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Davis: Britain's Place in the World

Speech to Chatham House

"It is a great pleasure to be able to address this distinguished audience. The name of Chatham House is, itself, a reminder that Britain has been a power with global interests for two and a half centuries.

Palmerston, another national colossus, once described this country's interests as "eternal". And, of course, at the most fundamental level they are.

We must be able to defend our land and our people. We must ensure unhindered access to our supplies and our markets. We must keep strong alliances in Europe, America and other like-minded nations.

By and large, these geopolitical considerations do not change. But beyond them, almost everything else does - and has.

Britain today faces threats which our predecessors, even twenty years ago, could barely have imagined.

The most obvious and least forgettable is, of course, the threat of international terrorism. Never before has it been so easy for distant enemies of Britain to target our cities with murder and mayhem, while enjoying relative impunity from conventional defence.

But there are other threats too.

The proliferation of weapons of mass destruction, the threats to secure supplies of energy, the growth of drug- and people-trafficking, the spread of trans-national disease, the consequences of climate change - all raise capital question marks over the future.

Last, but certainly not least, the West in general and European nations in particular are confronted by competition from Asia, whose implications go far beyond the economic sphere.

Faced with challenges on this scale, it is possible to fall into either of two man-traps.

On the one hand, there is the comforting option of "business as usual", which pretends that every change is one of degree not kind, and that old mind-sets and existing arrangements can cope. On matters of security, the horrors of 9/11 in New York, reinforced by the tragedy of 7/7 in London, have largely shattered such complacency.

But there is still plenty of wishful thinking in evidence on other global matters - about the economic giants that are rising in the East, about the pressures of future migration, and about the need to resolve today's debate about Europe's future.

The equally culpable opposite to "business as usual" is the descent from complacency into incoherence, grasping at ill-thought-out initiatives, playing to different galleries, failing to think through a strategy and pursue it.

I am afraid to say that the present Government manages to combine both.

Clear Thinking, Right Values

The more complex the threats you face, the clearer has to be your strategy to deal with them. But for some years now, complexity has been compounded by confusion.

With the end of the Cold War came not just an end to a threatening Soviet Union but also to the military and moral simplicities to which post-War politicians had become accustomed. It is understandable that it took some time to re-adjust. But it is not excusable that so much fog still remains.

In Britain, this is the result of two inter-connected failures.

First, policy has too often been left behind by diplomacy, which should be an instrument of foreign policy not an end in itself. Recent budgetary pressures have led to a depletion of skills at the Foreign Office.

Moreover, under this Government, it is the politicians and above all the Prime Minister, not Britain's excellent professionals, who have in large part acted as the high level diplomats.

Foreign policy has, as a result, been too re-active, too personal, and too image conscious - not so much grand strategy as grand-standing. It consists of trying to prove our European credentials to Europe's heads of government and our Anglo-Saxon credentials to President Bush, without any serious attempt to weigh pressures and find solutions that suit long term British interests.

Secondly, British foreign policy under this Government has been devoid of a coherent philosophy.

There have, of course, been slogans, like the "ethical foreign policy" which appeared with fanfares and departed in embarrassment. But there has been no underlying, settled conviction about what British interests truly are and how they fit into a wider global vision.

There are no distinctive values which shape or explain what we do in the eyes of an increasingly bemused public opinion. The reason is simple. New Labour's approach to government consists of ensuring that the proclaimed principles don't get in the way of the policies.

The Prime Minister has performed this balancing act with great skill.

Unfortunately, mere pragmatism, with a few idealistic slogans bolted on, does not offer a sufficient guide to steering Britain along a steady and productive path. It is not a substitute for leadership or statesmanship.

A foreign policy rooted in beliefs and values does not need to be doctrinaire. Compromise and timing are always essential. But the principles which hold good for us in domestic policy should be reflected in our foreign policy too.

For me, as a Conservative by conviction, and without apology, these principles are as follows:

Just as I believe that free enterprise, free markets and free trade are the best policies at home, so I believe that they are the surest means of creating prosperity overseas.

Just as I believe that property and the rule of law are essential to the free society we know in Britain and the West, so I want to see them actively promoted in every continent.

Just as I believe that decisions should be taken at the level of local communities wherever possible, rather than directed upwards to state bureaucracy, so I believe that individual sovereign nations should control their own affairs.

