Thursday, 8 December 2011

Rob Burgeman: Anyone for tennis?

The next few days are vital ones for the eurozone.  If the issues that the key summit were attempting to tackle stopped at the borders of the seventeen countries that comprise the eurozone, this would be serious, but containable. Unfortunately, they do not. The effects of a failure to deal adequately with the sovereign debt crisis sweeping through Europe would be felt across the planet.  The heads of state gathering in Brussels will be all too aware of this and the profound effects that a failure to rescue the monetary union would have. National interest will have to be reconciled with….well, ultimately, long term national interest as there would be no winners from a disorderly collapse of the Euro.  As someone pointed out a while ago now, the politicians all know what they need to do to solve the problem. They also know that they would be unelectable having done it.
The position of David Cameron is also likely to be in focus over the next few days. Splendid isolation as a strategy may have been a lynchpin of British foreign policy in the 19th Century, but it would be an extremely dangerous one to adopt now. We may not be of the Euro, but our economic fate is inextricably linked with the fortunes of our continental cousins and the decisions made over the next few days are likely to significantly change the landscape. What is needed is a seat at the table rather than kicking the table over, as is demanded by some of Mr Cameron’s more eurosceptic party members. 
So, what will be required is a degree of pragmatism and co-operation that has been remarkable by its absence over the last few months. Difficult decisions will need to be made and national interest will have to be potentially compromised. Reading the tea leaves, the signs are more positive. Angela Merkel and Nicolas Sarkozy made some key compromises in their meeting earlier this week and seem to be prepared to reconcile the differences between a federal and multi-national solution to the problems. Support, too, has come from the other leading global Central Banks who have promised as much liquidity as necessary to avoid the banking system grinding to a halt. The ball, now, is very firmly in Europe’s court.

As Norman Schwarzkopf said, “The truth of the matter is that you always know the right thing to do. The hard part is doing it.”

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