Accentuate the positive, Tony

Labour can woo business away from the Tory party over Europe, writes Denis MacShane
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My first memories of foreign affairs debates were of the Soviet Foreign Minister Andrei Gromyko exulting in his threat to use the veto in the United Nations. Mr Nyet, as he was then called, has now resurfaced in contemporary British politics in the shape of Malcolm Rifkind whose White Paper on the European Inter-Governmental Conference will be debated tonight in the House of Commons.

In between the natty little maps and colour charts the verb that leaps from page after page of Mr Rifkind's White Paper is "oppose". Britain's Foreign Secretary has become Europe's Mr Nyet, the great No-sayer, without any concrete proposals to put on the negotiating table but an infinite capacity for finding reasons why nothing should be done.

Mr Rifkind is practising what the French call une fuite en avance - hoping by running faster than his own troops to avoid the battle. It is not working with his own party. Ex-cabinet ministers such as Norman Lamont and John Redwood are obsessed by anti-Europeanism. The former cabinet minister, Jonathan Aitken, has used the W-word - withdrawal - when commenting on Mr Rifkind's White Paper in the Commons.

The anti-Europeans are now the most vocal force in the Tory Party. They have developed a powerful new theory and practice based on protecting British sovereignty and our political institutions from European influence.

But the trouble with political protectionism is that it leads ineluctably to economic protectionism. From a continental perspective, the devaluation of the pound and UK government policies aimed at lowering wages and social rights amount to an unfair export-subsidy for goods made in Britain. In France, Jacques Calvet, the influential head of Peugeot, speaks openly of protecting the French market from such unfair competition. The German government, fed up with Britain's veto of a European directive covering foreign workers anywhere in Europe, now says the Auf Wiedersehen Pet building workers from England must abide by national rules on wages and social protection, a measure aimed at helping German construction firms and German bricklayers.

Labour has come rather late in the 20th century to an understanding of the need for outward-looking economics and politics. The globalised economy requires co-operation and pooling of power and policies not a retreat into nationalism and protectionism.

The great prize for Labour in British politics lies in the opportunity to detach a sizeable chunk of British business from its century-long adherence to the Conservatives. All our exporting firms, including companies such as Nissan, British Steel, BT and British Aerospace, as well as our banks and our insurance companies, which are well placed to compete in Europe, need ministers who can offer a positive agenda on Europe. These firms will also need the European Court of Justice - the new target for the Prime Minister - to break down cartels and secure access for British goods and services in the national markets of Europe. Pandering to nationalist Tory protectionism and saying "No, No, No" is bad news for British business.

Between the nationalists of the Tory right and the dwindling group of out-and-out federalists, Tony Blair and Robin Cook are shaping a patriotic Europeanism that has ancient roots. Britain has always done best when it has been present in Europe, either directly in alliances, concerts, or unions. Isolation from Europe, the Conservative politics of the Thirties, was a disaster for Britain.

Blair and Cook have repositioned Labour as the British party that can best treat with our European partners. And component elements of the new Labour Party, including local councillors, trade unions and opinion-formers in the universities, are now at ease over engagement in Europe.

If a positive agenda for Europe is shaped - along the lines of what the French politician Philippe Seguin recently called "a federation of nation-states" - then Labour will not only serve British interests. It may see a sundering of the Conservative Party into its national-xenophobic and its democratic-capitalist grouping and open the way to a long period of Labour hegemony in British politics.

Denis MacShane is Labour MP for Rotherham.

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