Just as I believe in social justice within the United Kingdom, I believe we should do more to help those in developing countries who struggle in the face of man-made and natural hardship.

But I am fundamentally optimistic about human nature when you provide the conditions for freedom to flourish. Given the right framework, we can create a more orderly, more prosperous and more harmonious world.

Not Utopia - but something a great deal better than we have today.

Enlightened National Interest

So much for values. But what about interests?

In a democracy, politicians are responsible to their electors; and those electors expect them to put the national interest first. That is correct. Foreign policy, like charity, begins at home. But what are Britain's interests?

We have to maintain our national independence and our security - that is fundamental. But we have also to keep our economy strong, our markets open, our investments safe. We want to see our society cohesive, our population healthy, our climate tolerable. How, in the realm of foreign policy, do we do these things?

First of all, we have to build on our strengths.

Britain's position in the world today is unique: and it is in many respects uniquely fortunate. We are the world's fourth largest economy. We have first class armed forces. We depend on no single market, our interests are not confined to a region, we are in no one's "sphere of interest".

The rise of China and India present opportunities as well as challenges, which we are potentially well placed to exploit.

We have international influence - as one of the five permanent members of the Security Council; as the closest ally of the only global superpower, the United States; as the birth place of the Commonwealth.

Nor should we forget the intangibles. While the United States may be the political and economic centre of what has been called the "Anglo-sphere" - the community of English-speaking nations - Britain is its historic and cultural hub.

British style institutions are the mark of political maturity. The English language is the Lingua Franca of business, and even diplomacy - to the irritation of the Franks.

Beyond all this, though, we must exert ourselves through international institutions - to whose future I'll return.

A second order power with global interests and ties is especially dependent on global stability. Many issues have to be confronted, wholly or partly, by trans-national means: free trade, migration, fraud, terrorism, global warming - the list could be expanded. We have to be cooperative as well as assertive, to use soft power as well as the harder sort.

Much of the world already bears our imprint. We have an interest in its future, an "enlightened" interest. In fact, "enlightened self-interest" is, I would argue, the goal to which modern British foreign policy must be directed.

In the rest of my remarks I shall try to show how - by referring to five current policy imperatives.

An Open Europe

The first of these is the need to reshape our policy towards the European Union.

Over the coming months alone, the EU will have to make crucial choices: the forthcoming decisions on the EU budget; legislation on the Common European Asylum system; decisions about further enlargement; and decisions about trade reform ahead of the WTO meeting in December.

It is plainly wrong to believe that Europe is not a current issue or that the Constitution is dead. In the next few years there is likely to be a fresh attempt to re-write the EU treaties.

In Britain the Constitution may seem like the second longest suicide note in history. But leading figures in Germany, Austria, Belgium, and Spain, have signalled that they still don't see it that way. The Prime Minister of Luxembourg has even helpfully explained that "the French and Dutch did not vote no to the Constitution treaty".

The most likely course is that different aspects of the Constitution will be introduced by stealth, so as to outflank the embarrassment of democratic consultation. The forces for integration never sleep. Indeed, we have just witnessed a significant judgement by the European Court of Justice which will allow the Commission, rather than member states, to create criminal offences.

This is unacceptable. It is also a reminder that vigilance will be required to check such encroachments. But are the right people on watch?

In truth, the world has changed, but the way in which the European elite conceives of its purpose has not. The Euro may be failing and unpopular and the European Constitution in cold storage, but the drive towards integration, centralisation, bureaucratic intervention and one-size-suits-all policies is set to continue.

Elsewhere, there may be growing recognition of the value of free trade: but the European elite clings onto protectionism, and fights the battle of the bra. This has to change and Britain, for its own sake, must change it.

The urgency is rooted in economics. European Leaders talk as if America was the threat. They should look East not West - towards India and China.

Over the past twenty years, China has been growing at an annual rate of 9.5 per cent and India of 6 per cent. The world has never seen the simultaneous economic take-off of two nations that together account for a third of the world's population. Today the West's manufacturing, tomorrow the West's services, will bear the brunt of their ferocious challenge.

And unless there are radical reforms by governments to deregulate, and by companies to innovate, Europe will fail.

