18/11/2011 Newsnight


With Gavin Esler. David Cameron and Angela Merkel have acknowledged they have differences over the eurozone crisis. Can they overcome them?

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Welcome to Europe in need, please put your hands in your pockets to


help pay off the eurozone's debts. The subject discussed by David


Cameron and Angela Merkel today. But is there, at last, any glimmer


of a common solution to the problem which could sink us all? My German


isn't that good, I think bazooka is a superwafer, no, someone is


shaking their head. We will discuss what it means with Conservative MP,


Daniel Hannan, German banker, Schmieding, and the journalist,


Bronwen Maddox. Sepp Blatter says sorry for suggesting racism could


be settled with a handshake. The former England player, Sol Campbell


is here to discuss, racism, bigotry and the football leadership. Two


British nationals killed in Pakistan, by an American drone


strike. How many British volunteers are fighting for Al-Qaeda?


Good evening, eurozone leaders aren't as cuddly as Pudsey, but


they are looking for every euroor - - Uri owe pound you can spare.


Someone will have to stump up. The leader of the biggest economy


inside the eurozone, Germany, and the biggest economy outside the


eurozone, Britain, met today to try to figure out, what short of an


appeal for worldwide loose change, could solve our problems. They were


more fluent in decribing the problems than fixing them.


OK, you're British, you're in Germany for a crucial meeting, what


is the subject you want to avoid? My German isn't that good, bazooka


is a superwafer, no, someone is shake their head. The German for


bazooka is "tank terror", which is possibly not where you want to go


in a vital press conference. But, unfortunately, Europe's financial


Baz Zach ka, and its fail -- bazooka, and its failure to fire,


is the subject between Britain and Germany. TRANSLATION: As to the


question of what choifs weapons are used to deal with financial markets,


I believe credibility is gained by using the force and strength you


have. The British say we have to use all the force available, I


think that is right. But one should not pretend to be more powerful


than one actually is. At Brussels, in October, Mrs Measuring mrbg on


agreement on the booze zook -- Mrs Merkel won agreed on the bazooka, a


one trillion bailout from the EFSF fired from Germany. It went wrong


at Cannes, no-one would lend the money. Mr Cameron began pushing for


the European Central Bank to lend the money, firing its own bazooka,


but it won't. In the meantime, the Governments of Italy and Greece


fell. And today, the boss of the European Central Bank said that he


would not be firing the bazooka any time soon. We are four weeks after


the summit that agreed on the leverageing of resources by factor


of up to four or five, that declared the EFSF would be fully


operational and all the tools would be used in an effective way to


ensure financial stability in the euro area. Where is the


implementation of these long- standing decisions? Which


translates as, you fire your own bazooka! Germany knows saving the


euro is vital to its own survival as a manufacturing and export giant.


But its workers believe prosperity and stability come from low


inflation and a credible Central Bank. So using the ECB to save the


euro, is, for Mrs Merkel, politically impossible. I think if


Merkel agrees to involve the ECB, which is against the EU treaty, by


the way, she will go through a vote of confidence and she will lose it,


and the Government will break down. Instead, the Germans are


concentrating on a long-term plan. The German position was outlined in


a document from the German Foreign Office, leaked to the Telegraph. It


calls for political union, a stability commissioner with power


to intervene in national budgets, and the power to impose orderly


default and exit on eurozone members. The problem s that needs a


treaty change, and as the Mercedes deposited Mr Cameron in Berlin, it


is clear the Germans are determined to do it with or without us.


German position is, we would like to keep the British in, we would


rather do the new treaty with all 27, it is simple letter and easier,


however, if the British are going to be -- simpler and easier,


however if the British are going to be demanding on powers coming back,


then we will go along with a eurozone treaty with a few hours


who want to join the eurozone. There is diverge begins between


Paris and Berlin I I have -- deverence between Paris and Berlin.


