Romney's strong debate showing puts Europe on edge
* Romney's dominance in 1st debate unsettles some in Europe
* Many EU leaders would prefer second Obama term, diplomats say
* Obama still seen ahead in polls, but margin narrowing
By Luke Baker
BRUSSELS, Oct 4 (Reuters) - President Barack Obama's lacklustre performance in the first U.S. election debate provoked uneasiness in European capitals on Thursday, where hopes are mostly, if unofficially, pinned on his securing a second term.
While a lot can change before the Nov. 6 vote, and Obama and Republican challenger Mitt Romney will go head to head twice more before then, polling conducted immediately after the debate showed Romney came out overwhelmingly on top.
A flash poll by CNN showed 67 percent of viewers thought Romney had 'won', with just 25 percent for Obama. Intrade, an online prediction market, cut Obama's re-election prospects from 74 percent to 66 percent.
In Europe, where leaders and finance officials have worked closely with the Obama administration over the past 2-1/2 years trying to resolve the euro area debt crisis, there was particular consternation at Romney's singling out of deficit-ridden Spain as a poorly administered economy.
"Romney is making analogies that aren't based on reality," Foreign Affairs Minister Jose Manuel Garcia-Margallo told reporters after a meeting of his centre-right party.
Leading Spanish daily El Pais highlighted the fact that Spain was the only European country mentioned, and contrasted Romney's negative depiction of it with Obama's praise for Spain's renewable energy policies during the 2008 campaign.
"Spain has never been mentioned in a presidential debate as a symbol of failure," the left-leaning newspaper lamented. "What happened last night makes history. And not in a good way."
Political commentators in France and Germany registered surprise at Obama's underwhelming performance, saying the election could be much tighter as a result.
"Obama showed a lack of desire to be president, which could put him on shaky ground as a presidential candidate," said liberal German news magazine Der Spiegel.
"It's now clear that to get back into the White House the U.S. president needs running shoes, not flip-flops."
France's Le Monde appeared equally surprised by Obama's sub-par performance. "Where did the favourite go?" it asked on its front page, with a headline below saying: "Obama fails his first televised debate against an incisive Romney."
LEANING OBAMA'S WAY
In private, many EU diplomats have no qualms about saying they want Obama re-elected; it is no secret that many European countries, whether led by centre-left or centre-right governments, are more broadly aligned with the Democrats when it comes to social and tax policy, the environment and a range of foreign-affairs issues.
That is something Obama has sought to exploit in the past. In the run-up to a G8 meeting at Camp David in May, White House officials firmly pressed their European counterparts to rally behind Obama's policy initiatives, according to those involved.
"It was like all of the G8 apart from Russia and Japan were expected to be part of the Obama re-election campaign," the chief of staff of one European leader told Reuters at the time.
Washington has also applied quiet pressure on Europe in recent months about the need to avoid a major blow-up in the debt crisis ahead of the election, in part so as not to rattle the U.S. economy, several EU officials have told Reuters.
Europe's leaders have good reason to go along; they want to keep a politically risky crisis under wraps, too, and they want to expand the close working relationship they have developed with Obama's administration over the past four years.
"The Europeans have a general uneasiness about a Romney presidency," said Jan Techau, the director of Carnegie Europe.
"It's not because they don't like him, but there are a lot of neoconservative policy advisers who would come back into office under a Romney presidency, and that is a prospect that a lot of European leaders are not comfortable with.
"There's a general tendency to stick to what you know and what you have been working with," he told Reuters.
"DEAL WITH IT"
Romney has also not done much to endear himself to the Old World. During a visit to Britain ahead of the Olympics in July he cast doubt on how well prepared London was to host the games, and in Israel days later he appeared to criticise Palestinian culture, leading to widespread condemnation.
One of Romney's advisers on a "Europe working group" is Nile Gardiner, a Briton who was an aide to former British Prime Minister Margaret Thatcher and now works for the conservative Heritage Foundation in Washington.
In an opinion piece in the Washington Times last month, Gardiner was decidedly downbeat on Europe, saying the continent was in terminal decline and European integration was misguided.
"The European Project is falling apart, drowning in a sea of debt, and driven by bureaucrats in Brussels who lack any semblance of democratic accountability," he wrote.
Those sorts of opinions among the circle around Romney have raised hackles in Europe and fuelled hopes that his challenge for the White House will fail.
Obama still holds an advantage in opinion polls, including a daily Reuters/IPSOS tracking poll that gives him a 47 percent to 41 percent lead over Romney, a margin that has held fairly steady since mid-September.
With just 33 days before the election, Romney still has a hill to climb to unseat Obama, but two more strong performances in the debates could tip undecided voters his way.
In Europe, leaders are watching closely and will be ready to suppress their Romney reservations if need be.
"Even though we have a natural predilection for Democratic presidents, we'll embrace the next U.S. president whoever he is," said one diplomat in Brussels. "We just have to deal with it."