Already facing a demographic shift to older and smaller populations, burdened with pension liabilities, committed to a model of so-called "socially responsible" capitalism, which leaves millions without jobs, most European countries are ill-equipped to match this new challenge.

That is why protectionism looks attractive. But protectionism is ill-named, because it destroys, not protects, the prosperity of those who practise it. It impoverishes consumers, without sustaining producers. It does not work.

And the present European political structure does not work either. So there is general disarray. I am glad that the Dutch and the French voted no. But I am well aware that a shared dislike by European nations of the European Constitution did not imply a popular consensus on the way forward for Europe.

The French want to keep out Polish plumbers. The Dutch want to keep out Muslim migrants. The British want to keep out intrusive regulation.

So while the plans of those who want an ever more closely integrated Europe have been rejected, no alternative vision fills the void. And certainly none is on offer from Mr Blair.

The British presidency is already an embarrassment. The British Government preaches economic reform to Europe, but Europe is not listening. Or more precisely, much of Old Europe rejects the notion entirely, and most of New Europe is moving further and faster than Britain in the direction of reform.

In fact, on one front, Britain under New Labour is a very bad example indeed. We are one of only three European countries where the tax burden will increase both this year and next. High taxes, combined with excessive regulation, spell high costs for business. That can't any more be afforded.

What is required now is a new model for Europe, which will also allow Britain to promote its own national interest.

But it is not on offer from the present Government. The reason is all too clear. Mr Blair is unwilling to make choices or change direction. He supports the European Constitution. He still supports in principle Britain's participation in the single currency.

It is simply not credible at one moment to argue the case for European centralisation and uniformity then suddenly to argue for European de-centralisation and diversity.

The Conservative vision, to which I hold, is of a profoundly different kind of Europe. And it has never looked more timely or more attainable.

It consists of free cooperation between independent European nations, collaborating where that makes sense, imposing their own priorities where universal agreement is impossible - within the framework of a lightly regulated Single Market to which all must subscribe.

The truth is that much of what the EU does today is not part of the "core business" of the Single Market, and there is no good reason why it should be compulsory for all members to take part in every EU initiative.

The seeds of the approach are already there. Not all are within the Euro. Not every country participates in the Schengen agreement on movement across frontiers.

But we should go further. We need to create a structure in which it is possible for member states to choose to take back powers to their own countries.

This is a radical vision but it is the only option that reconciles today's competing views. It recognises differences, it respects national feeling, and it ends the wrangling of competing ideologies for control of the EU.

It would also allow Britain to make changes which the EU in its current form obstructs - ones which, I am convinced, the great majority of the British public, and most politicians, would like to see fulfilled.

Moreover, this is the most sensible option to help Europe cope with further enlargement. On 3rd October, the EU will have to decide whether or not to open negotiations with Turkey. That is a fundamental fork in the road.

The Conservative Party has long advocated Turkish membership of the EU. I believe that we are right to do so. Saying "no" would be a serious setback to Turkey, the most successful, most modern Muslim country. It would do long term harm to relations with the rest of the Islamic world. But the implications of saying "yes" demonstrate how important it is to resolve the debate about Europe's future now.

I believe that the alternative vision I am suggesting is the only realistic way forward. This is because it is based on a clear quid pro quo: the return of certain powers to Westminster in exchange for the right of other states and groups of states to integrate further on the terms they wish.

At the last election, we Conservatives said that we would re-negotiate, for example, the arrangements which currently apply to fishing, overseas aid and asylum, and that we would restore our opt-out from the Social Chapter.

The vision I have suggested would make the return of these and other powers possible. It is the only way to create that Open Europe which we want to see.

The United Kingdom has benefited from its role in the building of post war Europe. The European Union has many achievements. But all member states need to pause and ask the question: is what we have created so far capable of facing up to the new challenges of today without real reform?

In my view, the answer is no.

There is nothing that threatens Europe in the programme I have outlined. On the contrary, it would defuse the tensions which have blighted relations with our neighbours. It is part of resolving the crisis that over-centralisation of power has created. It would open up Europe and help it engage with the wider world. In doing so, it would create a European Union fit for the next fifty years, rather than looking back to the post-war model of fifty years ago. It is the path of progress.

