international analysis and commentary

David Cameron’s calculated risk on the EU

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With his pledge to put Britain’s European Union membership to a referendum within five years, David Cameron has taken a gamble – both at home and with his allies in Europe.

The British Prime Minister, finally delivering a much-awaited and long-delayed speech that was billed as a defining moment of his career, said he wants to renegotiate his country’s relationship with Europe and then put those new terms to a public vote, should his Conservative Party win the general election to be held in 2015.

If all goes his way, he will win the election and persuade Britons to stay in what he hopes will be a streamlined bloc built around the single market. In a less rosy scenario, he would lose the general election, or still win but become the prime minister who has led his country out of the EU, a pillar of British policy for decades.

Cameron said discontent with the bloc was at an “all-time high,” with democratic consent for continued membership in Britain “wafer-thin.” He listed the bloc’s shortcomings, citing a crisis of competitiveness and the frustration of European citizens over their governments’ response to the eurozone crisis. Faced with such issues, he argued, inaction could have costly consequences.

“If we don’t address these challenges, the danger is that Europe will fail and the British people will drift towards the exit,” he said, adding:” I believe in confronting this issue – shaping it, leading the debate. Not simply hoping a difficult situation will go away.It will be an in/out referendum.”

Despite these strong words, the speech was carefully calibrated to reassure both his European allies and Washington, which has publicly urged London to remain part of the EU. The Prime Minister left his demands on Europe vague, without specifying what powers he would like Britain to regain from Brussels, and he emphasized both the benefits of staying and the risks of going. “If we left the European Union, it would be a one-way ticket, not a return,” he said.

Cameron insisted his priority was not engineering an exit but negotiating a more comfortable relationship. Once that is achieved, he said, he will campaign “heart and soul” for a Yes vote at the referendum, to be held at the end of 2017 or early the following year.

But Cameron has also been adamant that he wants a more flexible Union, not the closer integration advocated by many during the eurozone crisis.

“Countries in Europe have their histories, their traditions, their institutions, want their own sovereignty, their ability to make their own choices. And to try and shoehorn countries into a centralized political union would be a great mistake for Europe, and Britain wouldn’t be part of it,” he said in Davos the day after his speech.

Although any referendum is years away, Cameron is hoping to reap benefits immediately.

Domestically, he hopes the pledge will placate rather than embolden eurosceptics in his party, who have long demanded a tougher line on Europe and had been growing increasingly vocal and impatient (Tory MPs cheered when the Prime Minister walked into the House of Commons shortly after the speech; some of them are now asking that the referendum be held sooner). Cameron is also hoping to pre-empt a possible electoral threat from UKIP, the populist, fiercely anti-European party led by Nigel Farage that has been surging in the polls at the expense of the Conservatives. Ultimately, Cameron believes that citizens unhappy with the current EU deal will reward him for seeking a new one and putting it to a vote. If he is right, he could mount a comeback and overcome the Labour Party, which has been consistently and solidly leading in the polls.

The Labour leader, Ed Miliband, who has accused Cameron of bowing to eurosceptic pressure for domestic gain, is against an in/out referendum. Nick Clegg, head of the Liberal Democrats and Cameron’s uncomfortable coalition partner, said the pledge would bring years of uncertainty. But now that the issue of a referendum is on the table, it will be difficult for either the Labour Party or the LibDems to remove it: To do so would require campaigning against giving a voice to the people. And the last referendum on Europe was held almost 40 years ago, in 1975 (on that occasion around 67% percent said Yes to Europe, but this time the result is likely to be far closer).

While eurosceptics praised Cameron, critics were quick to dismiss his plan, resorting to an array of metaphors “You can’t do Europe à la carte” (French Foreign Minister Laurent Fabius); “Cherry-picking is not an option” (German Foreign Minister Guido Westerwelle); our partners “do not regard the European Union as a sort of cafeteria service, in which you bring your own tray and then leave with what you want” (Labour MP and former EU Commissioner Lord Mandelson); “Imagine Europe is a football club and you join, once you’re in it you can’t say, ‘Let’s play rugby’” (Fabius again).

Some business leaders have warned that many years of uncertainty over the country’s future could affect investment in an already stagnating economy. But Cameron’s gamble is that the threat of a “Brexit” may strengthen his hand in negotiations with the EU. That the risk of losing Britain – a crucial if reluctant member of the bloc for decades and its third-largest economy, a country with a strong military and a special relation with the US – will outweigh any anger over its demands. And if he can persuade his EU partners to give him what he wants, he believes, then the British people will follow.

Cameron could also be counting on Germany to want to keep in a champion of economic liberalism to balance the attitude of France and some southern states. Chancellor Angela Merkel was careful not to reject the British position outright in her first reaction to the plan.

Perhaps fittingly, Cameron’s speech came as Britain marks the 40th year since it joined Europe – a bittersweet anniversary for this uneasy marriage. The address will likely go down in history as one of the key speeches on Europe by British prime ministers, along with Harold Macmillan’s push to join the European Economic Community in 1961 and Margaret Thatcher’s defense of nationhood against “a European super-state” from the city of Bruges in 1988.

Whether it is remembered as a diplomatic masterstroke that increased British sway on the continent or as the first step toward an unhappy divorce hinges on the success of Cameron’s gamble.