Richard North, 07/11/2012  

Reuters 943-keg.jpg

Inevitably – and completely understandably – with the focus on the US election, even the British media are not trying very hard with the Merkel-Cameron meeting today. Most seem to be copying out the Reuters report, which seems to apply to the German media as well, with the same headlines.

In what has all the hallmarks of being driven by the Downing Street publicity machine, one sees the emphasis on the multi-annual EU budget negotiations, with Mr Cameron continuing to play to the domestic audience, keeping attention focused on the budget, rather than the broader issues.

Tucked in at the end of the BBC report, however, us the short note that, "if no agreement is reached by the end of next year the 2013 budget will be rolled into 2014 with a two percent rise to account for inflation". In other words, come what may, there is going to be an increase … and then there are the supplementary budgets.

Reuters, though, does allow for German officials becoming "exasperated" by what they see as "London's slide towards Europe's margins", but it only manages to cite Gunther Krichbaum, head of the German parliament's EU committee. He warns against the island mentality of states like Britain "who want less Europe rather than more". "The European Union is not a multiple choice," he says (which, of course, it is).

It is perhaps slightly comforting to learn from this that some of the German commentators are just as dense as their British counterparts, but this time we do get some interesting commentary from this side of the Channel, from Janan Ganesh of the Financial Times who asserts that "Britain and Germany are growing apart".

Germany will do almost anything to preserve the euro, he writes, even at its own economic cost. [British] Ministers have long believed that Ms Merkel would sooner turn her back on the eurozone's periphery than underwrite the currency with German money or compromise its view of how the ECB should operate. "Only recently have they shed this delusion", writes Ganesh, although one is not yet sure that the media have entirely caught up.

Less helpful is a piece from the Telegraph's favourite crutch, which tells us that "Germany is desperate to ensure that integration does not destroy the single market, which remains an asset".

This is golden boy Mats Persson, of the europlastic Open Europe, who confidently tells us that the German "desperation" should include making sure that any eurozone banking union doesn't push the City of London "offshore", which would cut off a facilitator of investment and a gateway to global markets for Germany.

There goes the europlastic creed: both London and Berlin support the prudent use of public money, "and oppose the papering over of economic cracks through fast and loose money". Both, we are told, want to boost cross-border trade, in Europe and across the world. And this, if the British Government "stops its misguided lecturing, and advocates that kind of change, it may find it has more friends than it realised".

One does enjoy the confidence of such assertions, but only on the basis that one can recognise the "fools rush in" syndrome, where even seasoned and knowledgeable German commentators fear to tread. They fully understand that German sentiment is ridden with factions and there is no such thing as a single, united "Germany", with a single, coherent view.

Thus, the problem is misdiagnosed – partly - as Germany and Britain "talking past each other", a viewpoint which ignores the integration dynamics which are driving events in the eurozone. As long as these exist, and the UK is not in the euro, there is never going to be a meeting of minds.

But then, Open Europe has its own agenda, which makes it one of the least trustworthy of commentators on the block – but ideally suited for a newspaper which used Janet Daley to forecast the result of the US election.

More sanguine analysts will be watching closely to see whether Merkel is prepared to throw Cameron a bone today, which might help him on his domestic crusade. That is the most important issue for him, but Merkel has a general election next year, and she must watch her own domestic audience. 

That, possibly to Cameron's discomfort, may help solve the mystery as to why Merkel is really in London later today.


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