But I have no doubt if the British block the treaty, the Germans will


go ahead with something that doesn't include the British. It is


not whether Britain is in or out of the group that writes the treaty,


the problem is time, the Germans are determined to find a strategic


solution, the markets need an immediate solution. In the end, it


comes down a clash between two implacable forces, the bond market,


and the German electorate. That has left David Cameron struggling to


contain his frustration, and even some German commentators are


prepared to accept there is a timing issue. She said today in


Berlin, "step by step", while the British Prime Minister is talking


about a bazooka, it is a crisis, as you say, markets move in seconds.


You have to take the decisions now, you can't wait. In this sense,


calling Mrs Merkel Madame Dithering is quite the right term. It is not


changed, she is getting a bit more quick in her decision, she's still


very slow. Having that in mind, Germany is the decisive and crucial


player in this game, you could call it a bit scary, yeah.


It was Mr Cameron who wanted this meeting, diplomatically he came


away with a smile and a handshake, for all his talk of a bazooka, it


is Germany that le l decide if and when it gets fired -- will decide


if and when it gets fired. Have German relations improved, with us


is Holger Schmieding from the Berenberg Bank, and Bronwen Maddox


and Daniel Hannan, the Conservative Are Britain and Germany any closer


tonight as a result of the meetings? At least to what we have


heard about the meetings, they probably have not moved much closer,


no. They are far apart on major issues. The German conclusion from


the eurozone crisis that we need more Europe, the British conclusion


seems to be we need to move a bit further apart from the eurozone. So


that is a significant clash, and as to technical details, financial


markets, transaction tax, they don't seem to agree. Do you accept


that analysis, that in other words, there are the smaller things like


the financial transaction tax, sometimes called the Tobin tax, but


on the big picture they are miles apart? I think that is right. I


thought it was a fabulously disingenious speech by David


Cameron. He rightly said Europe's problems could be sorted by


pledging enormous amounts of money, and he doesn't want Britain to do


that, he wants the Germans to do it. And the Germans are threatening


saying if you don't join if we might come at the City of London


with transaction tax. Why do you think the British and Germans are


so far apart on this, where as on some big picture matters like


competitiveness and fiscal discipline, you know, not rewarding


bad behaviour, moral hazarz, philosophically, they should be a


lot closer, shouldn't they? If it weren't for the wretched EU we


would be getting on famously, they are the country with whom we have


most in common in continental Europe. It is not for us to decide


how the eurozone settles its problems. If they were to ask my


advice, I would say allow countries to leave, allow each country to


suit its monetary policy to its own need, allow the Mediterranean


states to price their way back into the market. I'm not a Greek, German


or Austrian or Finnish legislator, if they have made the decision to


keep the euro together, at whatever cost, that is matter for them. What


I kind extraordinary is Britain is not only investing political


capital in proposing this idea, but actual capital. We are on the hook


so far for �12.5 billion in the Irish, Greek and Portuguese


bailouts, that is before you get to Italy. Is that a problem for


Germany, to go back to the start of what Hannan was suggesting there,


that actually, on many issues fissofically, should be much closer


to Britain, and if it wasn't, -- philosophically, should be much


closer to Britain, and if it wasn't for the EU, links with Greece and


Italy, there wouldn't be the problems? The problem is Britain


has refused to actually join in. The Germans would love the British


in, more involved in Europe, ideally within the eurozone, at


least that was the original German idea, so that within the European


institutions the kind of philosophical similarities between


Britain and Germany, more competitiveness, would gain the


upper hand. But Britain has decided to stay some what aloof. Could I


suggest you are as likely to get as -- that as likely as Hannan is to


get the renegotiation of the treaties? The treaties are to be


renegotiated, and there is a solution to the German and British


difficulty, namely that Britain agrees to pass an amendment to the


EU treaties that allows Germany and France and the other 15 countries


to move closer together, and in return Germany and France will


allow Britain to have a few more opt-outs. Would that be good enough


for you, what do you want on that? Ultimately it shouldn't be for me


to decide, or for you to decide, or even Angela Merkel and David


Cameron to decide, it should be more the electorate as a whole to


decide. Ultimately whatever renegotiation comes out will need


be put to the country with a "no" vote treated as a vote to leave the


EU. That is the only guarantee. Something I would like is something


along the lines of the Swiss, you are in the free market but you have


opted out of the political structures that go with it. You are


affected by it, because it is so big, we would be affected by it, we


