As Europe plots closer ties, Britain mulls split

[November 20, 2012]  BRUSSELS -- Goodbye, Britain?

For the European Union, a once-unthinkable question is looking more like a real possibility with each new grinding week of economic crisis. The reason is that bad times are forcing the 17 EU nations that use the euro currency to move ever closer toward some kind of United States of Europe -- one that could make decisions about how much member countries spend and how much tax they collect.

If ever Britain had a nightmare, that's it.

The British public shows no interest in moving closer to the rest of Europe, and most can't even seem to stomach the status quo. The real question these days appears to be whether to drift away or break away abruptly.

After a 2015 election, Britain -- among 10 of the 27 EU nations that don't use the euro -- is likely to hold a referendum on whether to leave the EU. Even if it doesn't hold a vote, the country is already unpicking its ties with Europe, a movement that has unsettled Germany, which is eager to retain the U.K. as an important economic driver of the bloc.

"I will ask the inhabitants of the wonderful island to reflect that they will not be happy if they are alone in this world," German Chancellor Angela Merkel said in a speech before visiting British Prime Minister David Cameron last week in London.

Her outreach, however, has little impact here. British Foreign Secretary William Hague, who once toured the U.K. on a "Save The Pound" campaign that opposed the euro, believes the British public has never been more skeptical of European unity.

"Public disillusionment with the EU in Britain is the deepest it has ever been," he said last month. "People feel that in too many ways the EU is something that is done to them, not something over which they have a say."

Such distrust is tangled with worries over the fallout from the European debt crisis and anger at the European Court of Human Rights -- castigated by British politicians for ordering Britain to give prisoners a vote in national elections, and preventing the U.K. from deporting terrorism suspects to countries with patchy human rights records.

Even more alarming for many in Britain, Merkel called last week for turning the European Commission, which currently drafts legislation and regulates competition, into "something like a European government." The phrase alone rattles the teeth of many British politicians, who have warned for decades of the specter of a European superstate.

"Withdrawing from the EU can no longer be dismissed as unthinkable. It is no longer a marginal view confined to mavericks, but a legitimate point that is starting to go mainstream," Douglas Carswell, a legislator with Cameron's Conservative Party, told Parliament as it debated the idea of leaving the EU.

Last month, Cameron faced a huge rebellion within his own party as 81 of the 303 Conservative lawmakers defied his orders and voted to hold an urgent referendum on EU membership in 2015.

Under pressure from his own party and watching nervously as his traditional supporters are wooed by UKIP, a minority political party that advocates EU withdrawal, Cameron is expected to eventually offer Britain its first referendum about staying in the EU since 1973. The opposition Labour Party says it too would back holding a vote -- but only when the eurozone crisis has come to an end.

Even without a decisive split, there are signs already of the diverging paths of Britain and the EU:

• Because Britain does not use the euro, it has no voice in the decisions that affect the 17-member eurozone. It is worth remembering that all but three EU countries -- the UK, Denmark and Sweden -- are committed to using the euro eventually. So the eurozone meetings could one day be meetings of almost the entire European Union, with only three member states excluded.

• In March, 25 EU members signed a Fiscal Compact to provide for stronger oversight of national budgets. The two that didn't sign? The Czech Republic and Britain.

• In October, 11 EU countries decided to go ahead with a tax on financial transactions. EU officials predict the number of participants will swell to more than 20. Britain will not be among them.

• Next year, EU officials will be working to set up a single banking supervisor for banks in countries that use the euro. Britain has said it is concerned about the prospect of decisions being made over which it has no say.

• Britain is planning to opt out of 130 European agreements on crime and justice -- hoping to instead pick and choose how and when it cooperates with its neighbors on law enforcement. The decision would risk undermining the European Arrest Warrant system, which allows police to reach across European borders to easily arrests fugitive suspects.

The trend has political leaders in other countries worried.

"If the eurozone is much more integrated and those outside are far away, the distance can become too wide and too large," Andreas Mavroyiannis, Cyprus' deputy minister for European Affairs, told The Associated Press. And that, he said, would be dangerous for the EU as a whole.

Officials in Brussels are deeply concerned, as well.

"Probably rightly, I've been called an Anglophile," Jose Manuel Barroso, president of the European Commission, said in a magazine interview this summer. "I believe that Europe without Britain at the heart will be less reform-driven, less open, less an international Europe. That is why sometimes when I look at the debate in the U.K., I ask myself: `How is it that this country is so open to the world, and apparently so closed to Europe?' It seems a contradiction."

The prospect of a British exit from the EU alarms some British business leaders, who see the bloc's free markets as vital to their nation's prosperity.

"Whatever the popular appeal may be of withdrawal, businessmen and politicians must keep a bridge firmly in place," said Roger Carr, the president of the Confederation of British Industry, the nation's biggest business lobby.

"As countries of Europe bind together in pursuit of salvation, we in the U.K. must work harder to avoid the risks of isolation."

Former British Prime Minister Tony Blair, who left office in 2007 before the debt crisis struck, is another lonely advocate for British leadership in Europe.

"The 21st century case for Europe is based not on war or peace but on power or irrelevance," Blair said last month. "Europe carries weight, multiplies opportunity and makes sense for its individual nations."

He has urged Britain's government not to walk away, but to help build a new structure to help Europe balance the competing demands of the 17 eurozone nations and the remainder of the European Union.

"It is a very tricky task. But it is an essential one if the U.K. is not to be sidelined," Blair said.

Peter Mandelson, a former member of Blair's Cabinet and ex-European Union trade commissioner, warns that going it alone would mean waning influence for Britain on the global stage.

Britain, he said, soon could be a "Hong Kong to Europe's China, or a Canada to Europe's United States."

[Associated Press; By DON MELVIN and DAVID STRINGER]

Stringer reported from London. Don Melvin can be reached at http://twitter.com/Don_Melvin.

Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.