Independence... in Europe?

Reparations. 

Peter Schrank

It’s a word that would last have been heard in Fourth Year History when the subject of either the end of the First World War or the seeds of the Second World War came up.  Yet this word that has connotations of old Europe – of punishing (harshly) Germany for its role in the First World War.  It sums up the opposite of being magnanimous in victory.  Yet this is a word that cropped up in today’s I newspaper – who quoted a column in the Portuguese newspaper “Publico” – in relation to the Sarkosy/Merkel plan to keep the Euro off the rocks.

The quote in full relates to the Franco German plans to create closer fiscal union - “Germany is preparing to Germanise Europe… Even if we accept that we will have to “reinforce and harmonise” fiscal and budgetary integration in the Eurozone, the Merkozy couple’s demands are reminiscent of war reparations. The defeated and afflicted will have to fulfill more and more requirements, but there is no requirement for effort, money or solidarity to help them.”

Of all the people who should be apprehensive about the proposed treaty, it will be the countries emerging as the “soft” Eurozone countries – countries that according to John Major’s old Bette noir Jacques Delors (in a recent newspaper interview) should not have been admitted to the Euro at inception.  That Greece, Portugal, Ireland & Spain were not thought to be in any economic danger until they were in economic danger seems to have been missed by Economists desperate to re-write history to cover up the fact that they missed this storm coming.  Those countries will be at the centre of any attempts to impose stricter fiscal regulations on Eurozone countries.  These countries have also suffered from a lack of income from holidaymakers – mostly from the UK.  This brings us to the position of our dear leader.

Since becoming Conservative leader in 2005, Cameron has been making Euro-sceptic noises in an attempt to keep his right wingers on side- lest he thought of as a “Tory wet” as those on the left of the Conservative Party were dubbed under Thatch.  This is his first “true” test of how much of a Euro-sceptic he is and there are signs that he is beginning to twist in the wind.  When asked at PMQ’s what his red line issues were, he blustered on about how he would resist any attempts for closer fiscal union – without giving any details.  It would be kind to think that Cameron was keeping his powder dry, he did exude the air of a man with a lot riding on the next 72 hours with all of the uncertainty that brings showing.

The backbench Conservatives see this as an opportunity for a referendum on the subject of Europe.  Thanks to their election pledge to put any further treaties to the public vote, they can see something to beat the European Union with – and also the opportunity to “re-patriate” some powers from Brussels.  This group are already in good spirits – due to the belief that they were right about the Euro – so would love to see an end to what they see as the transfer of powers to Brussels.  The strange thing is that politically and in other areas, the EU is closer to the Conservative viewpoint than they have been for a long time. 

Sarkosy & Merkel are from the French & German equivalents to the Tories, and are more right wing than their predecessors from those parties while we have seen a new right of centre government elected in Spain.  The EU have taken a back seat with the list of terms relating to the Greek bale out – those terms not including reform of their tax system but including wholesale privatisation of various services.  At the heart of drawing up those terms was the pro-Friedmanist IMF and the European Central Bank.  Both of those bodies being close politically to the Conservatives – Pro business, pro Market and pro Lasiz Faire/Light Touch Regulation.  The European believers of Milton Friedman (and indirectly Thatch) are coming into positions of power.  Yet for some people, the thought of giving up power really can be a roadblock to any alliance.

One group who really should be paying attention to the happenings in Brussels is our own government at Holyrood.  Tucked away in page 16 of the Scotland Forward document, which was released last week, is this little snippet “Membership of the European Union is hugely important – not just to us, (heaven forbid!) but to the rest of the EU too.  We own much of it’s oil and gas reserves (What happened to “It’s Scotland’s Oil” then?)…  With independence we will remain part of the EU.” With the EU due to discuss fiscal union, where exactly does that leave the SNP’s aim to control and set low rates of Corporation Tax?  Ireland might have been one of Salmond’s economic role models for an independent Scotland, but even he must have noticed how unpopular their policy of low Corporation Tax was in Brussels, Berlin and other “old European” capitals.

18 months since the election that put Cameron into Number 10, we have probably come to the moments that will make or break Cameron.  The Scorched Earth policy will affect lots of people, but whatever happens regarding the “Merkozy” plan will affect how Cameron’s relationship with his party and his coalition partners.  The Spectator editor Fraser Nelson tweeted that Cameron looked stunned at Labour’s Eurosceptic line of attack at PMQ’s yesterday.  A newly Eurosceptic Labour party wouldn’t just be “lethal” to Cameron’s hopes for a majority come 2015, it would open up a front against the SNP’s pro-Independence campaign.