The Atlantic Alliance

Sorting out our relations with Europe will also help manage our relationship with America - my second imperative.

For many years a number of clever people on both sides of the Atlantic have scoffed at the idea of a special relationship. But they should stop scoffing.

Britain today needs America for very practical reasons. We depend upon American support in every region and continent where we have interests at stake. We depend upon American technology to maintain our defence, particularly our nuclear weapon. We depend, above all perhaps, upon special access to American intelligence to maintain our security.

Never has intelligence been more important than now. Those who complain that our closeness to America, in particular our support of the US in Iraq, has made us a target of terror, should think before they speak. Such remarks are a signal to extremists that we will adjust our foreign policy in response to their threats - which merely invites further attacks.

Without the intelligence support we receive from our American allies, our citizens would be more at risk, not less. Islamist terror does not respect the white flag.

And America also needs us. Time and again, we have proved a trustworthy ally. Whenever our armed forces go into battle, they demonstrate valour, professionalism, and extraordinary effectiveness.

In the diplomatic sphere, too, we bring contacts, knowledge, and experience that our American ally values. As a permanent member of the UN Security Council, our support helps legitimise right but unpopular actions which America undertakes. Within NATO, our support for American leadership is what prevents the organisation collapsing into two competing factions.

So we are listened to in Washington - as long as we have something sensible to say. Unfortunately, too often under Mr Blair we do not. For example, our influence over the nature of the operation in Iraq was squandered by an obsessive insistence on prolonging UN-based diplomacy that could obviously yield no result. How much better it would have been to concentrate on ensuring that planning for peace matched the planning for war, before the campaign began.

When Mr Blair goes to Washington with favours to ask, these always seem more connected with keeping up his image abroad - on climate change, on European defence ambitions, on Africa, on the Middle East - than they are with Britain's identifiable national interests. A few concessions are made by the White House, which then have to be twisted and spun into some shallow and ephemeral triumph for Mr Blair.

These tactics do not strengthen public support for the Atlantic Alliance, they erode it. Anti-Americanism is, of course, often the result of international intellectual snobbery. In the absence of straight talking, it is an easy path for trouble-makers to take.

As for Iraq, there is no point now in looking back. The war against Saddam has been overtaken by a war against Sunni insurgents and Al-Qa'eda, which is far more dangerous. This war too must be won, unless the Gulf is to descend into turmoil and the West be put at still greater risk.

The Allies must stay until we can leave behind a stable and free Iraq.

But Iraq is not the only headache. The current stand-off over Iran's nuclear ambitions is a reminder that proliferation remains a deadly threat. There were no weapons of mass destruction in Iraq. But there are other dangerous regimes that have them, or want them.

Each sign of weakness encourages more countries to become covert proliferators. The recent UN Summit's declaration didn't even mention proliferation.

Yet the struggle cannot be shelved, if terrible outcomes are to be avoided.

Security

Foreign and security policy must march together with defence capabilities, and security at home and abroad must also keep in step. We need an approach which guarantees both - which is my third imperative.

Not just in Iraq, but also in Kosovo, Sierra Leone, and Afghanistan, British troops have been helping to defeat aggression and restore order. The demands will continue to grow.

It is right that plans be made now to enable our forces to face tomorrow's threats. But it is wrong to reduce preparedness in the meantime to pay for it.

We should not be cutting manpower. We should be alarmed by emerging capability gaps in both air force and navy. In the procurement programme, key projects have repeatedly over-run schedules and broken budgets. This gives little confidence that even present plans will be fulfilled.

It's nothing less than a scandal that British soldiers go into battle without the right clothing and equipment. It is not the only one. Subjecting soldiers to the International Criminal Court's jurisdiction demonstrates a failure to grasp the worth of morale in combat. The ideology of international human rights lawyers sits uneasily with the duties of servicemen.

Here at home, a distorted understanding of human rights has also weakened our security. It is now clear that the provisions of New Labour's Human Rights Act are a serious obstacle to defending the country from terrorism. There is no other explanation for the Government's continuing failure to deport those who preach and propagate hatred.

Ministers must be able to remove all who pose a threat. There is no more fundamental human right than to be able to live our lives without fear of death or mutilation at the hands of bombers.

