How Europe really works


By TimLuckhurst - Posted on 09 November 2011

Larry Elliot, economics editor of The Guardian, has penned a fascinating column identifying the members of the cabal he claims is now running the EU. With the exceptions of Angela Merkel and Nicolas Sarkozy, none of them has an electoral mandate. They are technocrats, not politicians.  "What matters to this group," writes Elliot "is what the financial markets think, not what voters might want." Intriguing angst from a senior and respected figure at a newspaper that has long been seen as pro-EU.

David Cameron and Britain have become something of a joke amongst MEPs in Brussels these days, especially since the debate on Europe in the House of Commons - how can a Prime Minister not keep his party in check over such an important issue, how is he both in favour of the EU and also entertaining extreme eurosceptics within his own party?

President of the European Commission, José Manuel Barroso, wrote an open letter to the UK in last Sunday's Observer in which he criticised the recent spate of articles claiming Europe is being run by unelected officials: 

  http://www.guardian.co.uk/business/2011/nov/13/jose-manuel-barroso-speed-of-european-union

He also directly calls upon the UK to work more closely with the EU, calling for deeper integration to resolve the Euro crisis...something which David Cameron went directly against in his speech to the City on Monday night:

http://www.bbc.co.uk/news/uk-politics-15730084

Now, Angela Merkl's party is openly saying they're willing to alter Germany's constitution to make a more federal EU possible. The EU's Financial Transaction Tax (FTT), what Osborne calls a bullet aimed at the heart of the City, is suddenly being fast-tracked after Standard and Poors 'accidentally downgraded' France's credit-rating last week (before upgrading it again), sending markets into for a panic for the short time it was down.

Yes, the City is in the UK argues the EU - but its effects are felt throughout the whole of the EU. The rampant banking regulations (or lack thereof) that allowed it to flourish in the first place are the very reasons the banking crisis has got so out of hand.

The gaunlet is about to be thrown down: will Britain be part of a closer EU or will it stand down and leave the EU? It's time for Mr Cameron to come off the fence.

Keep your dangerously unregulated City and lose your EU trade: it's going to be as simple as that in the end. Most people would say leaving the EU isn't a viable option when 50% of trade and 80% of City debt is in the Eurozone.

So the UK government will almost certainly end up biting the bullet and accepting the FTT for what it is - necessary. And with it will probably come a recognition that closer economic unity is impossible without closer political unity...but we'll see. Things are speeding up and the debate is about to thrown wide open.