Late Wednesday night, despite intense lobbying by Mr. Cameron, a large faction of euro-skeptic Conservative rebels joined forces with members of the Labour Party to defeat a proposal backed by the prime minister on the European Union’s pending 1 trillion euro, or $1.3 trillion, budget.
Although Mr. Cameron wants Europe to exert budgetary discipline, his measure would have supported allowing European Union spending to increase at the rate of inflation over the seven-year life of the budget.
Labour has traditionally been pro-European Union. But Labour members of Parliament, along with the Conservative renegades, argue that at a time of deep public-sector cuts in Britain, accepting less than similar spending reductions by the European Union would be intolerable.
The vote on Wednesday night was nonbinding. But the political significance for Mr. Cameron, who will start budget talks with his 26 European Union partners at a summit meeting on Nov. 22 in Brussels, could not be more significant.
Having had to curb his party’s vehement anti-Europe sentiments in deference to his coalition government with the Liberal Democrats, the most pro-Union of all the major British parties, Mr. Cameron now is facing an outright rebellion in his party.
It is most likely all the more galling to him that Labour, already far ahead in public opinion polls, is stoking dissent to further weaken the prime minister.
Mr. Cameron has threatened to veto the proposed European budget, which would cover the period from 2014 to 2020, if the Union does not meet his demands to hold spending increases at or below the inflation rate.
Britain is one of the few European Union member countries that is a net contributor to its budget. Last year it paid in about £10 billion, or $16 billion, more than it received back in benefits. But Britain is hugely outnumbered by member countries that are net recipients and that are pressing for an increase in European Union spending even beyond the inflation rate.
Europe’s richest country, Germany, also is pressing for spending cuts, though not as much as Britain. And Chancellor Angela Merkel, who is deep in talks over how to keep the fragile euro zone in one piece, has little appetite for a nasty fight on the issue.
If Mr. Cameron were to return from Brussels with a budget in which spending was not cut, his political position could become all the more precarious.
He is almost certainly aware that his predecessors, Margaret Thatcher and John Major, both were fatally weakened because they could not unite their Conservative Party over Europe.
As many European leaders use the economic crisis to push for a more federal Europe, British popular opinion is pulling in the opposite direction.
The most concrete example is the rapidly rising popularity of the United Kingdom Independence Party, which advocates Britain’s outright exit from the European Union.
Led by the volatile and media savvy Nigel Farage, the Independence Party is now threatening to overtake the Liberal Democrats to become the third-largest party in Britain, after the Conservatives and Labour.
Article source: http://www.nytimes.com/2012/11/02/world/europe/british-leader-faces-fight-over-europe-budget.html?partner=rss&emc=rss