The secret that Blair and Major share

The party leaders broadly agree on European integration. Is this really too dangerous to admit?

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Tin hats on, everybody. A phoney war is starting. Hunker down, gas masks at the ready. Eeeoww! Kerrrash! Europhobe attack on Euro-maniac bunker. Dakka-dakka-dakka! Sir Jimmy Goldsmith takes out federalist panzer division in City. Whurrr-thump! EMU heavy artillery counter-attack near Shepherd's Bush.

And a nation looks on, bewildered.

Goldsmith's UK Referendum Party is mobilising. John Redwood is organising a campaign to persuade British business that a single currency would be a disaster. The Conservative Party is preparing an onslaught against Labour on its federalist agenda. Labour is gearing up to attack the Tories for selling out British interests in Europe. Everywhere people are accusing one another of treason and - worse still - naivety.

Yet on all the main questions, Labour agrees with the Government. And the noisiest anti-Maastricht rebels have probably already won their main points. This is a phoney war because there isn't nearly enough disagreement left to justify the verbal violence being expended on it.

Tony Blair made a speech last Thursday which, in its European passages, could have been given by Malcolm Rifkind, John Major or Kenneth Clarke. He proposed three priorities for the European agenda. First was the speeding- up of negotiations on enlargement. Second was reform of the Common Agricultural Policy. Third was the need to achieve stronger economic growth through more open competition and a tougher approach to unfair state subsidies.

Blair's analysis could hardly be distinguished from those Tory ministers: ''Maastricht showed that elites and the people had become too far separated. The Union is now at a more mature stage. Increasingly, integration will happen by a process of organic growth, where progress is more and more in the hands of businessmen, consumers and ordinary people ...''

On the single currency, Blair restated the Labour position that ''it cannot be forced in defiance of the economic facts'.' But he went further, saying ''it is a major step of integration, not to be taken lightly'.' Back in March in the Commons, he had argued unequivocally that ''if the economic conditions were right'' he would be in favour of joining. He dismissed the political objections and the constitutional fears.

Finally, like Major, Blair has left open the question of whether he should promise a referendum. I get the impression that this is being considered by Labour. Both parties are watching the other almost obsessively, thinking like poker players, guessing when to move.

So they now have identical European policies? No. Not quite. Labour is in favour of an extension of qualified majority voting on social, industrial and environmental policies. That matters. There's the social chapter, which matters too. There are differences on anti-racist policies. In office, Labour would be more interested in the social and unemployment agendas than the Conservatives are. The tone would be far less nationalistic. None of this is insignificant.

But when it comes to the really big issues - federal destiny or Europe of nations? - yes or no to the single currency? - how much does enlargement matter? - Labour and the Conservatives are now astonishingly close. Labour has recoiled from the more extreme manifestations of its conversion to Europe in the Eighties, while the Cabinet has kept the more extreme anti- Brussels Tories from winning any final victories.

So they have converged towards a position which assumes that federalism is waning, and aspires to wane it some more. They are right. Enlargement means that it will become progressively harder for the Commission to exercise the kind of control it has become used to, because the two basics of Europeanism, security and money (or fear and greed), will operate very differently in future.

Security, or fear, was the fundamental reason for European integration in the first place. Now it is the fundamental reason for pushing the Union to the East. But whereas security in the Cold War era was compatible with a tight, centrally organised Western European bloc, it now requires a larger, more diverse and hence less bureaucratically controllable Europe.

Money, or greed, will operate differently, too. The old Europe may have been designed by political idealists, but it was built by subsidy. Yet now, if German taxpayers are asked to subsidise central Europe as well as southern Europe, they will simply revolt. The payments for Mediterranean motorways and olive farmers cannot be replicated for Slovene conference centres or Polish raspberry farms.

Nor will a single currency provide the new political magnetism. Any hard core of single-currency countries will be surrounded by a wide circle of competitive devaluers: that will not do very much for the European spirit.

Those simple assumptions about the new Europe are more understood here than on the Continent. They underpinned Tony Blair's speech. But the politician who has been most eloquent and compelling about them is John Major. Party politics dictates that both these men will try to persuade the country that the other is deluded - that there lies a huge gap of belief and analysis between them. And it just isn't true.

The Conservatives will libel Labour as a dangerously federalist party, happy to go along with whatever Franco-Germania requires. It ain't. Labour will pretend that the most anti-European language of the Tory right is representative of the central thrust of government policy. That ain't, either.

Much synthetic indignation will be expended. Yet in fact the most substantial difference between them is more about party management. When the Conservatives say that Blair has ruthlessly moved his party to positions that they held out first, they are quite right. When he retorts that the Tory divisions have dangerously hampered the effectiveness of Britain in Europe, that's true, too.

But it doesn't really matter - not compared with the fundamental agreement about the state of Europe and the best future for it, a consensus that is being, in effect, hidden from the electorate. In a country with a different electoral and political system, it might be something we were rather proud of.

Not here. Here, we're ashamed of it. And the situation will be further complicated and hidden by the activities of the anti-Maastricht right- wingers trying to scare us into believing that monetary union is an imminent problem. Goldsmith and all imply that there is a great anti-democratic conspiracy that will steal away our pound.

Yet from Neil Kinnock in Brussels to Thatcherites in the City, from Paris to the Bundesbank, the likelihood of Europe making it by 1999 is waning. Nor, more importantly, does it seem credible that any government here would abolish the pound without either a referendum or a further general election campaign devoted to the issue. It would be too big a risk.

So we are in this extraordinary, perverse situation, where the main parties share a more level-headed and realistic assessment of Britain's future in Europe than they are willing to admit, while on the fringes of politics, wild shrieks of obsolete warning are rending the air. We are used to politicians hiding bad news. It is a shock to find them hiding quite good news. Political columnists are employed to rouse the reader to worry or alarm. But on this issue, the more the smoke and noise, the more I dream of emulating Lord Whitehall and going round stirring up apathy.

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