So Britain has isolated itself in Europe by refusing to sign up to a deal to save the eurozone because other countries refused to give the UK specific safeguards to protect the single market and the City of London. Tory backbenchers are delighted, but what does the pro-European Lib Dem half of the coalition make of it?
Anyone expecting a massive bust up at the heart of the coalition will have been dismayed to read Nick Clegg’s statement this morning. The deputy prime minister said:
The demands Britain made for safeguards, on which the Coalition Government was united, were modest and reasonable. They were safeguards for the single market, not just the UK.
What we sought to ensure was to maintain a level playing field in financial services and the single market as a whole. This would have retained the UK’s ability to take tougher, not looser, regulatory action to sort out our banking system.