Germany and Britain on ‘a Collision Course’ Over the Future of Europe

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Germany and Britain on ‘a Collision Course’ Over the Future of Europe

‘Europe speaks German now,’ says leading German politician.

Britain must submit to an EU-wide tax on financial transactions, Volker Kauder, parliamentary leader of Germany’s ruling Christian Democratic Union, said at the party congress November 15.

“I can understand that the British don’t want that when they generate almost 30 percent of their gross domestic product from financial-market business in the City of London,” said Volker at the keynote speech. “But Britain also carries responsibility for making Europe a success. Only being after their own benefit and refusing to contribute is not the message we’re letting the British get away with.”

The day before, British Chancellor of the Exchequer George Osborne criticized an EU-wide financial transaction tax (ftt) in an article published in the Evening Standard.Europe certainly shouldn’t be creating new burdens,” he said. “Proposals for a Europe-only financial transactions tax are a bullet aimed at the heart of London. Even the European Commission admit that it would cost hundreds of thousands of jobs.”

“Germany and the UK are on a collision course,” the director of the European center of the Carnegie Endowment for International Peace, Jan Techau, told Bloomberg news. “The clashes we see now about deepening ties in the EU have always been there, but the crisis makes them more visible. Now it’s crunch time.”

This collision course can be seen even in the more diplomatic statements from each nation’s head of government. On November 9, German Chancellor Angela Merkel called for “a breakthrough to a new Europe.”

“The task of our generation now is to complete the economic and currency union in Europe and, step by step, create a political union,” she said.

On Monday, Britain Prime Minister David Cameron outlined an opposing vision for Europe. “We should look skeptically at grand plans and utopian visions,” he said at the Lord Mayor’s banquet in London. “We’ve a right to ask what the European Union should and shouldn’t do.”

Britain wants an EU that is “outward-looking—with its eyes to the world, not gazing inwards,” he said. It wants an EU that “understands and values national identity and sees the diversity of Europe’s nations as a source of strength.”

He condemned the transaction tax in the House of Commons on November 7. “In all the figures that we bandy around about the financial transactions tax, it is worth bearing in mind the fact that around 80 percent of it would be raised from businesses in the United Kingdom,” he said. “I am sometimes tempted to ask the French whether they would like a cheese tax.”

The financial transaction tax is a direct attack on Britain. But even apart from that issue, Britain and Germany are trying to push Europe in opposite directions. Germany, however, is the leader of Europe. As Kauder said: “Now all of a sudden, Europe is speaking German. Not as a language, but in its acceptance of the instruments for which Angela Merkel has fought so hard, and with success in the end.”

Britain won’t be able to keep its foot on the brake while Germany is pressing on the accelerator. Sooner or later Britain will get fed up with Europe and quit, or the EU will get fed up with Britain and kick it out.