wouldn't have a voice in it, like the Swiss? Well, they seem to be


scraping by some kind of miserable half existence out there, ditto the


Norwegians. Of course we would lose influence over the internal affairs


of the countries in the tighter union. That is unquestionably the


case, just as we have no internal influence over the affairs of Japan,


Singapore, or the Congo. That is the price you pay. But as long as


you are in a free market, within the EFTA terms and the WTO terms,


that is what most people in the country would vote for, that is


what we thought we were voting for in 1975. This is fascinating, we


have these two countries, we have accepted there is a degree of


philosophical agreement, these two questions are completely totally


poles apart? They are completely different. I think there is a


philosophical difference between Germany and Britain on views of


Europe. Then there is the very sharp difference that we began this


discussion with about who will pay for this, that is really the first


one. At heart I think this is rather a brutal clash about money.


But then the philosophy comes after. That it is dangerous game for


Germany and France to push Britain to the point where Cameron's


yooptics begin to say let's take Britain right out. -- Euro-sceptics


begin to say let as take Britain out. In Germany do you feel you


have to be anchored into it, and you can't do what the European


Central Bank does. Mario Draghi, not just the British, is suggestk a


real lack of leadership and you have -- suggesting a real lack of


leadership and you have to get your act together, you meaning Germany?


Going back to the debt crisis, the big difference between the eurozone


and Britain is Britain has a Central Bank which helps the


Government pay its debts, massively, where as the European Central Bank


is refusing that. If the European Central Bank were to behave like


the Bank of England, the eurozone debt crisis would probably be over


in a second. So, indeed, there is a philosophical difference in how you


treat your Central Bank, and how your Central Bank is viewed.


there, for the other part of that, which we heard in Paul Mason's


report, is there something about the German character, or the


political system, which means Angela Merkel cannot be as decisive


as people want her to be on this? She has to take a significant part


of her voters with her, on all the major things. That indeed means she


can't move very far. She cannot, for instance, just endorse the ECB


buying loads of Government bonds, without having some backing, some


where else in the country. My view remains, if worst comes to worst,


and we may be there within a few weeks, the European Central Bank


will intervene massively. Angela Merkel will probably back them, but,


then we will have a little uproar in Germany, still the thing will be


settled. Do you share that view, that is the likeliest thing that


will happen, in other words, we will muddle through and there will


be a lot of mudling, and not much through? I think it is the


likeliest thing, I don't think it is the right thing to do. I'm not


fan of quanative easing in this country, inflation is a way of


punishing people who have done the right thing, and I wouldn't wish it


to allies in the continent. I think it is not right to impoverish


people which the project means, it is better if the countries were


able to suit their economies to their needs, and very soon the


problems would be over. But the elites of Europe are sacrificing


the prosperity of their people for this European dream. Do you think


David Cameron's voice in Europe is any stronger than it was this


morning, or the opposite? I think it is stronger than it seems. There


is all this talk of Britain on the side lines, but Germany and France


do want Britain to play a part in this. That is what today's press


conference and the jokes were about. Trying to make sure that Britain


helps out. With money as well as anything else. The likelihood of


that, the implication of everything we have been discussing is it is


not going to happen, in which case. It won't happen unless we get much


closer to a crisis. On that narrow point about David Cameron's


influence, or the UK's influence, now and in the future? The British


influence on events in the continent is extremely small, to


put it mildly. I don't think it is the eurozone asking Britain for


money, what the eurozone is simply asking, dear Britain, we in the


eurozone want to forge a closer European, for that we have to


change the EU treaty, and please, dear Britain, ratify the new EU


treaties which will help us in the eurozone to integrate in the way we


want. Which is saying, Britain please don't get in the way. But,


do you think Britain speaks absolutely with one voice on this,


Nick Clegg, a coalition, he has a slightly different view and


attitude and has been commenting on this today? But that's the case in


every country. You have different opinions, in Britain you have


interesting clashes between Euro- sceptics and some remaining sort of


Europhiles, but that is normal politics. This was making it sound


as if we have months and months to sort this out, to redraw the


constitution. There is a crisis between where we are now, and the


kind of constitutional redrawing that you are decribing. In that


crisis it seems to me they do need Britain. The two points is the


immediate crisis is ultimately for the European Central Bank to solve.


