British demands upset progress toward EC unity

The nice nations of the European Community (EC) have been forced to postpone what was to have been a crucial summit meeting -- ostensibly because Italy, current president of the EC, is in the midst of a government crisis.

But by wide consent the decision to delay the Brussels gathering betrays a problem much greater than the one confronting the Italian Christian Democrat leader, Francesco Cossiga, as he tries to cobble together a new coalition

At Brussels the EC was to have dealt with British Prime Minister Margaret Thatcher's insistent demand that Britain should pay a great deal less into the Community budget. This is a proposition that enrages the French, causes difficulties for the West Germans, and leaves most of the other member countries in a nervous frame of mind.

Shortly before Mr. Cossiga decided to delay the summit meeting it was apparent that the other eight were heading for a massive confrontation with Britain. The Italian government, after taking advice from EC leaders and top Brussels Eurocrats, decided that the consequences were potentially so damaging that it would be better to take more time in efforts to damp down a crisis that threatens to throw a supposedly uniting Europe into disarray.

Three related problems currently threaten the EC:

* Mrs. Thatcher's determination that Britain's budget contribution, soon to exceed L1 billion ($2.2 billion) annually if nothing is done about it, shall be heavily reduced. With solid Cabinet backing, the Prime Minister has threatened to cut off financial contributions to Brussels unilaterally if the other EC partners do not come around to seeing matters her way.

* The Community's failure to tackle illogicalities in its own structure. Mrs. Thatcher claims that a farm policy that absorbs three-quarters of the EC budget and props up supposedly "inefficient" European food producers cannot be justified. But with general elections ahead this year in West Germany and presedential elections in Frnce next year, political pressures are making it impossible for the European Community to consider radical changes in its political and spending patterns.

* A deeping malaise in the EC arising from the failure of the nine to generate sufficient urgency in the pursuit of political unity and more democratic supranational institutions. By the end of this year, the EC was supposed to achieve full monetary and economic union, a goal that has been abandoned. And the elected European Parliament, though highly critical of the way Brussels officials operate, has not yet gained enough power in its own right to mount an effective challenge to the system.

The result is that dedicated Europeans are obliged to watch the EC marking time, failing to find answers to its own problems, and a constant prey to the selfish political demands of its individual member governments.

Mrs. Thatcher's case for a fairer budget deal has become caught up in these pressures and the situation has probably been worsened by the British leader's abrasive assertion of national interest.

One of the key elements in the decision to postpone the Brussels summit was Mrs. Thatcher's threat to hold back British payments of value-added tax into the coffers of Europe as a response to the Community's failure to correct the budget payments inbalance.

Such a move, Eurocrats say, would violate the spirit of European unity and might be found illegal if taken to the European Court for adjudication -- something the French appear inclined to do.

It was the effect within the European Community of these threats and counterthreats that rang the alarm bells in European capitals.

Prime Minister Thatcher is constantly being made aware by members of her own Tory party, as wel as the Labour opposition, that a mojority of her countrymen apparently favor British withdrawal from the EC.

Such sentiments could get out of hand in the event of a full-scale Brussels row between Mrs. Thatcher and her fellow EC leaders.

Meanwhile, the British Prime Minister's influential Foreign Secretary Lord Carrington has called the dispute over budget payments "a family quarrel" that has been getting "more acrimonious, or anyway more difficult to solve."