Brexit talks turn dirty -- but is Theresa May ready for the fight?

Theresa May hosts European Commission President Jean-Claude Juncker at  Downing Street.

London (CNN)It was the dinner date from hell, and the fallout has lasted for days. Devastating accounts of a meeting last week between British Prime Minister Theresa May and European Commission President Jean-Claude Juncker sent Downing Street into a tailspin from which it has struggled to recover.

The encounter -- intended to pave the way for formal Brexit talks later -- went "badly," the EU side said. British officials were in a "different galaxy." Juncker was so aghast that he called German Chancellor Angela Merkel at 7:30am the next morning. May, an anti-spin politician used to conducting such discussions with discretion, was floored.
Theresa May: The UK is leaving the EU
brexit

    JUST WATCHED

    Theresa May: The UK is leaving the EU

MUST WATCH

Theresa May: The UK is leaving the EU 01:07
The Prime Minister was still picking up the pieces on Tuesday. After initially dismissing the accounts as "Brussels gossip," May tried another tack, telling the BBC that if the EU tried to play hardball, they would find her a "bloody difficult woman" -- recalling a Conservative Party colleague's hot-mic characterization that unintentionally boosted her credentials when she ran for the leadership of her party.
The leak is more than just gossip, of course -- it shows two sides in a difficult negotiation process very far apart, with little sense of common ground.
It suits the Prime Minister to try to rise above the leak, but by failing to deny outright the account, first reported by Politico Europe and then amplified by a full-page story in the German newspaper Frankfurter Allgemeine, she has allowed it to stand as an authoritative version.

Dirty fight

One lesson to be drawn from the row is that EU officials are prepared to fight dirty as the Brexit process gets underway. It is a very different kind of diplomacy and the response from Downing Street raises the question whether May is prepared to fight just as dirty to get what she wants.
The account in Frankfurter Allgemeine was so detailed it can only have been authorized by senior EU officials close to Juncker, suggesting that the commission president's circle had its gloves off before he arrived in Downing Street last Wednesday.
The way Juncker telephoned Merkel the next morning fueled the sense that, to copy a phrase used by the British prime minister last month, the rest of the EU is "ganging up" on Britain. A few hours later, Merkel issued a stern warning against UK "illusions" over Brexit.
President of the European Union Jean-Claude Juncker and British Prime Minister Theresa May walk between photo calls at a summit in Malta in February.
There were rumors in Brussels that the European Council, which sets overall EU strategy and is led by Donald Tusk, were unhappy with the commission over the hostile briefing operation because it undermines trust in a delicate negotiating process.
EU sources also suggested that the German Chancellor herself is not pleased at being dragged into the row by featuring so prominently in the leaked account. Fingers were being pointed at Martin Selmayr, Juncker's bruising chief of staff, as being behind the leak.
The account may undermine the trust between the two sides, but it served a useful purpose, according to Fabian Zuleeg, chief executive of the Brussels-based European Policy Centre. He said: "I think it was entirely to highlight how far apart the positions are between the two sides and that there is still a lot of disillusion on the British side.
"We don't know for sure who leaked, but ... one of the comments from Juncker that she is in a 'different galaxy' was an attempt to express how difficult those negotiations will be."
"It is not particularly surprising that there was a leak. There is a clear difference in understanding between the two sides of how this process is going to work and what it will imply. For me that suggests there is a very good chance that we will end up with no deal at all."
EU officials were particularly taken aback at the refusal of May to accept that talks about a British-EU trade deal could not start until the so-called "divorce" bill was settled -- something at odds with her more conciliatory tone when she triggered Article 50.
European Council President Donald Tusk (R) was said to have been dismayed at the reports.
Charles Grant, the director of the Centre for European Reform, said the substance of last Wednesday's meeting was more important than the nature of the leak "because to quote the German government, they [the British government] appear to be deluded on a range of the issues".
He added: "When Theresa May issued her Article 50 letter it suggested that she was adopting a more realistic approach about the painful truths of Brexit, but this suggests that May has gone off that."
Grant said that Juncker's reported comment that "Brexit cannot be a success" may not have been very diplomatic but he was reflecting the position of the EU27 and the German government, which was that Britain must not be as prosperous outside the EU as it was inside it.
He said: "It was a policy position. It wasn't very diplomatic but he was trying to bring the British back to reality as they are out of touch with reality on all of those issues."

May on the back foot

When she was Home Secretary in David Cameron's government, May was used to getting her own way. And in Brussels, there is a history of British prime ministers driving a hard bargain to get what they want: Margaret Thatcher secured a rebate for the UK from the EU, Tony Blair refused to sign up his country to the single currency.
But back then, Britain had a stronger negotiating position because it was inside the bloc -- now, as it prepares to leave Europe, its hand is weak because it has no trump card. It has nothing to trade.
Brexit: What happens after Article 50?
Brexit: What happens after Article 50?

    JUST WATCHED

    Brexit: What happens after Article 50?

MUST WATCH

Brexit: What happens after Article 50? 01:29
Amid the fallout, May seems to be on the back foot. But some in May's Conservative Party believe it will suit the Prime Minister to be portrayed as "in a different galaxy" to the EU because it showed she was refusing to back down on the request of the British people to withdraw from the EU.
It will certainly delight hardline Euroskeptics in the Conservative Party who would prefer no deal at all to a "bad deal."
Zuleeg echoed this view, saying the report of the dinner would be politically beneficial to May in the run-up to next month's general election. He said: "Will this damage the size of her election victory? Probably not. In some ways it is convenient to portray her as the sole leader standing against the EU, the single fighter against the bureaucracy of other countries ganging up against Britain. In that sense there is no damage."
"Has it been damaging in terms of negotiating a deal -- to some extent, yes. But the one question for achieving a deal is whether Theresa May is willing to compromise on the very difficult red lines she has set out. If she is not willing to compromise on those then a deal looks quite unlikely."