The long-term issues are then for the new EU, rewritten EU treaties.


Thank you very much all of you. The European Union is not the only


international organisation having difficulties, FIFA President, Sepp


Blatter, seems to have moved seemlessly into the role recently


vacated by Silvio Berlusconi, managing to say some of the


stupidist things on world stage. He seems to have been suggesting that


racism issues can be solved by handshake on the pitch. Is it going


way? A man who used to be President of


the Society of Friends of Suspenders, might not adapt to 21st


century customs, after advising female players to wear tighter


shorts to get more attention. And telling gay fans going to Qatar, to


avoid having sex, the latest Blatter blunder was offensive in a


different way. There is no racism, there is maybe one of the players


to another, he has a word or gesture, which is not the correct


one. Also the one who is affected by that, he should say it is a game,


we are in the game, and at the end of the game we shake hands, this


can happen. Blatter's comments followed allegations by the


Manchester United player, Patrice Evra, that he had been racially


abused by Liverpool's Luis Suarez. The Uraguayan has been charged by


the FA. With similar claims against John Terry still are under


investigation. The timing could be more sensitive. Today there was an


attempt to calm the storm. sorry, I regret that my statements


earlier this week have resulted in an unfortunate situation, very much.


Assuming Mr Blatter does not return to the presidency of Friends of


Suspenders, he might be sticking to his script a little more in future.


Here to react to all of that is the former England, Arsenal and Spurs


footballer. It was a pretty groveling apology, it looked


prepared, is that enough? For me it doesn't wash. For the head of FIFA


to come out with something like that, for me it is shocking. It is


astonishing. I'm astonished he's still in the job. In any other


industry, if the head of the company comes up with those kind of


comments, he's sacked, he's gone in a few days time. For me it really


shows FIFA, how they are as a body. The comments he came out with, the


ramifications of what he said, you know, it filters down into grass


roots football. Little kids playing football, Sunday league, you can


say whatever you want, be racist to another opponent and then after the


game shake the hand and it is all over. That is not right. Just to be


clear, you think he should resign, and if he shouldn't resign he


should be kicked out? I think he should step down and do the


honourable thing. When things happen on the pitch, sometimes


people do stupid things in the heat of the moment, is that any excuse,


if that happens on the pitch between players? Yeah, every single


time something happens, the heat of the moment, you keep on, are you


allowed to racially abuse someone in the heat of the moment? No. If


that is the first thing that comes into your mind, not at all, no.


do you get round that, there is different types of racial abuse,


when you move from Tottenham to Arsenal, you suffered quite a lot


of chanting, and abuse. Is it different when it comes from the


fans or when it comes on the pitch from another person doing the same?


I think from another player is definitely even more hurtful, it is


sickening, it is disgusting. So for him to say you can just wash it off


with the shake of a hand, for me it is unbelievable. I can't believe


no-one has really picked this up, Government wise, sponsors-wise, how


can you have the head of the body of football of the world, saying


those comments. If he has said those comments, people are saying


it is OK, he has said sorry, for me that is unbelievable. Are we in


Britain, and the English game in particular, are we a bit different


from the rest of the world. You know the reputation of Russia and


Eastern Europe, sometimes in these matters it is not entirely pure, is


it? Some of those countries have big problems it's the head, he


should know better. He has compromised FIFA, big time. For me,


the longer he actually stays at FIFA, I honestly think FIFA will


become weaker. Does it have an effect, you suggested before, does


it really have an effect on the grass roots of the game, 10, 11-


year-olds? Yeah, I think kids are listening, Sunday league football,


people like that. If you realise what he says,'s the head, all that


seeps down, and you know, all these other games aren't policed properly


you can get away with a lot of things in and around those kind of


levels. If you hear the top guy saying, you can do whatever you


want, be racist to player, it is a part of the game, as long as you


say sorry afterwards, it is OK. Where are we going in football? For


me he has flung football 40 years back. All the hard work, all the


campaigners, Kick It Out, Show the Red Card, all their work for


nothing. We don't know exactly what happened in the John Terry incident


or the Suarez incident, we know they are being investigated. Do you


think things have changed a lot in the game in this country at los?


