John Kampfner: Europe's golden age is gone for good

It did for John Major. It stopped William Hague in his tracks. Europe has this week produced a resurgence of the rabid tendency among David Cameron's Conservatives.

The Prime Minister knew the lull would not, could not, last.

For five months, the "E" word had barely figured in the headlines. But the sudden squall at this week's Brussels summit on the EU budget has brought the issue back to the fore at Westminster. Tory MPs, peers and MEPs are accusing Cameron of a "Vichy-style surrender" and the European Union of a "massive power grab".

When he reports back to Parliament on his negotiations, Cameron will receive more hostile fire. Some in his ranks see any compromise with the EU as part of a long-term federalist conspiracy in which Labour governments happily connived and Tory governments miserably acquiesced. Others are using the issue as a proxy to take on a Prime Minister whose overall ideological limpness was confirmed by his coalition deal with the Liberal Democrats. Most of these Eurosceptics simply want Britain out, in the quaint assumption that this middle-ranking island can somehow thrive in blissful isolation.

That is not to say that they do not have a rational case on this one. Cameron's agreement to a 2.9 per cent budget increase for 2011 is, to put it mildly, inconsistent with the massive cuts package announced back home in the Comprehensive Spending Review. As Daniel Hannan complains, the UK's share of the extra money for the EU is £380m. Over a year, the MEP argues, that would pay for 6,020 NHS doctors, 12,670 nurses, 14,640 police constables and 22,330 army privates – good populist stuff, and persuasive too.

Watch, in coming months, for a move towards similar Europhobia on the Labour benches too. Many in the party were uncomfortable with Tony Blair's attempts during the late 1990s to forge a new relationship with Europe. Freed from the burdens of office, Labour MPs will scour far and wide, and low, for votes.

As for Nick Clegg, he is enjoying his forays into European capitals where he has been wooing his counterparts with his very unBritish linguistic ability and his affinity for European cultures. These attributes, along with his Dutch and Russian ancestry, set him apart, with the Daily Mail famously wondering during the general election "just how British" he is. Clegg's presence in the heart of government will temper any urge Cameron might have to buckle to his more virulent Eurosceptics in the months to come. But the Lib Dem leader also knows there are few votes to be gained in ardent Euro-enthusiasm.

Cameron has sought to justify the short-term compromise on the EU budget by saying Britain will hold firm during talks that will set the framework for the 2014-2020 settlement. He points out that Britain is not going it alone. Within minutes of intervening on Thursday, the PM had garnered support from 10 other leaders, crucially the French and Germans among them.

On conclusion of the summit, Cameron sought to reassure the doubters: "I'm not pretending that this is a giant El Dorado of a goldmine for the British public. What it is is a lot better than what we were looking at and, the key point is, it wouldn't have happened without our action".

His position is broadly in line with Major's during the early 1990s, a wary pragmatist who sought alliances where he could. Cameron knows that the two big players, Angela Merkel and Nicolas Sarkozy, do not get on and that the Franco-German alliance is fractious. It helps Cameron in Europe to be seen to be discussing military deals with the French and economic austerity with the Germans. For Merkel, however, the budgetary wrangles are but a sideshow. Far more crucial to the Germans, and to the future of the EU, is her insistence on rule changes that will make it harder for rich member states to be required to bail out the "poor and profligate" – code words for the Greeks, Portuguese and others.

Her insistence on changes to the Lisbon Treaty to enshrine new strictures has alarmed not just Cameron – who is committed to a referendum on any major constitutional reform – but also the Irish, Dutch and others who have all seen governments defeated in plebiscites on Europe.

The irony of Greece's riots in May was that while they gave cover for the UK Government to opt for the "pain first, gain later" approach to debt, the UK was almost completely irrelevant during the saga. This was an issue for the eurozone, led by a powerful but reluctant Germany.

This is the reality that the overblown rhetoric refuses to see. Britain has some clout, but it has always been exaggerated by Whitehall spin doctors for domestic consumption. Europeans remain wary of incoming prime ministers whom they see as obsessed with the hostile rhetoric of "red lines". Tony Blair's messianic military zeal in Iraq ensured that the UK "punched above its weight", to use that hackneyed phrase beloved of diplomats. It is pointed out in chancelleries across the continent with no little Schadenfreude, now that Britain has aircraft carriers without aircraft, it has lost even that unique selling point.

The hardest truth for the EU's leaders is that the continent is disappearing fast as an economic and political player. Europe is seen as a region of uncompetitive societies of high costs and an ingrained entitlement culture. Even if the bloc were led by figures of greater statute than Herman van Rompuy and Cathy Ashton, even if the Americans had a single phone number to dial, they probably wouldn't anyway. The US administration is fixated by China and India. That is where the real action is.

John Kampfner is author of 'Freedom for Sale' and 'Blair's Wars''; www.jkampfner.net