Tuesday 10 January 2012


U.K. Ambivalence Toward EU Grows

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By ALISTAIR MACDONALD And CASSELL BRYAN-LOW


RAMSEY, England—As a young serviceman in 1975, Paul Rowland stepped into a polling booth on a British military base in Germany and made what he now considers to be a mistake. He voted in favor of the U.K.'s membership in what is now the European Union.

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Alistair MacDonald/The Wall Street Journal

Paul Rowland, outside his pub, now regrets his vote for the U.K. to join the EU.

Mr. Rowland thought he was making a simple choice to allow unfettered trade and easy travel between Britain and other European nations. Today, running a pub in this east England town, he complains that what the U.K. got instead was a load of unwanted regulation and costs.

"What we were asked about is a trading bloc," he said, looking across a village green that includes a statue of St. George, England's patron saint, slaying a dragon. "What we got has been ever-increasing political union."

Mr. Rowland's view is being widely echoed in Europe as the financial crisis in the European Union deepens. One recent poll suggested that more than half of Germans and French now regret joining the euro, at a time when the debt burdens of many members have helped push the zone toward a recession.

But in Britain, ambivalence toward Brussels—and arguing about its impact—has deep roots. When Prime Minister David Cameron rejected an EU treaty aimed at solving the euro-zone debt crisis last month, many Britons saw it as a moment that had long been coming. The Dec. 9 veto even kindled long-shot hopes among some in his Conservative Party that Britain can one day leave the EU.

Mr. Cameron, while saying he acted in Britain's interests, has been careful not to feed those hopes, saying that the U.K. needs the single market for trade, investment and jobs. Over the weekend, even as he vowed to block any attempt by his European neighbors to introduce an EU-wide financial-transaction tax, he said: "We are committed members of the European Union [and] committed members of the single market."

While a full schism seems highly unlikely, Mr. Cameron's political opponents say they see a growing separation from Europe that will limit Britain's influence in Brussels and hurt its international standing. "In Beijing and Delhi and Moscow and Washington, if you are strong in Brussels you are strengthened in these other capitals," said David Miliband, who served as the last Labour government's foreign secretary from 2007 to 2010.

Europe's patience is already thin, with some politicians complaining that British obstructionism has already stymied progress.

"A Europe without the English would progress much quicker," said Alain Lamassoure, a French member of the European Parliament. He listed several examples of what he said were U.K. efforts to throw up roadblocks, including opposing efforts by the current EU Polish presidency to establish a European chief of staff. The recent veto, he added, left some EU members exasperated.

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Yet some of Europe's leading federalists don't want the U.K. to leave. Guy Verhofstadt, a former Belgian prime minister and current member of the European Parliament, says the U.K. makes "an enormous contribution to Europe," both economically and politically on issues such as foreign affairs and defense. "It is far more credible to have the U.K. aboard with European policies," he said.

The new EU treaty, vetoed by a country that has never adopted the euro, aimed to allow greater fiscal integration for countries. Mr. Cameron nixed the accord after the EU refused to give in to his demand for protections from future EU financial regulations. In response, the EU has begun laying plans to enact the treaty within the EU, applying only to the nations that voted for it.

That's just fine with Ramsey, which is so skeptical of Europe that, in October, it became the country's first town to give majority control of its town council to the United Kingdom Independence Party, or UKIP, whose main goal is for Britain to pull out of the EU.

Britain's mixed feelings about the EU are often traced back to World War II. Germany and France's first moves toward greater integration came after a war in which both countries weathered Nazi authority. The U.K. didn't, and its stand against Nazi Germany is still a key part of the national psyche 70 years later.

"We left the war with our head held high, our independence and institutions vindicated," says Joan Coe, 80, who remembers watching Lancaster bombers taking off from runways near Ramsey as a child. "Most European countries did not."

Anti-European sentiment intensified in the 1980s under conservative Prime Minister Margaret Thatcher, who saw the European project as an opportunity for extending free-market policies but clashed with continental counterparts who wanted greater integration. The perceived loss of decision-making power to Brussels helped power a movement that led to Britain opting out of adoption of the euro in 1999.

In many ways, the U.K. has benefited from its association with Europe, while becoming more dependent on it. Today, the EU accounts for half of the U.K.'s overall trade of goods and services, up from 35% in 1973, when the U.K. joined the EU's predecessor, the European Economic Community, according to U.K. government analysis. The EU also accounts for 54% of foreign direct investment into the U.K.

But any benefits are being obscured these days by the U.K.'s economic woes, especially unemployment that is at a 17-year high. That has fed resentment toward the EU, whose coffers many Britons feel benefit more from the U.K. than the country does from it.

The U.K. Treasury calculates that over the last two years it will have paid £5.3 billion more annually into EU budgets than it has received in grants. Meanwhile, the government is cutting public spending at home in a bid to reduce its debts. Ramsey's district council, Huntingdonshire, will cut around 16.4% off its budget this year.

Local UKIP councilor Peter Reeve says this was a major factor in his party's majority. "Voters are asking, 'Why isn't our money being spent locally, why is it going abroad?' " he says.

Meanwhile, a flood of immigrants, partially enabled by EU membership, has fed angst about local unemployment, because by law the U.K. must grant the right to work to citizens from most other EU countries.

Gary Mac-Fall, a director at Collmart Growers Ltd., a vegetable-packing business based outside of Ramsey, says firing poor-quality staff has become much harder because of EU regulations that require companies to send two written warnings and conduct interviews before they can make layoffs.

Yet Mr. Mac-Fall acknowledges his business would be severely hampered without the flow of EU workers. Around 95% of Collmart Growers' work force is from Eastern Europe, as local workers in Ramsey are unwilling to work in his factory, he says.

Mr. Rowland, the Ramsey pub landlord, says his change of heart about the EU came when he saw what he calls the "wanton destruction" that EU rules and quotas brought to fishing towns on the northern English coast.

"It's an absolute mine field, there are so many rules and regulations and so many things that change all the time," said Robbie Roper, while fishing for prawn in the Irish Sea. Mr. Roper says he is asked to fish with a so-called Swedish grid, which is applied to fishing nets to reduce the bycatch of unwanted fish, but which his boat is too small to handle.

At the same time, 90% of his prawn and scallop catch is sold in Europe. Without the EU, "the [U.K.] prawn industry would collapse," Mr. Roper said.

This idea that Britain is being ruled by regulations from abroad feeds into a common theme in places like Ramsey: that local culture and identity is being threatened.

Brussels takes the blame for many things in Ramsey, deserved or not. "English culture is under attack, you can't even fly your own flag these days," said local Frances Holland, 65. The EU has no rules banning flying the English flag.