The three things Cameron should do next on the EU

By Tim Montgomerie
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Over the last 24 hours we have learnt that the Liberal Democrats are very angry. Friday's measured reactions to the EU 'veto' from Nick Clegg and Ming Campbell gave way to this morning's press briefings. On the Andrew Marr programme the Deputy Prime Minister said Cameron had been caught between the "intransigence" of the French and the intransigence of his Eurosceptic backbenchers. On Sky News Paddy Ashdown went further. The only thing Tory Eurosceptics hated more than the Coalition was Brussels, he said. The former Lib Dem leader said Cameron had been weaker than John Major in not standing up to his backbenchers. "Mr Cameron has acted as the leader of the Conservative Party and not the Prime Minister of Britain," he continued.

What are we to make of this? Is the Coalition in danger? Probably not. Clegg told Marr that it would be an "economic disaster" if the Coalition broke up. I'm not sure about that but it would certainly be an electoral disaster for the Liberal Democrats. They are struggling to get above 10% in the opinion polls. They'd be wiped out if they triggered an election on the basis of a decision by Cameron that has the overwhelming support of the British people.

Meanwhile the expectations of Conservative MPs are high. Many now think that Britain's new semi-detached status is the first step towards a wholly different relationship with Europe. Their hopes are based on two things. One, they now know the PM can be influenced. They, like the Lib Dems, are convinced that Cameron wouldn't have said "no" if he hadn't feared the reaction of his backbenchers. After watching the tactics of the Liberal Democrat Left during the earliest period of the Coalition they now understand the rules of the Coalition game. They know that the Coalition is a tug-o-war between Liberal Democrats and between them. Six weeks ago 81 Tory MPs picked up the blue end of the rope and pulled hard. Very hard. They voted for a referendum on Britain’s relationship with the EU. It was the biggest rebellion on Europe in post-war parliamentary history and amounted to a massive shot across David Cameron’s bows. Cameron feared that the next shot could have been a torpedo aimed at his government’s hull. That fear must have been at the back of his mind when he looked the German Chancellor and French President in the eyes and told them that he would not be part of a deal that did not protect Britain’s essential interests. Second, Tory Eurosceptics hope Cameron has noticed and enjoyed the press that he has received in the last 48 hours. The best, in my opinion, of his premiership (the BBC excepted). I agree with Graeme Archer*. Big cut-through moments are rare when politicians define themselves in the voters' minds. Clegg defined himself with his tuition fees flip-flop. Has Cameron defined himself with this "no"? I think he might well have done and will have answered Matthew Parris' recent question about his identity in the process. Matthew actually suggested a big fight with Merkozy might do the job! Cameron may now be an accidental hero of Eurosceptics (every inside account says Cameron desperately wanted to strike a deal - any kind of half-reasonable deal) but he may now go down in history as the first British Prime Minister to have vetoed an EU Treaty.

So what can Cameron do, caught between the communitaire Liberal Democrats and Conservatives who want more bulldoggery?

I suggest three things.

First, he needs to keep his Coalition together. That means helping Nick Clegg to pacify his party. Cameron might well win an election if one was held in the next few months but it would be a huge gamble and Cameron is not a high roller (unlike Mitt Romney). Tomorrow in the Commons statement on the EU talks he will need to be downbeat and statesmanlike. The whips will be ringing Tory MPs urging them not to incite the Lib Dems by being triumphalist.

Second, Cameron needs to manage expectations in his own party. Eurosceptic Tories aren't going to like operation pacify but he can promise them jam tomorrow. Three days ago such a promise would have fallen on deaf ears but Cameron has bought some credibility by his actions in Brussels. He should give a speech as Conservative leader, not as Prime Minister. He should set out a vision of what Europe would look like if he was master of the government. He should study Owen Paterson's interview with The Spectator. The Northern Ireland Secretary's interview won attention for the referendum remarks but it was just as interesting for its passionate and lucid vision of a Britain that isn't chained to the high tax, high regulation, high subsidy European model. Cameron has been reluctant to give a speech that suggests he is a Prime Minister who is compromised. Recently asked to name three things that Nick Clegg had stopped him doing he would only offer two. This reluctance to speculate about what might happen if he won the next election is understandable. Voters don’t want excuses from their Prime Minister and government. They want solutions and they want them now. A speech about the future is nonetheless the best way of reconciling what Mr Cameron needs to do to keep the Coalition together and to show that Friday morning's veto wasn't a one-off.

Third, he needs to hope. The PM may, this weekend, look isolated in the minds of the FT, Guardian and others who once fretted about Britain being outside of the €uro but he may look a lot wiser in a few months' time. The FU Treaty might not pass national parliaments when voters in Ireland, for example, realise that Germany will be effectively setting their tax policies. The markets will turn on the €uro if all they see is the long-term promise of a hospital in five years' time and no emergency treatment for today's bleeding European economies.

Cameron is in a strong political position today. The decisions he takes in the next few weeks will determine whether he builds on that position or he squanders it.

* Graeme tweeted that there had been two big moments in politics since the Coalition was formed; Clegg's tuition fees u-turn and Cameron's veto. I would add a third - Labour electing a leader who lacks the resolve to cut borrowing.