Why are Britain and Germany at such odds over EU's top job?

The current argument between Britain and Germany about who will lead the European Commission may seem like a turf war over Brussels.

But the contest – which remained at an impasse today – has implications far beyond the leadership of the EU institution itself, and could directly impact both Britain's role in the EU and the bloc's cohesion in the face of growing Euroskepticism.

EU leaders have, until now, named the commission head on their own, but with new rules aimed at greater transparency, they are now set to “take into account” the party representation in the EU parliament. What that actually means is still subject to debate, though the ultimate decision will be taken by the EU leaders with a majority vote. No one country can veto it, so Britain needs to get others on board if it is to resist Germany's choice.

German Chancellor Angela Merkel has thrown her weight behind Jean-Claude Juncker, the former prime minister of Luxembourg, to head the powerful EC. He hails from her alliance of center-right parties in Europe, the European People’s Party. The EPP garnered the best overall results in EU parliamentary elections in May, bolstering Mr. Juncker's candidacy. 

But British Prime Minister David Cameron fears that Juncker would push for deeper political union in the EU to prevent another crushing debt crisis. This would hamper Mr. Cameron's efforts to reform an EU that he recently called “too big” and “too bossy.”

At the same time, a protracted power struggle would test the bloc's unity, which is already being challenged by a surge in anti-EU sentiment manifested in last month's elections. 

Mrs. Merkel and Cameron's differences were on display today in Sweden, where both leaders met ahead of an EU summit on June 26 and 27.

"I have said that for me, Jean-Claude Juncker is the candidate for the office of Commission president and that I want to have him as the Commission president," Merkel said at a news conference in Sweden.

Although her words are no surprise to Cameron, they show the uphill battle he faces in trying to push for reform of the EU. He has said that, if re-elected in next year's British parliamentary elections, he would give Euroskeptic Brits the chance to decide via referendum if they want to remain in the 28-member bloc.

At the news conference, Cameron suggested that it might make it harder for Britain to stay within the EU if Juncker is selected. For her part, Merkel said threats shouldn’t be part of the process and go against the spirit of the EU.

Neither Merkel nor Cameron can afford a confrontation. Merkel is much stronger with Britain as a firm ally within the EU. And Cameron needs Merkel, as the most powerful leader of Europe, to bring about his new vision of Britain in Europe.

In fact, no mainstream leader can risk renewed signs of division. Setting aside differences to present a clear and common agenda is key to bringing Europeans on the fence back to the EU fold. But with so much at stake for both, a confrontation might be hard to fend off.