Most certainly. Are things a lot better? Yeah. Since the early 190s?


I watched football before that, and heard all the comments and the past


players talking about their experiences through the 1960s and


1970s. Yeah it has definitely moved on. It is only because there is


some people doing fantastic things up and down the country and


campaigning to kick this out. It is only because of the hard work and


the PFA, and the Football Association, and players, and the


wider public, the English public have come together to nulify T it


is not completely depon, but it is -- it has not completely gone, but


it is better than the 70s for sure. We know the view of most people in


England about what has happened over the World Cup and allegations


of corruption and so on. Nobody seems to care what the British


think? Do they in this? The trouble is, England across the water


haven't the best reputation when it comes to talking to the other


nations when it comes to football. I don't know why, I think they have


to get the right man, FA side, to start talking to them and bring


them closer. Thank you very much. We have long known that British


nationals are fighting for the Taliban, and Al-Qaeda, in


Afghanistan and Pakistan. There were persistent rumours of fighters


with Birmingham accents and a copes was found with an Aston Villa tatoo.


Today was revealed two British men were killed in drone strikes. One


left Britain subject to a control order in 2007. What more do you


know about this? Interesting, the first man, Ibrahim Adam, 24 years


old from East London. He was on a control order, as you say, along


with his brother, they both absconded on control orders. That


is two brothers in that family. A third brother, their older brother,


was called Anthony Garcia, he changed his name, this third


brother was convicted of terrorism offences in 2007, connected to the


operation about the crevice fertiliser bomb plot. We have three


brothers closely linked to terrorist activities there. The


second man named and killed in a drone attack, is Mohammed Azmer


Khan, originally from Sheffield and then in London. He's said to be a


brother of a man, Azmeil Abjar, killed last year in a drone attack


in Pakistan. Do we have any more idea about how many similar case


there is might be? There is a steady flow of young radicalised


Muslim recruits from Great Britain into the north frontier province,


the tribal areas, over a number of years. We have just late last year


spoken to a family from Manchester, whose son, Umar Arshad, left the


country, again, on the control order, they were deeply worried


about him. We can hear from them now. He didn't seem well or himself.


This happened very suddenly. It wasn't a space of you know a year


or two years, it occurred within a month. His mind was being changed,


because of the way he was being ruled by these individuals, or the


gang. If they told him to sit down, he would sit down. If they stold


told him to stand up, he would stand up. We could see how worried


the brother and the father were there. I have spoken to the family


today, there is no news where their relative is in Pakistan it's widely


believed to have disappeared into Pakistan to be recruited by Jihadi


groups, possibly linked to Al-Qaeda. I think this demonstrates that some


families in Britain phrasing this awful prospect of lose -- facing


this awful prospect of losing their young ones to Islamic Jihadists.


young ones to Islamic Jihadists. The front pages now.


The Times has 50% off council houses and also the story of the


Natalie Wood case, waking the dead, LA police reopen the case. The FT


has financial stories, the Northern Rock funds deal. The ECB hitting


back over intervention calls and a picture of Angela Merkel and David


Cameron translating each other's thoughts, I suspect. The Mirror has


ITV Daybreak dream team sacked, Adrian Chidldes and his pardon --


That's all from Newsnight tonight, Mark Kermode will present the


review show in a minute. We will leave you with the news that one


half of the Cosgrove Hall duo has died. The list of his cartoons goes


on for a very long time. Here is a # He's the greatest


# He's fantastic # Wherever there is danger