Europe - the coalition shakes

Well, that's clear then. Nick Clegg has described the outcome of the EU summit as "potentially damaging for Britain as a whole".

He said it was "spectacularly misguided" to call it a triumph.

He declared that "there is nothing bulldog" about hovering over the mid-Atlantic.

He pledged to "fight, fight and fight again" to keep Britain in Europe and influential in it.

Those are the phrases from his interview with Andrew Marr which will grab the headlines but there are two claims which are equally significant.

Firstly, the deputy prime minister claimed the outcome would have been different if he had been prime minister at the talks as he would not have to worry about Eurosceptic backbenchers - in other words David Cameron's veto was not the fault of European politics but the inevitable consequence of Tory politics.

He may be wondering this morning why he agreed to a negotiating position which allowed a Conservative Eurosceptic to say "No", blame Europe for it and declare that he had Lib Dem support.

Secondly, Nick Clegg said that those who worried that this deal might damage rather than protect the City of London "might be right". In other words the veto may not even have achieved its goal.

The proposal for a financial transaction tax was always separately veto-able by Britain. The argument about City regulations was about the danger of a newly united eurozone being able to outvote the UK - using qualified majority voting or QMV - under new rules which are still due to come in 2014.

So, now we have a government split between a party which wants to see this veto as the first step to a totally new looser relationship with the EU and a party led by a man who's pledging to "fight, fight and fight again" to stop that happening.

Can a coalition split so spectacularly on Europe be sustained for three and a half years? Will either side want it to be?

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