-election promises on the EU when they proved undeliverable. Nor did he have to endure the ignominy of blocking Croatia's EU accession with demands for special concessions for the UK. And Clegg's ability to woo the European Parliament – where the Alliance of European Liberals held the balance of power – proved critical in protecting Britain from overly onerous financial regulation and restrictive laws on working hours. The Conservatives, meanwhile, could afford occasional gestures to stubbornly high eurosceptic sentiment at home.

In 2012, a British-French initiative set up St-Malo II, an EU defence avant-garde needed to cope with plummeting defence budgets. Later, President Strauss-Kahn supported the European Commission's drive to complete a functioning EU services market by 2017 in return for basic rules on corporate taxation. Ever closer Anglo-French partnership contrasted sharply with what became known as Germany's 'strategic lethargy', where Berlin glumly viewed continued European integration as a negative but lacked the will to take alternative initiatives.

It was ironic, then, that events in Germany were to trigger the unravelling of the Tory-Liberal consensus and the end of what many considered to be their unholy alliance. In the so-called 'Four Professors' crisis of 2013, a brittle hodgepodge of bailout guarantees needed to keep Greece and other countries in the euro were struck down as unconstitutional by the Bundesverfassungsgericht on a third attempt by a group of German academic economists. A mushrooming series of financial and political crises finally forced EU leaders to confront the question of European Economic Union (EEU) at a hastily convened Inter-Governmental Conference in early 2014.

The so-called Treaty of Prague – which established a centrally managed eurozone treasury fund equal to 3 per cent of EU GDP – irrevocably split the coalition. A major change to the EU's treaties with implications for its budget, the treaty still required ratification in Britain. Cameron was unable to contain a backbench revolt in his own party over what were perceived as overly weak safeguards secured on Britain’s ‘red lines’ by the foreign secretary. For his part, Clegg insisted on a protocol which would leave open the option that Britain might one day join the euro.

Both parties had previously committed to holding a referendum on Britain's future in Europe and now that too became unavoidable. The Liberals, campaigning with Gladstonian fervour, insisted that a vote on the Prague treaty was vital for EU stability and must be considered the same as a vote on Britain's continued membership. The Tories countered that a rejection would merely halt the establishment of a European super-state on the brink of becoming financially independent of the member-states. The bitterly fought referendum, held alongside a general election in May 2014, marked a decisive shift in Britain's relationship with ‘Europe’, especially given the scale of the resulting landslide…

Hugo Brady is a senior research fellow at the Centre for European Reform.


Julien Frisch said...

It is very unlikely that anything coming out of an intergovernmental conference in 2014 will be called "The Treaty of Prague" because the Czechs won't have an EU Council presidency for the next 13 years... :-)

Unknown said...

Is the book available for pre-order?

french derek said...

Brilliant! Some of your prognostications could be on my wish-list. Though not a UK voter, the idea of the "coalition" sounds interesting. President Strauss-Kahn is certainly on my list (the only safe socialist in France - even though he's currently very engaged in NY).
Not sure the idea of full economic union would come about on your time-scale (whatever the pressures).

But stranger things have happened at the EU.