For decades, the European Union was powered by the alliance betweenGermany and France. Co-operation between two nations which had fought three major wars in 70 years was the central reason for the union's existence. As a result, no significant decision in the EU was taken without Germany and France agreeing to it. Not any longer. The Cyprus banking crisis has illuminated the new balance of power in the EU. Last month it was effectively Germany, alone, which set the terms. From Nicosia to Brussels and Moscow, it was clear that Berlin was in charge. EU officials all noticed the change. Where is France, they asked?
There is, though, another way of phrasing that question. In this new German-dominated Europe, where is Britain? Britain may never have placed itself in the very engine room of the European Union, as France chose to do. But does Britain have to continue to sulk in a dinghy being towed along by the main vessel? That, however, is the foolish and powerless position into which David Cameron's European policy has condemned us. But it is not the only possible alternative to the engine room. Britain ought to be playing a more active role than this self-isolation permits.
This week, there is a reminder of the perils which follow from that semi-detached status. Last summer, in an attempt to rewrite the terms of British membership of the union, the government sent letters to its EU partners asking for their thoughts on the impact of European laws in areas ranging from the single market to international development and the environment. Some nations responded. Many others, notably Germany and France, did not. The exercise – dubbed the "balance of competences" review by the UK – was dismissed as a domestic British political exercise, not a genuinely impartial or co-operative stocktaking.
There is a serious failure of British imagination at work here. For the Conservative party's own reasons, it casts its European policy as a repatriation of powers. The Tory mood, fanned by fear of Ukip, is for unilateral detachment. That is why Mr Cameron used the eurozone crisis to make his speech calling for new treaty negotiations which offer the UK an opportunity to loosen its position in the wider EU.
But Germany, it is increasingly clear, does not want Britain to leave. It is cooling on the idea of new treaties which the UK and others may exploit. This ought to be an opportunity for Britain. In quiet ways, like the current work taking place between the British and German ministers for Europe, it already is. But a lot more could be done with an EU policy predicated on reform from within, not repatriation from without. And think how much more effective the UK could be with observer status inside eurozone meetings, instead of pretending that it's all their problem, not ours too.