We’re right about the euro – that’s why Europe is angry

No, they aren’t really angry with us for opposing the new Treaty for Fiscal Union. The reason our brother and sister Europeans are so chronically enraged with the British is that we have been proved completely right about the euro. For more than 20 years, British ministers have been coming out to Brussels and saying that they just love all this single-market stuff, but that they doubt the wisdom of trying to create a monetary union. And for more than 20 years, some of us have been saying that the reason a monetary union won’t work is that you can’t do it without a political union – and that a political union is not democratically possible.

We warned that you would need a kind of central Euro-government to control national budgets and taxation, and that the peoples of Europe wouldn’t wear it. Now look. It wasn’t the Anglo-Saxon bankers who caused the trouble in the eurozone, Sarkozy mon ami. It was the utter failure of the eurozone countries – starting with France, incidentally – to observe the Maastricht rules. It was the refusal of the Greeks to control their spending or to reform their social security systems. In Greece and Italy, the democratic leaders have been effectively deposed in the hope of appeasing the markets and saving the euro; and what makes the leaders of the eurozone countries even more furious is that it doesn’t seem to be working.

They blame David Cameron for “vetoing” a new EU treaty, when really he has done no such thing. It is perfectly open to the other EU countries now to go ahead and form their own new fiscal rules. If they want, they can decide to create an economic government of Europe. They may decide that now is the time – even though electorates are already feeling alienated from the political process – to hand sensitive decisions on tax and spending to unelected bureaucrats. It strikes me that this would be an amazingly dangerous thing to do, since the peoples of this Supra National And Fiscal Union (Snafu) would rapidly discover that they could no longer remove their government from office. I doubt very much that it would work, since there seems no particular reason why national governments should respect a collection of new “binding” rules any more than they respected the “binding” rules of Maastricht – not unless there is some secret proposal to enforce them by violence with a Euro-army.

But even if the Snafu has little prospect of success, there is no reason for David Cameron to commit this country to a project that is intellectually, morally and democratically bankrupt. He was quite right to say that Britain would not participate; and the reason the others are angry with Britain is that the row conceals the real failure of the summit – and that is to come up with a solution for the problems of the euro. The best hope now is for everyone to cool off and look at the things that the citizens of Europe actually want from their institutions. The euro may or may not be saved – though it seems unlikely that it will still exist in exactly its current form a year from now, and the best thing would be if the Greeks (and perhaps others) were allowed an orderly exit from their pain.

But there are still plenty of things that the European Union could provide its struggling peoples. In January, it will be 20 years since the dawn of the “single market”, and yet there are still all kinds of non-tariff barriers to trade. Here we are trying to create an economic government of Europe, and yet we haven’t even passed the services directive, which would allow everyone from opticians to estate agents to insurance brokers to set up more freely in other European jurisdictions. We are telling the Greeks that Brussels must effectively run their economy – and yet we can’t even agree on a common European standard for plugs.

Everyone is now worried that other European countries will “punish” Britain, perhaps with new directives on financial services designed to damage the City of London. Well, in so far as that is a problem, it is not a problem that has been made any worse by this summit; and in so far as we need to assert our European credentials, now is the time to set out a positive vision for a Europe that actually helps individuals and businesses. Next time these leaders have a summit, let’s lock them in until they agree the services directive and come up with a Europlug.