Wheat price is latest issue to sidetrack EC. This time it's Germany that puts agriculture ahead of European unity

Now it's wheat prices. Just when the Europeans thought they had settled all the arguments over subsidies for milk and olive oil, West Germany has ignited a battle by refusing to accept cereal price cuts. As a result, a farm issue will once again dominate a European Community summit. It had been hoped that next month's summit in Milan would center on creating a true ``United States of Europe.''

This latest dispute poses a new threat to hopes of such unity: For the first time, Bonn invoked its veto. Historically, the Germans have promoted European unity, arguing for majority voting and opposing the rule of unanimity forced on the Community in 1965 by former French President Charles de Gaulle.

The German about-face also threatens Community relations with the United States. President Reagan has long voiced anger at the EC's agricultural export subsidies, and his administration is threatening to authorize several billion dollars to help US exports compete. The Europeans know that, to head off such a trade war, they must reform their own common agricultural program.

But the greatest danger remains a breakdown in European ties. Both the British and the French reacted with dismay at the German position.

British Prime Minister Margaret Thatcher wants big cuts in Community farm spending. On cereals, she demanded an 8 percent cut in subsidies after inflation. When it did not come, British papers such as the Financial Times lamented ``West German obstinacy.''

French President Franois Mitterrand seemed almost as eager as the British to bring European farm prices closer to world levels, even though that meant taking on his vociferous farmers. Mr. Mitterrand believes Europe's priorities must be in industry. He wanted to focus in Milan on his ``Eureka'' program to pool European research efforts in such advanced fields as lasers and optics. When West Germany seemed more interested in farm issues, the prestigious Paris daily Le Monde called its editorial, ``Bonn against Paris.''

The net result was to stop movement toward greater political integration. In recent months, more and more European leaders, ironically including West German Chancellor Helmut Kohl, had been talking about the need to relaunch Europe.

A spectacular initiative was hinted at for the coming Milan summit. Some French officials even suggested a ``European'' president be elected by all voting-age citizens of EC countries.

To dig these high-sounding proposals out of the mountain of overpriced wheat, Chancellor Kohl met Prime Minister Thatcher last weekend for a private talk, and he is scheduled to meet President Mitterrand at the beginning of next week.

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