After this crisis, Britain may get the kind of EU it wants | Mats Persson

Its main proposals are failures, but the Franco-German summit also points toward Brussels to an intergovernmental model

The conclusions of the Franco-German summit earlier this week are not exactly a resounding success. The two main proposals: a tax on financial transactions (ITF) and a "golden rule" to be established in the constitution of each member of the euro area, have been proposed before and already looks dead in the water

As my school has argued for some time, an FTT would be suicide if the EU was alone - something that the Germans now seem open. Swedish Prime Minister Frederik Reinfeldt, said it best: "I do not believe in this idea ... Sweden is interesting, because we are the only country with real experience in this type of transaction tax is imposed if only part of a market. Our experience is that it provides small amounts of income, but the transactions on. "In the United Kingdom is responsible for approximately 73% of all financial transactions in Europe, and thus losing heavily in the absence of an agreement to share the load -. The Treasury has no choice but to strangle at birth proposal

Similarly, to implement the proposal of Sarkozy-Merkel, for reform "golden rule" constitutional for all eurozone members - legally cap the amount of debt they are allowed to accumulate - would be anything but simple. the Netherlands would be required to dissolve the lower house of parliament and new elections. In Italy, a two-thirds majority needed in both chambers, while in Ireland that could eventually be looking at a referendum, and so on. So why the two leaders are still in first place, given that his proposals will do nothing to stop the immediate crisis in the euro area, and are impossible to implement anyway? Give them credit, however, to find ways to defraud the market.

However, outside the content disappointing, the last of Sarko-Merkel office politics is very interesting for more reasons, particularly for the United Kingdom. Unfortunately, it was widely misunderstood in Britain and beyond.

First, it is one of a kind of great German plan once again become the dominant force in Europe - that nobody in Germany is interested in "colonial" countries in any form ( this is just the opposite - that Germany abstaining from voting in the Security Council of UN intervention in Libya). In all cases, the emphasis on a "golden rule" is derived from the traditional German economy of thought grow when subjected to clear rules, and desire (understandable) for a quid pro quo for the signing of Portugal, Italy, Ireland, Greece and Spain. It will not work, but there is nothing sinister here. Support for the FTA is based on a misunderstanding of how markets work.

• Second, the Franco-German proposal is a step into the "federalism in the EU" itself. In fact, the letter distributed by the two leaders are expected only a limited role for the European Commission economic governance in the euro area, with the Euro instead of 17 members to meet separately.

speaking in Brussels, this is called intergovernmentalism, often described as the opposite of federalism. It is the centralization of the participating parties, but gives Member States, rather than the technocratic Commission, the European Commission in the Federal Parliament or the European Court of Justice in the center. Why this theme? Because the reflexes tend to favor the British intergovernmentalism modeled around the decisions of sovereign states, rather than institutions based in Brussels. Far from the struggle against the British thought, the Franco-German proposal seems to strengthen it.

There is another reason why the agreement appears to be in line with what many British instinct in charge: variable geometry Europe. In response to this proposal was opposed in many capitals, the German Foreign Minister, Guido Westerwelle, said privately (according to the Financial Times Deutschland) that all Member States that do not implement the plans Franco- German "should not be allowed to leave the rest" to do so, adding that "there should be a more differentiated cooperation," probably both in the EU and the euro area.

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