Blair can forget a budget deal in the British presidency unless he wishes to give up the rebate and holler a hollow victory. Chirac and Schroeder, the 'negative Thatcher band', are dancing around their handbags chanting No to reform, No to changes in the Common Agricultural Policy and No to the Doha round.
In unscripted remarks, Mr Chirac told the summit he would veto EU proposals on agricultural reforms at world trade talks if it threatened French farm subsidies.
Amid French fears that Brussels will attempt to force through EU farm reforms by the back door in the World Trade Organisation talks in Hong Kong in December, Mr Chirac said: "We have a position that is simple and clear: the common agricultural policy must be respected in its entirety after it was modified in 2003 with the intention to open up to the world."
Mr Chirac's remarks show that Mr Blair faces a gruelling two months of negotiations on the budget because Paris will not countenance further cuts in farm subsidies after giving ground in the 2003 round.
Will Blair give ground to the rest of Europe like he usually does, or will he 'redline' the rebate? No doubt some figleaf fudge will be written to allow Blair to pay for his political defeat with our money, cementing the EU's stagnation.