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Europe needs a leader. It should have chosen one when it had the chance.

Stock markets tumble, the banks are in crisis and Europe cries out for direction. “We don’t know who is in charge” says former Italian prime minister Romano Prodi.

EU leaders should be reminded that they have only got themselves to blame. Two years ago they had the chance to put someone in place who could have help fill the vacuum of leadership which is crippling the response on both sides of the Atlantic.

But when the moment came to choose the first proper President of the European Council, they picked the unknown Herman van Rompuy over the infinitely better qualified Tony Blair.

It was an epic misjudgement, a deliberate decision to choose weakness over strength, invisibility over stature, putty over steel. In the diplomatic Olympics, it was the equivalent of passing over Steve Redgrave in favour of Eddie the Eagle.

The decision, of course, was welcomed by many commentators in Britain. Here the  EU President’s role was widely mocked as a vanity job, a pointless orgy of limos and canapés.

Today’s events show how wrong that was. The job of bringing Europe’s fractious parties together, corralling and cajoling them to make decisions, is both difficult and vital. We are all paying the price for the absence of anybody who is able to do it.

Around Europe, there were plenty who did want Tony Blair to do this job. It wasn’t hard to see the advantages of a heavyweight who could not only galvanise Europe but, as David Miliband put it, stop the traffic in Washington or Beijing.

Blair had formidable qualifications. He had extensive experience on the world stage. Northern Ireland showed his ability as a patient but determined negotiator. His contacts were unrivalled. People like Barack Obama hadn’t only heard of him, but openly admired him.  And his gifts as a communicator meant he could explain the importance of Europe both to its citizens and the wider world.

Still younger than many of the world’s leaders, able and willing to serve, this was a golden opportunity for Europe. Tragically, it was a chance his former colleagues spurned.

The problem was that there were too many EU leaders who didn’t much like the idea of a bigger, better, more effective, more famous figure taking their limelight.

Elsewhere in the world, the notion that we could pass up Blair in favour of a Belgian non-entity was greeted with bafflement. It was viewed, rightly, as an eloquent illustration of Europe’s apparent death wish.

People in Brazil, India or Australia must assume we are completely mad. It is one thing to face declining influence in the world – another actively to choose irrelevance.

Their verdict has been proved right. Watching poor Mr Van Rompuy struggle over the last 18 months has been embarrassing.

Even in EU capitals, few know his name. In meetings at the White House or Kremlin he cuts a pathetic figure.

As they dither, squabble and pass the buck, pleas from European Commission President Barroso and ECB chief Jean-Claude Trichet for somebody to take a lead fall on deaf ears. In the turmoil, Van Rompuy is invisible, irrelevant, impotent. What we need is somebody to get a grip.

Let’s hope memories of this lack of leadership last beyond this current crisis. Next year, we have a chance to put this right, when the President’s job comes up for renewal.

We can only hope Europe learns its lesson – and that Tony Blair is still willing to serve.

Meanwhile, Europe’s ship faces the storm with nobody of real stature on the bridge.

It could have been different.

Steve Morris is Portland’s Managing Partner. He worked at the European Commission in Brussels for five years and subsequently was an adviser to Tony Blair in 10 Downing Street

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Steve Morris