Echoing Chancellor George Osborne's remarks at last week's Tory conference, Cameron seems to be implicitly calling for the EFSF, the eurozone's bailout fund, to be topped up to around €2tr - widely considered to be the amount needed to backstop Spain and Italy.
Yes, from a purely economic and financial point of view, Cameron's remarks make sense, as do his calls for banks (French in particular) to be strengthened. However, there are two problems with Cameron's comments. First, democracy. Secondly, financial contribution.
In the interview Cameron says that
"In a time of crisis you have to do the right thing in order to deliver what I think - German politicians and Germany really wants, which is a working eurozone."Hmmm, isn't this precisely the type of rhetoric that was employed by EU leaders during the debates on the Lisbon Treaty, which Cameron and the rest of the Tory Party consistently criticised for failing to tune in to voters. We're thinking of the two referenda on the Lisbon Treaty in Ireland for example - the common theme being, 'voters don't actually really understand what they want or have voted for so let's have them vote again.'
So, if you follow Cameron's remarks to their logical extension, although virtually all the polls show that German, Dutch and Finnish voters are dead against a top up of the EFSF, what these countries really want is a working eurozone, so such poll results should basically be ignored. Irrespective of the economic merits of his arguments, it's hard to see how the UK government could credibly lecture others on the EU's 'democratic deficit' ever again.
A similar line was touted by an FT leader today, which similarly argued for the EFSF to be boosted but added more or less as an afterthought that:
"Above all, leaders must create the political conditions for good policy. Monetary union can only survive if each of its members wants it to: without voter support Europe will fail."What exactly does this mean? The article seems to imply that the EFSF needs to be topped up to a couple of trillion, but that, at the same time, without the support of citizens "Europe will fail".
We're having problems squaring that circle.
And if Cameron really thinks that a boosted EFSF would solve the eurozone crisis, with a corresponding positive impact on the UK economy (it may or may not, but that's besides the point for this particular discussion), why should Britain not contribute. It may be their currency, but it's Cameron's banks and recovery, so why not cough up, say, through a financial transaction tax?
The point here isn't that it's wrong to argue in favour of these measures. But we need to be completely honest about the basic tension at the heart of the eurozone crisis: giving markets what they want, invariably means running over voters.
EU leaders may get away with that at the polling booths. But then again, they may not.