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Newly-elected Conservative MPs call on Cameron to use eurozone crisis “to shape Europe’s post-crisis order”;
German officials claim UK could still be liable for Greek bail-out via EU-wide fund

In a letter to the FT, 14 prominent Conservative MPs who won seats for the first time in last year’s election are calling on David Cameron to stop taking a “backseat” in the negotiations over the future of the eurozone. “We are concerned that the solutions to the crisis proposed by eurozone countries amount to no more than ‘throwing good money after bad’ and will further expose the British taxpayer to any future economic meltdown,” they say. The MPs argue that “the crisis affecting those countries that use the euro has created a political vacuum at the heart of Europe which we believe the UK government can use to shape the EU’s post-crisis order. In particular, the government must take a tougher approach than its predecessors, including the use of our veto to extract significant concessions. In their letter, they call for a return of powers to member states, “taking the taxpayers’ side in resisting “more bail-outs”, more trade liberalisation and renegotiations of the EU budget.

A separate article in the FT notes that, “The 14 Tory MPs…include some of the party’s rising stars, who are seeking to map out a more moderate eurosceptic stance, distinguishing them- selves from diehard sceptics.” Both the letter and the article quotes Open Europe research showing that the UK now has an exposure to the eurozone of over €700bn, mostly via the banking system, €300bn of which is to the weaker eurozone economies. On Conservative Home, Tim Montgomerie suggests that with “more time and without many of the new intake being limited by their PPS status the letter could easily have been signed by one hundred members of the new intake.”

Shadow Chancellor Ed Balls yesterday criticised Cameron and George Osborne for being “on the sidelines, irrelevant and ignored in these debates.” Writing inCity AM, Anthony Browne argues: “If Greece wants to renegotiate its treaty obligations to return interest rate setting powers to Athens, why shouldn’t other countries such as Britain throw in their demands?” An editorial in the Spectator notes: “The eurozone experiment is ending. The nation state is back. Britain has much work to do in reclaiming parts of our sovereignty that should never have been surrendered in the first place.”

Meanwhile, the Guardian suggests that German officials are pushing for the EU-wide bail-out fund for which the UK is partly liable – the EFSM – to be activated in a second Greek rescue package, despite Cameron’s claims that Britain will only contribute via its IMF commitments.
FT FT: letter Conservative Home Guardian City AM: Browne

Greek opposition destroys hope for consensus on new austerity package
The FT reports that the main opposition party in Greece, New Democracy, has announced that it will not support the new austerity package and pledged to vote against it in Tuesday’s crucial vote. Antonis Samaras, leader of New Democracy, told the FT: “They are asking me to support the same kind of medicine for someone who is dying from that medicine. I will not do it”. Despite the lack of consensus, the Greek government is expected to win the austerity vote with its slim majority, although this falls short of the EU/IMF demands for a consensus on the new fiscal package. Separately, new Greek Finance Minister, Evangelos Venizelos is reported to have angered other eurozone finance ministers by trying to renegotiate the austerity package, although Greek officials have denied this.

Meanwhile, the German, French and Dutch governments kicked off negotiations with their largest banks yesterday over the private sector involvement in the second Greek bailout. In a speech to lawmakers in Berlin German Chancellor Angela Merkel warned that “very few” banks in Europe supported the bond rollover, adding that, “Securing a majority for this course will not be easy”. Les Echos reports that Germany has halted the expedited pay out of €1bn in EU cohesion funds suggested by European Commision President Jose Manuel Barroso this week.

