Single currency doubts play into hands of UK’s embattled government

Date: 08/02/1996

IF you listen very carefully, you might just hear a smug chorus of “we told you so” from deep within the British corridors of power in Whitehall.

Sotto voce, of course, because no one, least of all UK Prime Minister John Major, wants to be caught gloating at the plight of Europe's key statesmen over the decline and, possibly, fall of the great single currency project.

Whatever the personal passions and viewpoints of members of the British cabinet over Europe, the economic disarray now plaguing the ten-year-old single currency project is a source of collective political satisfaction for a government whose fortunes hinge, as ever these days in British politics, on the whim of the Eurosceptics within its own party.

For nothing is more calculated to keep Major's 'antis' quiet than the destabilisation of the EMU project - and so much the better for them if delay, or even disintegration, is the result of genuine economic troubles and not some cynical manipulation which the forces of federalism throughout the Union can point to as a malignant and unworthy foe.

Convinced that the problems now surrounding the single currency timetable are genuine, market-driven ones, it is taking an act of supreme self-control for Major and his cohorts not to dance around the streets of Brussels chanting loudly: “We warned you.”

In fact, Foreign Secretary Malcolm Rifkind did say as much during a meeting with his EU counterparts last week. Pointing to a growing credibility gap between the single currency timetable and economic reality, he added: “We are certainly pleased that the debate which has quite properly been taking place in the United Kingdom should now also be taking place throughout Europe.”

It is ironic that, while senior British politicians in high office feel free to condemn unpalatable EU polices when they seem unstoppable, a diplomatic silence descends when those same policies run into real problems.

“You don't kick a man when he's down because there's no need,” commented one insider this week. “It's the same with EMU.”

But just in case the single currency project gets back on its feet again too quickly for the government's electoral liking, the spin doctors have been hard at work, speculating on European Commission plans for retreat and musing on the folly of the UK's partners who find that, having taken a “great leap forward” in the name of the founding fathers, they are now in danger of falling flat on their faces on the path leading to an ever-closer Union.

No one really doubts that EMU will evolve, but the prospect of failure, of any timetable slippage, is grist to the mill of the Eurosceptics and those who must appease them.

It is “wishful thinking” to suppose that EMU will not happen, says Germany's Deputy Foreign Minister Werner Hoyer - but wishful thinking over Europe has a well-established track record in the UK.

It has, in fact, driven British policy on Europe since the heady days of Margaret Thatcher and nothing, except perhaps a complete change of government, will stop that now.

But can Thatcher's Euro-troubled successor afford to rely on wishful thinking to get himself and his slim parliamentary majority through a general election which must be staged by May 1997 at the very latest?

Whatever Major's personal views on the EU, his political survival depends on taking full account of his party's Eurosceptic wing - and while election fever has not yet broken out amongst voters, it is already evident in the rash of tit-for-tat exchanges between Conservative and Labour politicians inside and outside the walls of the UK parliament.

To mollify the Euro-malcontents, Major has quietly dropped his “heart of Europe” message. And to keep them in the fold, he has staked out his ground for the Intergovernmental Conference (IGC) and insists there is no question of retreat.

With a Eurosceptic gun at his back, he has boldly declared that the UK will scupper the next “great leap forward” and veto any attempt to give more powers to the European Parliament, extend the remit of the European Court of Justice or, crucially, diminish national governments' decision-making veto.

Major's gamble is that he will hold his factions together long enough to scrape through for a fifth consecutive term of office and live to complete the IGC process unimpeded by domestic pressure.

Then, if he has to make concessions, as has so often happened before when Tory rhetoric bumped into Euro-reality, he can afford to back down gracefully.

He is also relying on doubts over EMU, and the need to overcome public hostility to the very idea of a single currency and the painful medicine people are being forced to swallow to get there, to deter even the most ardent of Euro-enthusiast governments from pushing for radical changes at the IGC.

The present EMU timetable also means the election will be well out of the way before the UK will have to climb down off the fence and decide, once and for all, whether to join in the adventure or remain in the second group of what will inevitably become a two-tier club, politically and economically.

By then, of course, Major may be history. But the man who would replace him, Labour leader Tony Blair, has just as many mountains to climb to ensure unity over Europe. Apart from trumpeting the social chapter, it is significant that Labour now appears to be shadowing the Conservatives on many EU issues - an accurate reflection of the fact that squabbling over everything from Union membership itself to the scope of Europe's intrusion into national sovereignty is a cross-party pastime and now very much part of the fabric of British life.

Only if and when Tony Blair moves into Downing Street will it be possible to determine the degree of change in the UK's attitude towards the EU. Meanwhile, it is being left to senior Conservative politicians to creep about the British House of Commons trying not to ruffle any more Eurosceptic feathers.

That means no public Euro-sycophancy, but not too many outspoken attacks either - after all, it was an overdose of anti-Brussels rhetoric that led to Thatcher's downfall at the hands of her own party.

Only politicians freed from the shackles of high office, like former Foreign Secretary Douglas Hurd, feel free to speak openly about the grand European design.

And as the treasuries in Paris and Bonn and the number-crunchers at the European Commission ran round in ever-decreasing circles last week, revising economic forecasts and contemplating the truth or otherwise of Rifkind's 'credibility gap', it was Hurd who put a metaphorical arm around German Chancellor Helmut Kohl's shoulder and gently urged the great man to do the honourable thing by seeking a delay in the single currency launch programme.

“It is not logical for the UK to request a postponement,” Hurd argued disingenuously, “because the UK has no commitment to join.”

That, of course, has not stopped the British having their say before, but then EMU was not writhing in agony on the floor before.

Certainly the single currency hiccup is convenient for the Conservatives. But the smugness cannot last long. The IGC launch is looming, and it is too much for Major to hope that temporary lost confidence over monetary union means any let-up in the drive for more comprehensive political union in the long run.

None of this has much to do with a British public fed up with bickering over Europe. In a survey last month, more than half the UK electorate admitted their knowledge of the EU was poor. Nearly a quarter wanted to reject a single currency now. Another quarter wanted to keep the option open for the next five years.

The statistics confirmed what everyone knows - Britons are the most confused citizens in the EU, thanks to their Euro-schizophrenic political leaders.

As one Labour MP, Giles Radice put it: “The British aren't Eurosceptic. They're simply Euro-baffled.”