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Thatcher swept aside in wave of EC unity

One of the longest running dramas in Europe is British Prime Minister Margaret Thatcher against all the others. And so it was again Sunday when the other 11 European Community leaders brushed her objections aside and decided to move one more step toward unity by establishing a central bank by 1994. All 12 had no trouble agreeing to resist the blandishments of Iraqi leader Saddam Hussein and unanimously demand that he get out of Kuwait or perhaps face "additional steps consistent with the U.N. charter," doing collectively what they had already done individually.

But it was another matter in their EC summit meeting here, when it came down to the same old argument over how fast to move toward European unity after the common market, which is supposed to remove all trade and people barriers by the end of 1992.

Over Thatcher's objections, the others: 1) set January 1994 as the beginning of the second state of the Economic and Monetary Union (EMU) that is the next step toward unity, including the central bank; 2) approved a report that Thatcher called a "rag bag" establishing a political union as well; and 3) shrugged off her angry calls to debate the long overdue agreement on farm subsidies that is a major issue with the United States.

Isolated again, a grimly cheerful Thatcher gave at least as good as she got by charging the winners were unable to make urgent decisions even while adopting high-sounding plans and goals for the future. But while she may have gotten the last public word in her final press conference, they, principally French President Francois Mitterrand and German Chancellor Helmut Kohl, got what they wanted.

Then she reminded them that she still has a veto.

"We are always prepared to make the urgent decisions," she said, talking about the failure last week to agree about farm subsidies. "But some members openly take the view that the European Community (EC) is projectionist and will stay that way."

She singled out Mitterrand and France, with the support of Kohl and Germany, for blocking even the minimum proposals put forward by the European Commission, which administers the EC. Italian Prime Minister Giulio Andreotti, the current EC president, predicted the agreement would come in a few days, but Thatcher was incensed when they extended the deadline from Tuesday to sometime later in the week.

Still, none of her verbal fireworks changes the fact that this summit unexpectedly set the date for the second stage of the Economic and Monetary Union (EMU) that will include the European central bank and more central controls within a little over two years.

Then in 1997 "at the latest," the final declaration called for a review to prepare for the third and final stage of the EMU.

"I hope to have a single currency before the year 2000," said Jacques Delors, the head of the administrative European Commission who has been one of Thatcher's main targets.

"A common currency, yes; a single currency, no," snapped Thatcher, expressing her opinion that the pound sterling and other national currencies would continue to exist alongside the ECU (European Currency Unit).

Most of the eight or more hours of talks Saturday night and Sunday morning were taken up with two subjects _ the Persian Gulf and plans for the two unions, one economic and monetary and one political, that are to complete European unity.

The Persian Gulf monopolized the conversation over Sunday dinner, and on that subject the 12 stuck together. Mitterrand specifically denied that France negotiated separately with Saddam Hussein for the release of the remaining French hostages who are supposed to arrive back in Paris today.

Among other things, the final communique said:

"They affirm their determination not to send representatives of their government in any capacity to negotiate with Iraq the release of the foreign hostages and to discourage others from doing so."

The leaders went on to condemn the continuing violence in Lebanon, express support for an international peace conference to settle the Israeli-Palestinian problem and endorse the U.N. call on Israel to allow the U.N. to investigate the recent killings of Palestinian rock throwers.

When Andreotti was asked if the current mission of Soviet official Evgeny Primakov to Baghdad was a "last chance" to settle the Kuwait dispute peacefully, he said he didn't believe in last chances, but Iraq had to withdraw.

Despite the 1994 deadline for moving on with the Economic and Monetary Union, both that and the proposed political union will come up again at the next summit meeting in December to inaugurate two parallel conferences to draw up the necessary EC treaty amendments.

Thatcher's veto will come from the fact that those treaty amendments, unlike some EC decisions, have to be unanimous.

"It will be even more difficult," Thatcher said of the December summit meeting that will also be held in Rome.

In their speeches going around the table before dinner Saturday night, Mitterrand observed that the slow movers toward unity _ for that read Britain and perhaps a couple of others _ should not be allowed to hold up the rest.

But on Sunday both he and Andreotti tried to shrug off isolation here by pointing out that it had all happened before and still the 12 EC members, Britain included, had stuck together.

Thatcher's point is that the others are putting the cart before the horse in setting dates before agreeing on the details of the EMU and the political union. Their reply is that progress has come only by setting deadlines as they did in the case of agreeing to complete their common market by the end of 1992.

The vague communique paragraphs on the formation of a political union, she charged, simply listed all the many options. Among the things mentioned were more decisions taken by majority vote and an expanded monitoring role by the European Parliament. The communique also noted "consensus for the objective of a common foreign and security policy . . . to go beyond the present limits in regard to security."

Nowhere did the document mention the North Atlantic Treaty Organization (NATO), which links the United States to Europe. It put off the proposed declaration outlining closer transatlantic relations until next month.

"For us, security includes defense, and we believe NATO is our security," Thatcher said in her final news conference, noting sharply that France's forces are not integrated with the others.

But the harshest part of her counterattack was her criticism of the failure to reach agreement on farm subsidy cuts to present in the latest round of talks under the umbrella of the General Agreement on Tariffs and Trade (GATT) talks, scheduled to end in December.

After seven attempts since September 1986 to reach agreement, the talks again broke down last Friday when after 16 hours France, whose farmers are often up in arms, refused to go along with a recommendation by the EC Commission for a total of 30 percent cutbacks in subsidies for the 10-year period ending in 1996 (not, as I reported Sunday, beginning in 1996).

"Some regard Europe as protectionist," Thatcher said in a jibe at the French and the Germans who support them. "I do not."

Even the proposed 30 percent, however, falls far short of American demands for drastic cuts in European farm subsidies, and Thatcher raised the apocalyptic vision of worsened relations and a world split into warring trade blocs.

Two things the conference here did not do. One was to decide on EC aid to the Soviet Union, although the leaders did hear an interim report by Delors on what is needed. The other thing was to respond to Secretary of State James Baker's plea to cut through the red tape to begin giving the promised aid to the front-line Middle East states of Turkey, Jordan and Egypt.

Asked a few days ago how Britain would regard being isolated again here, a high British official simply commented:

"Que sera, sera, as they say."

A spokesman for the Italian EC presidency, Pio o Masttrobuoni, had another comment Sunday.

"The train driven by the two Marx brothers has taken off, and I think that sooner or later Thatcher will jump on one of the cars."

He may be right, but meantime everybody is holding their hats in anticipation of the next summit meeting in December.