British PM Defends Veto of EU Treaty Changes

Posted December 12th, 2011 at 5:25 pm (UTC-5)
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British Prime Minister David Cameron has defended his decision to block European Union treaty changes aimed at protecting the euro currency.

Mr. Cameron told the British parliament Monday that the EU deal, which other members plan to go forward with outside EU auspices, would have damaged Britain's key financial services industry. He said he went to the EU summit in Brussels Friday with one objective — to protect Britain's national interest.

The EU proposal would have required members to impose binding caps on spending and borrowing. Supporters, led by France and Germany, also wanted a unified corporate tax rate and a new financial transaction tax. But Britain, which does not use the euro, voiced concerns that the plan would undermine its sovereignty and diminish London's role as a dominant financial center.

Opposition Labor Party leader Ed Miliband accused Mr. Cameron of “isolating Britain, alienating its European partners and removing the country from important future discussion on European economic issues.” But he refused to say whether he would have accepted the EU treaty, or what he would have done to reach a better one.

Mr. Cameron's coalition partner, Deputy Prime Minister Nick Clegg of the Liberal Democrats, said Sunday he was “bitterly disappointed by the outcome of last week's summit, precisely because there is a real danger that over time Britain will be isolated and marginalized within the European Union.”

The EU plan is designed to ensure long-term stability. But analysts are concerned about the short term financial health of some member states, including Greece and Italy, who will need to borrow large sums of money early next year to finance their existing debts.