The British government has dangerously miscalculated by walking away from the discussions on the future of the euro with the other 26 members of the European Union. Britain now finds itself in a minority of one in the EU, and has been shut out of the important talks with which the others are going ahead.
Prime Minister David Cameron's refusal to allow existing European institutions to be used for these plans shocked Britain's partners since his attempt to veto the plan reversed his previous position under which he supported the existence of the euro. He had been helpful in dealing with its problems although he remained firm that Britain would not join the euro.
During a dramatic Friday dinner attended by all the 27 members of the European Union, Cameron lost the confidence of his partners. When it became clear to the others that his demands for relaxed legislation for London's bankers were essential to him, they rejected his proposal.
Germany and France straightaway proposed continuing plans to rescue the euro at an inter-governmental level. They were supported by the other 15 countries in the Eurozone, and within 10 minutes they were joined by all other EU members, leaving Cameron with nothing to say and no forum in which to say it anyway. He got up and left the room.
US Treasury Secretary Timothy Geithner has been touring Europe to emphasise American support for the euro, and to reassure the Europeans that the Obama administration wants the euro to succeed. It was a damning indication of Cameron's future irrelevance that on this crucial trip Geithner visited Frankfurt, Berlin, Paris, Marseille and Milan, but did not feel that he needed to include London in his itinerary.
The Americans only want to talk to people who can make a difference.
