Squeezed.

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Cameron's Hopeless Task on Europe

Clive Crook is a Bloomberg View columnist and writes editorials on economics, finance and politics. He was chief Washington commentator for the Financial Times, a correspondent and editor for the Economist and a senior editor at the Atlantic. He previously served as an official in the British finance ministry and the Government Economic Service.
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On Tuesday, in a speech in London and in a letter to the president of the European Council, British Prime Minister David Cameron set out his demands for reform of the European Union. It was a deft performance and his efforts deserve to succeed -- but I don't give much for his chances.

Cameron confirmed that he wants changes under four main headings. First, on economic governance, he wants "legally binding principles" to ensure "no discrimination and no disadvantage" for EU countries that don't use the Euro (meaning, at the moment, Britain and eight others). Second, he wants new initiatives on EU competitiveness and trade liberalization. These goals look achievable.

Third, to answer complaints about diminished sovereignty, he wants to give national parliaments more say and revive the principle of subsidiarity (more Europe where necessary, less where possible). Finally, he wants to regulate immigration by preventing so-called abuses of the EU's free movement of labor. Both of these will be harder, and a lot will depend on how flexible the U.K. and its partners will be over the details.

QuickTake Will Britain Leave the EU?

All four demands were unsurprising -- Chancellor of the Exchequer George Osborne had previewed the main points already -- but, regardless, the speech angered Tory euroskeptics. They think it much too timid. One of them, David Nuttall, said the prime minister was "tinkering around the edges," and many agreed.  

So the prime minister's effort to mend his party's great breach over Europe is failing. Many of his parliamentary troops will likely argue for exit during the campaign leading up to the promised referendum on Europe, wherever Cameron stands on the issue once his renegotiation is done. The Conservative Party may yet break up over the issue.

It was always going to be this way. Any outcome that was acceptable to Britain's euroskeptics would be unacceptable to Britain's EU partners, and vice versa. Cameron's hope is to persuade enough of the electorate that he's won meaningful concessions, that the U.K. will hence be better off as an EU member, and that the country should vote to stay; then, with that accomplished, he can be forgiving in victory and strive to reconcile the opponents of the deal to their defeat.

A tall order. But the depressing thing is that even if Cameron succeeds, he'll fail. He might save the Conservative Party and keep the U.K. in the EU, but he won't reconcile the country to its place in Europe. The dilemma is inescapable: Cameron is most likely right that Britain would fare better as part of a modestly reformed Europe than as an outsider; but the euroskeptics are right that, without much more radical reform, the British will continue to be unhappy Europeans.

One can imagine constitutional reforms that could and should satisfy Britain and, by the way, would be good for the rest of the EU. Unfortunately, one can't imagine them happening. Cameron has carefully asked for the most he can plausibly get. Even if he gets it all, he won't have solved the big problem, and that's Europe's democratic deficit.

Immigration policy looms largest at the moment because of Europe's refugee crisis, but in the longer term, constitutional issues -- sovereignty and subsidiarity -- will matter most. They are the deeper source of discontent with the EU, and not just in Britain.

Cameron wants to formally end Britain's treaty commitment to "ever closer union," and proposes an arrangement that would make it easier for groups of national parliaments, acting together, to block EU initiatives. Both would be valuable, assuming other EU members could be persuaded to go along (which isn't to be taken for granted). But these changes don't go far enough to provide the democratic legitimacy that voters feel is lacking. In particular, the EU would still have a parliament that commands no respect and pays no attention to the wishes of Europe's voters, most of whom don't bother to cast ballots in EU elections.

This defective institution should be replaced with an assembly of delegates drawn from national parliaments. Members of this assembly would thus have a dual mandate, national and European, similar to the arrangement that prevailed until 1979. They'd be elected at home in ballots with respectable turnouts, and after rival policy programs have actually been in contention -- unlike elections for the European Parliament. This would supply some of the missing legitimacy and help integrate European policy issues into national political debate.

In addition, the EU's incursions into domestic law need to be not only better disciplined in future but more easily reversed. How much Cameron's demands on sovereignty and subsidiarity can achieve on this will depend on the details of what's eventually agreed -- but any changes are unlikely to go very far. It isn't enough to check the EU's momentum as a law-generating juggernaut, which is Cameron's main goal. Strong procedures, including a new judicial mechanism, should be put in place to test the existing dispensation and roll it back where the principle of subsidiarity has already been breached.

If Cameron demanded all that, the governments of France, Germany and much of the rest of Europe would laugh in his face. At the moment, they're trying to be patient -- listening indulgently with a view to helping him out.

That's the best Cameron can hope for. Shame it won't be enough.

Cameron Outlines His EU Negotiation Demands

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story:
Clive Crook at ccrook5@bloomberg.net

To contact the editor responsible for this story:
Christopher Flavelle at cflavelle@bloomberg.net