The threat of radical Islamist terrorism is the greatest danger the West has faced since the height of the Cold War. Unlike communism, this armed doctrine is not armed with the nuclear weapon. There is no higher priority than to prevent its gaining one.

But there is another respect in which Islamic extremism is like communism: it is fundamentally weak and it is fundamentally doomed. It offers nothing to those Muslims who want to improve their lives and their children's future. Its challenge to the West is expressed through terror, because that is the timeless weapon employed by those who cannot build a majority for their view.

Our task, in response, is threefold.

We have to prevent the extremists seizing a failed or failing state.

We must pursue and destroy Al-Qa'eda wherever they gather.

And time and again we must remind the moderate Muslim world that this is their struggle, as well as ours.

International Institutions

Britain needs stability and order abroad in order to remain secure and prosperous at home. So we need effective international institutions - which is my fourth imperative.

In recent weeks the focus has been on the United Nations. The Volcker Report on the Iraq Oil-for-Food Scandal was damning. Its conclusions reflect no credit on the Secretary General, or on the countries which connived at the abuses.

Nor did the recent Summit distinguish itself. All diplomacy involves compromise. But if countries cannot even agree to define what constitutes terrorism, how can they agree to fight it?

Despite the UN's shortcomings, no other international body has the legitimacy and reach to perform the multiform tasks we expect of it. But it has to prove itself. It has to reflect the idealism of its foundation, and it has to be clinically efficient in giving effect to those ideals.

So I return to human rights. Gross abuses are still occurring despite the theorising and the law-making. They will continue unless there is a real resolution to act. The lessons of Rwanda have still not been learned. Darfur has seen state-sponsored genocide, and the response has been far too timid.

Zimbabwe's regime is a blot on the face of humanity. But Mr Mugabe is feted by his neighbours and his hand is grasped by the British Foreign Secretary.

We have a United Nations Human Rights Commission on which some of the world's worst human rights abusers sit and pontificate.

We need a new idealism to change all this. Britain must be in the forefront of that change.

What we do not need now is shifting chairs on the Titanic, or more precisely increasing the number of seats at the top table. Of course, the Security Council's membership is in a sense anomalous. It is not necessarily set in concrete for all time. But expanding the size of the forum would make it even less capable of decisive action.

For some, paralysis is, I suspect, the attraction, because it makes interventions less likely. But if the Security Council is weak, the UN itself will be bypassed entirely. Moreover, it is not in Britain's evident interests to have yet more permanent members, even without vetoes.

Beyond institutional reform, Britain needs to re-focus its efforts on the less developed world - and this is my fifth and final topic.

Democracy and Development

Doing the right thing and doing what is in your own interests more often than not point in the same direction - particularly in foreign policy.

So we need to promote both democracy and development, because these lead to stability and security for us - as well as benefiting the countries that currently languish in tyranny and poverty.

And we have to promote the rule of law and good governance, because these are the precursors of democracy and development.

Today it makes sense to be concerned for Sub-Saharan Africa - not just because of the unacceptable tragedies of suffering, poverty, and disease, but because glaring global inequalities breed instability. So we must use every lever at our disposal to attack corruption and advance property rights.

It makes sense to be concerned about the systemic failure of Arab states to generate functioning civil societies and free institutions - not just because of so many wasted lives, but because without such states the Middle East can make no long term progress and offer us no reliable partners. So it is right to encourage democratic change, prudently and intelligently, as the soundest foundation for stability.

It makes sense to take vigorous action against the obstacles to development which we ourselves have created, because a richer, economically interdependent world will be more peaceful and secure. So, with Western protection and farm subsidies still costing developing countries almost $40 billion a year in lost earnings, it's essential that the Doha Round be brought to a successful conclusion.

Africa will not become prosperous, nor the Middle East democratic, merely by fine words. We will not defeat Al-Qaeda by fighting a war on poverty alone - whatever explains Bin Laden it is not a deprived upbringing. But we can create the conditions to make a difference. We must do so.

I began by enumerating Britain's advantages. These also represent opportunities - to lead the debate about Europe's future; to help America play effectively the role which only she can play; to contribute militarily to a safer world; to promote sensible reform of international institutions; and to press ahead with Third World democracy and development.

Britain has the moral standing and reputation to do these things, and the British people will take pride in them - if only we can raise our sights."

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