Open Europe’s Director Mats Persson appeared on RTE’s Drivetime programme yesterday, discussing what the next step should be for the eurozone. Mats also appeared on BBC Wales this morning discussing the topic, while Open Europe’s Raoul Ruparel appeared on Reuters TV. Open Europe’s finding that the UK could contribute to a second Greek bail-out to the tune of £1bn via the IMF is quoted by La Stampa’s London correspondent Andrea Malaguti on his blog. Open Europe’s report on the second Greek bailout continues to receive coverage, being cited in Die Welt, Berliner Morgenpost, De Standaard and several other papers and news sites. Open Europe’s finding that the ECB has €444bn exposure to the PIIGS is cited by Belgian magazine Trends.
FT BBC Le Monde Le Monde 2 Le Monde 3 FT 2 DW FT 3 FT 4 WSJ CityAM FT 5 FT 6 CityAM 2 Kathimerini Vima Capital Ethnos Kronen Zeitung WSJ 2 EurActivEurActiv 2 Les Echos Les Echos 2 Guardian Telegraph BBC: Today BBC: Today 2 IHT IHT 2 IHT 3 FD Dow JonesElsevier Letter Dutch government CityAM 3 Irish Independent Irish Times Irish Times 2 La Stampa: Malaguti RTE: Persson Die Welt Berliner Morgenpost EUReferendum Phil's Stock WorldIl SussidiarioInternational Business Times Standaard Investor.bg FigyelÅ‘ Kerdos.gr Le Figaro El País

Raoul Ruparel: “Delaying tactics are only increasing the costs of the eurozone crisis”;
French intellectuals: “The euro is dying”
On the FT’s A-list blog, Martin Feldstein argues that “a default by Greece is inevitable”, but must be delayed in order to prevent defaults in other insolvent eurozone countries like Portugal and Ireland. Responding to the article on the site, Open Europe’s Raoul Ruparel writes: “A second [Greek] bail-out is not the way forward. The EU needs to face up to reality and plan for an orderly debt restructuring as soon as possible, which could involve a limited cash injection. The current delaying tactic is only increasing the economic and political cost of the eurozone crisis.”

A leader in the Guardian argues: “Economically, socially and now politically, the status quo is unsustainable. Instead of postponing the inevitable Greek default, it would be far smarter to prepare for it.” A leader in El País argues: “It’s true that the Greeks have lost well-being: however, this is not only because of austerity, but also of recession. And if they have to tighten the belt now, it’s because, among other reasons, they used to wear it too loose.”

In an op-ed in Le Figaro, Gérard Lafay, Jacques Sapir and Philippe Villin argue: “The time has come for European politicians to face reality: the euro is dying; it needs to be finished off quickly in order to save the Europeans. But it seems appropriate to do it all together in order to avoid a deadly ‘every man for himself’ scenario…For France, the benefits of [eurozone] exit will be immense.”

In Prospect Magazine, Wolfgang Münchau writes, “The eurozone is based on three pillars: loopholes, fudges and lies. They made this crisis inevitable. The propensity to fudge now makes any real resolution all but impossible, even if it contains the problem.” Also in Prospect, Bronwen Maddox argues, “Could Greece destroy Europe? Yes: the current crisis could cause the eurozone as it now stands to unravel, and weaken voters’ commitment to the EU.”

A leader in FAZ disputes German Chancellor Angela Merkel's claim that Germany is the main beneficiary of the euro, arguing: "In the twelve years since the euro was introduced, Germany has had on average the lowest growth rate. It was with 1.2% significantly lower than the eurozone average of 1.5% or EU average of 1.7%."
FT: Alphaville FT: Feldstein FT: Ruparel Guardian: Leader BBC: Hewitt BBC: Peston BBC: Peston 2 Le Figaro: Lafay, Sapir and Villin El País: Vidal-FolchProspect: Maddox Prospect: Münchau BBC: Flanders Standard Irish Independent: Gary O'Callaghan Guardian: Sen FT: Lex El País: Editorial Les Echos: Delpla

Italian daily Libero reports that, in a speech at Lombardy’s regional assembly, regional councillor Romano Colozzi cited Open Europe’s research showing that the ECB holds €60bn of Greek debt and has lent €97bn to Greek banks.
Open Europe research Libero

