ISOLATED IN THE ARMS OF THE WORLD'S ONLY HYPERPOWER:

The Pernicious Rise Of "Core Europe": Germany and France are building a bloc to preserve their influence (John Rossant, 5/10-/04, Business Week)

This is not the expanded Europe of 25 nations, which comes into being on May 1, when 10 new members join the European Union. No, this is a narrower region revolving around France and Germany, with Spain, the Benelux countries, and perhaps eventually Italy playing supporting roles. Core Europe stands distinct from the pro-American British, with their free-market notions, and the poor relations just arriving from Central Europe.

Core Europe's precepts? First, a kind of protectionism lite, which promotes national champions and, when necessary, uses market methods to advance its dirigiste goals. (Paris, after all, encouraged Sanofi to pay big bucks to Aventis investors.) The other traits: a determination to keep U.S. influence at bay and bend EU rules to promote the interests of the core, even at the expense of the periphery. Witness how France and Germany got away with breaching rules on budget deficits last November. Or how Chirac and German Chancellor Gerhard Schröder have coddled Russian President Vladimir V. Putin -- despite the European Commission's more critical stance on Russia.

Chirac and Schröder feel the wind in their sails, especially after the Madrid bombings, which led to a Socialist electoral victory two days later -- and to a 180-degree shift of policy in Madrid toward France and Germany and away from Britain and the U.S. Almost overnight, France and Germany won new clout in the fight for Europe's future. They are now likely to get an agreement on an EU constitutional treaty.

This shift in the political dynamic is rapidly isolating British Prime Minister Tony Blair, who has had to give in to calls from skeptical Britons for a referendum on a new European constitution. A no vote -- which polls predict -- would distance Britain further from the rest of the EU. With Britain sidelined and Spain backing France, says BP PLC (BP ) Chairman Peter D. Sutherland, "we're again back to the idea of Core Europe."

Britain isn't European--it's at the core of the Anglosphere.

Posted by Orrin Judd at May 6, 2004 6:14 PM