Bashing the United Kingdom is the most popular parlour game of Brussels. Recently the President of the European Parliament, Jose Manuel Barroso, performed a theatrical act in the European Parliament, accusing the British of 'Schadenfreude' with the demise of the euro. The self-proclaimed pro-European Groups showered him with praise. While Brussels' frustration with the euro crisis grows, so does its aversion to the British. London is becoming the scapegoat of Brussels' failure. But London is in a state of confusion. There is no convincing concept on the future of the UK in the EU. In the meantime, its euro sceptic population is kept at bay with promises of a referendum.
Within the EU, power relations are changing along two fault lines. The first one is a gap between the members of the Eurozone and those who do not (yet) belong to it. Apart from the UK and Denmark, from a legal perspective all EU member states are either in the Eurozone or a candidate for becoming one. Most countries not (yet) in the Eurozone do not seem to be in a hurry to join. For the UK, resisting the euro was a matter of principle, automatically turning London into a target for the European elites who regard the euro as a crowbar to force a political union. The second fault line is a North/South gap within the Eurozone, featuring Germany as the prime northern country versus Southern Europe demanding transfers. The Dutch are in the same boat as Germany. The UK positioned itself outside this fault line, but at the same time its economic recovery is linked to the fate of the euro. London is a global financial centre and the British economy is suffering from the euro crisis. Prime Minister Cameron fears for his re-election because of the stagnating economy.
'Schadenfreude' is therefore not the right word. The British are affected by the crisis either way. UK export to the EU in 2010 reached £210bn. Export to the US was £72bn and to the Commonwealth countries £37bn. Imports from the EU had a value of £243bn. Barroso's remarks find their roots in frustration over the fact that the British made the right analysis on the euro, from the very beginning. Fifteen years ago, William Hague - current UK minister of Foreign Affairs - labelled the monetary union 'a burning house without exits'. Two years ago, Barroso described the euro as a 'protective shield against the crisis'. Who turned out to be right? Britain Bashing is an extension of Brussels' intellectual error it will never admit. So, instead of looking in the mirror, it is the UK conspiring against European integration. The City of London speculates, the UK government dismisses and the British population resists. After Napoleon's empire and the German Third Reich, continental Europe finally found a new enemy.
The insular mentality of the British people makes them instinctively euro-sceptical, but its political elite – be it Labour or Tory – wants to keep the country in the EU. The dangers the UK faces when outside the EU outweigh those when staying in. The euro zone is in current circumstances doomed to become an area of permanent stagnation, even with the creation of an economic, monetary and political euro block. Southern Europe lost its competitive advantages and transfers will do nothing to change that. On the contrary; transfer addiction is a real risk. Germany and the Netherlands however, are becoming more and more hesitant to contribute to those transfers. Voters in both countries get nervous. The political tension within the euro block increases and – on French instigation – the root of all problems is to be found on the other side of the Channel: Anglo-Saxon conspiracies. Barroso's statement shows to what extent this sentiment has already taken hold of European elites.
Without the UK as EU member, economic liberalism on the continent will be completely marginalised. In Germany, liberalism is dying; in France it is a swearword. With an orphaned liberalism, a continental political block will be centralised, protectionist and authoritarian. A EU dominated by the French and the Germans will squeeze UK access to the single market and target London's financial heart by adopting EU legislation producing an extra territorial impact. The US is far away and the Commonwealth – accounting for just eight percent of UK export – is no viable alternative. A small trading nation such as The Netherlands needs the UK more than ever, in the EU.
While the British elite reacts from the ratio, the British voters react from the heart. And it is felt by the Members of Parliament in Westminster. Last year, Cameron had to face an uprising in his own ranks, when conservative MEPs demanded a referendum on Europe. Last month, former minister of Defence Liam Fox, called on the government to 'renegotiate its relations with the EU'. He wants to transfer certain competences – for instance those involving social policy – back to London. Cameron subsequently did not rule out a referendum. He did not specify when, or on what question. Would it be a simple 'EU membership yes or no', there is a likely chance that it will be a 'no'.
This domestic pressure makes the British stance difficult to grasp for their friends. When it comes to the first fault line, Cameron is hoping that the fully integrated euro zone will renegotiate the position of the UK following its shift to the margin of the EU. Concerning the North/South fault line, he will sympathise with the Germans, the current the paymaster, for the British would never be willing to display that generous a ‘solidarity’. Pragmatic reasoning however, will force him to support a banking union, though only as long as the UK stays out of it. He is in favour of Eurobonds, as long as the British do not have to pay themselves. He aims for renegotiations, but simultaneously promotes a continental block that will inevitably turn against the UK. Britain Bashing is just the prelude.