Downing Street says UK will block Barroso’s new asylum proposals
Downing Street has said that the UK is building an alliance with other EU countries, believed to include France, to block EU Commission President José Manuel Barroso’s bid to amend to the so-called Dublin regulation, which allows member states to send failed asylum seekers back to their first country of arrival in the EU. The Guardian reports that David Cameron will press for the Barroso proposal to be watered down in the written conclusions of the EU summit which starts in Brussels today. He fears that strongly worded language in the conclusions would allow the commission to press for a change to be introduced to the Dublin regulation. This would be decided through qualified majority voting which means Britain would not have a veto.
Mail Guardian Express EUobserver Les Echos FT: Brussels blog

European Parliament lifts immunity of “cash-for-amendments” Romanian MEP
The Parliament reports that MEPs have decided to lift the parliamentary immunity of Romanian MEP Adrian Severin, one of the four MEPs involved in the cash-for-amendments scandal disclosed by the Sunday Times.

Meanwhile, following the news that the European Parliament last night bowed to three years of pressure by releasing a secret report exposing the widespread fiddling of expenses by hundreds of MEPs, the Mail quotes Open Europe’s Stephen Booth saying, “Naming and shaming MEPs would act as a deterrent to others.” Stephen is also quoted by the Parliament.
Mail Telegraph The Parliament The Parliament 2

Following Poland’s refusal to agree to plans to increase EU carbon emission targets, EU Budget Commissioner Janusz Lewandowski said yesterday, “More and more, there is a question mark put over the whole 'global warming' as such.” Meanwhile, Lib Dem MEPs and environmentalists have warned Conservative MEPs not to “undermine” David Cameron by voting against raising emissions targets from 20% to 30% in a vote in the European Parliament today.
Guardian EUobserver Euractiv

European Voice reports that an impact assessment from the European Commission has found that biofuel production from rapeseed, soybean and palm oil produces more green-house gas emissions than fossil fuel, once the environmental side-effects of production are considered.
European Voice

Yle reports that Finnish President Tarja Halonen has said that the eurosceptic sentiment which arose in the country during the recent general elections should be taken seriously.
Yle.fi

Süddeutsche Zeitung reports on rumours that EU Foreign Minister Baroness Catherine Ashton might not remain in her position for the whole term, as there are moves in the European Parliament and elsewhere to remove her from office by mid-2012 – which is, however, legally and politically complicated.
No link

EU Energy Commissioner Gunther Oettinger yesterday presented a revised proposal for a new EU directive which aims to increase energy efficiency by 20% over the next ten years. The 20% target will not initially be binding, although in 2014 this will be reviewed.
EUobserver El País

The BBC reports that the European Commission has said it has got £440m of savings to spend on its Galileo satellite navigation project, which will be used to buy at least six additional spacecraft before 2014.
Open Europe research BBC

Writing in Prospect Magazine, author of the book “Democracy in Europe” Larry Siedentop looks at the lack of a European demos and argues: “[Europeans] have come to feel that integration is not something they are doing, but rather something that is happening to them. This is not bleak nationalism, but a concern for self-government.”
Prospect: Siedentop

Romanian daily Evenimentul Zilei reports the European Commission has halted a payment of €850m for 120 projects in Romania and will launch an investigation following allegations of corruption among local politicians.
EuroTopics

EUobserver reports that the US has requested to be left out of EU plans to charge airlines for carbon permits.
EUobserver

Ta Nea reports that in 2007 the EU and US sought to suspend Cyprus’ voting rights in the European Council, as punishment following a referendum in which Greek Cypriots rejected the Annan plan for re-unification of the island, according to a Wikileaks cable.
Ta Nea Vima

World

Syria's Foreign Minister, Walid al-Moallem, has called EU sanctions on his country the equivalent to “war”, while promising to turn the country into a model democracy, reports the Guardian.
Guardian

New on the Open Europe blog

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Open Europe blog

The Commission is set to propose a 5% cut to staff numbers in the EU institutions: Does the ire of some EU staff show that the Commission is doing something right?
Open Europe blog