LEADING ARTICLE : Michael Portillo's shabby patriotism

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Last winter it looked as though this week's Tory conference would be riven from top to toe with bloody dissension over Europe. The expelled Euro-rebels were screaming for the Cabinet to rule out ever joining a single currency and pro-Europeans were warning of the dangers of exclusion from the mainstream European debate.

Yesterday, across Blackpool, the shrill hysteria of the Euro-sceptics had gone. Their passion has ebbed - not because they are reconciled to elements of the European project, but because they no longer regard it as an immediate threat. As Norman Lamont revealed in his contribution to the fringe, the nationalists think they are winning the argument. "We are all Euro-sceptics now," he boasted.

And in many ways he is right. What has changed is not the Conservative Party, but the rest of Europe. In the summer the German Finance Minister, Theo Waigel, raised doubts about the ability of several countries to meet the Maastricht criteria. Meanwhile the French President, Jaques Chirac, faces serious obstacles to his policy of shadowing the mark. In these circumstances any move towards greater monetary integration in the near future looks unlikely. The Euro-sceptics thus feel less threatened. The idealistic Euro-enthusiasts are slightly chastened, and - for the moment - the moderate pro-European politicians feel that they can afford to indulge the right wing.

Public attention is shifting to the internal argument over economic priorities; to tax cuts versus public spending. The sound and fury centres on the question of who - if anybody - should pay the price for Tory ambitions to give the middle classes a pre-election bonus. Difficult though this ground is, its lack of any absolute focus renders it much easier for the Tory high command to deal with - and find some accommodation between the different wings over - than Europe.

The only problem is that some senior Tories are not prepared to sign up to a ceasefire on Europe. Yesterday the Defence Secretary, Michael Portillo, made it clear that a consensus on Europe is not attractive to him. With no economic union to rail against, Mr Portillo acquired a new enemy: European defence co-operation. After spuriously invoking the dead of two world wars, Mr Portillo constructed a new Aunt Sally - a European superstate giving orders (presumably barked in comic German) to British soldiers. "No way," he yelled to predictable applause.

In his single-minded pursuit of the longest standing ovation of the conference, Mr Portillo was jeopardising the one area where far greater European co- operation is urgently needed. As events in Bosnia have demonstrated, the Americans are increasingly reluctant to intervene in foreign crises, and the lack of any properly co-ordinated European action has been sadly evident. We can and must do better if we are to deal with the complex geopolitics of the next century, when the unilateral efforts of small nations will become increasingly irrelevant or counterproductive.

Mr Portillo is happy to build his alternative political base in the party, exploiting any opportunity he can to use the European issue. That is not a surprise. What is less clear is what the Prime Minister will do about it. If the answer is "nothing", then his willingness to pander to ultra-nationalism may rebound on him. Meanwhile those on the left of the party, already aroused by Alan Howarth's decision to quit, will feel even more uncomfortable in the face of Mr Portillo's crude populism.