Britain's Sad Plight

Most Common Market decisions are the product of purposeful near collision: a game of diplomatic chicken in which the antagonists wait until the last possible moment to veer off into compromise. Not surprisingly, Europe resounded last week with cries of crisis as the foreign ministers of the Six pre pared to meet in Brussels this week to deal with Britain's second application for Common Market membership.

Common Market Commission President Jean Rey warned that failure by the Six to agree to negotiate with Brit ain would produce a "grave crisis" and be "a frightful political blunder." returning from a London visit with Prime Minister Harold Wilson, Rey reported that Britain wanted no part of a lesser association with the EEC, or any other arrangement short of full membership.

West German Foreign Minister Willy Brandt, also back from a visit to Brit ain, told the Bundestag that "a negative decision would mean stagnation."

Friendly Five. To avoid a head-on collision with France, the ministers of the "friendly Five" worked out a com promise formula that is not likely to satisfy anyone completely but may cool matters. The formula agrees that Brit ain should be given a definite answer to its application by the Six this week, just as London demands. But it further provides that if France's intransigence prevents a unanimous reply, as seems certain, the whole matter will be put off and discussed later.

Such a deferral would only add to Wilson's woes, since Britain's domestic support for Common Market entry is eroding. Once 62% of the British people favored Common Market member ship, but the latest national opinion poll indicates that only 39% now do.

And everywhere Wilson looked last week, he saw trouble. Though the devaluation of the pound came on Nov.

18, the Board of Trade reported that Britain's November trade deficit was the worst in history: $530 million. The bad news dropped the minipound last week to the lowest level of its short life-- $2.4005-- and sparked a fresh round of gold buying on the London market and new speculation against ster ling. It was small satisfaction that the French, who have done their share of speculating against the pound in Brit ain's recent troubles, suddenly found themselves tarred by the same brush: ru mors of a devaluation of the franc plummeted France's coin of the realm 21 fractional points in a day, to 20.200.

A Coalition of Ideas. For Britain, things do not promise to improve any time soon. The National Institute of Economic and Social Research esti mates that at best the effects of devaluation will improve Britain's balance of payments by only $156 million in 1968; not until late in 1969 can it expect to turn smartly into the black. Meantime, domestic food prices have risen 3.8% since devaluation and will rise 5% to 15% after the first of the year. The powerful Trades Union Council still insists that it will seek a wage rise of an average $1.68 a week to take effect next June, which could endanger the advantages of devaluation by increasing the costs and prices of British exports.

As it is, British exporters have so far responded disappointingly to the opportunities that devaluation affords for selling more cheaply abroad. Many, in fact, have actually raised their prices. Scotch distillers pumped prices up 11.5%, dye sellers 16.7%. Even when letting their prices fall with the pound, some exporters have stopped short of full value, gauging what the traffic will bear. MG-maker British Motors, for example, reduced prices 12% in Europe, but only 3% in the U.S.

Britain's economic plight and its failure to make any headway with the Common Market constituted such a mess, said maverick right-wing Tory Duncan Sandys, that the country needed "a coalition of ideas" of both parties--an oblique appeal for a national government, as in World War II. The idea got few takers. Despite the hard knocks he has received lately, Harold Wilson is not yet ready to admit defeat. As for the Tories, they are not that eager to help bail Wilson out of the mess.

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