As the Irishman said when asked for directions “If I were going there, I would not start out from here.” This little parable may be un-PC but the lesson should be learnt that Ireland and a whole host of other EU countries should change the road they are on. Of course the leaders of the eurozone states should not have forced their peoples into the Single Currency but they can still leave and start back on the path to economic growth. However, the Irish political leaders have taken the decision to appease the EU elite and remain in the euro.
Joining Economic and Monetary Union was a route cause of Ireland’s economic disaster and is forcing upon that small country measures that will devastate Ireland for a generation. The euro and its wrong-for-Ireland exchange rate first help create an unsustainable and inflationary boom, which was followed by the mother of all busts. Yet the Republic of Ireland is not free to lift itself out of the mire it is in. It does not have a free floating exchange rate that would allow the currency, not the public finances, to take the strain. It cannot on its own undertake the policy of Quantitative Easing a policy which has helped in the UK. The Republic’s economy, like in Portugal, Italy, Spain and Greece also has to exist – something which it is failing to do – with a currency whose central bank is based in Frankfurt and whose monetary policy favours German needs above those of the other members even though almost every other eurozone state still find themselves in dire economic straits.
The latest news is certainly not good for the euro. In fact it never has been good. From the very outset the euro’s effects were inflationary, making it hard for businesses to plan ahead. Unemployment in the eurozone also shot up, with it consistently higher than in the UK. It is also interesting to note that unemployment is lower still in the European Free Trade Association countries such as Switzerland and Norway which are outside of the EU’s straightjacket.
Before the recession, eurozone growth was sluggish at best. Since the year 2000 the other major developed economies have grown at a rate of 98% faster than the eurozone’s. Meaning that the euro area is starting from a much weaker position than it otherwise could have been in if the nation-states of Europe had kept their right to run their economies in their own best interests.
The euro was built on shaky foundations and the cracks are now clearly showing. The flaw in the system of one currency, across many different states each different Chancellors is now even apparent to the most zealot of the Europhiles. But it is not surprising that the euro’s economic effects have been detrimental. The whole premise of the Single Currency was from the very outset political. It was and remains an economic tool to achieve the further centralisation of the European Union. The E in EMU, the basis behind the euro, stands for Economic (not European) and is intended to create Economic and Monetary Union which in policy terms is meant to lead to a fiscal union with Brussels taking effective control of member-states tax and spend policies.
Chancellor Kohl of Germany and President Mitterrand of France saw the creation of the euro as an act to bring in political union over time. Furthermore, Charlie McReevy, the Irish Finance Minister when the Single Currency was introduced, said at the time that it was a momentous step for the European Union. Its repercussions are certainly with us today.
The euro is creating a crisis across the EU, yet as always Brussels is determined to turn this into a beneficial crisis and take more power over tax and spend; powers which Brussels has long coveted as occupying these important policy fields will allow the EU to truly eliminate the last vestiges of the nation-state.
Britain has been in the position where the eurozone states now find themselves. Sterling was locked into the precursor to the euro, the Exchange Rate Mechanism (ERM) and this simply exacerbated and prolonged the recession but after ‘Golden or White Wednesday’ we managed to escape. Countries like Portugal, Italy, Ireland, Greece and Spain face the real prospect of having to choose between complete collapse or defaulting on their debts and leaving the euro. But the key issue behind the euro is one of European construction, it is a political project and it is therefore not surprising that the EU-elite are putting the existence of their flagship project above that of economic common sense.
The “one-size-fits-no-one” interest rate has locked-in the economies of the eurozone and the pressure is rising. Allowing their currencies to float will, in the long term, alleviate the pressure. The alternative is to bottle up that pressure, turning currency tremors into earthquakes.
We can be grateful to the good sense of both the British public and business leaders who, earlier this decade, saw that Britain giving up the pound for the untried and untested euro would not be in our future interests.
Yet it is greatly disappointing that we do not have a Prime Minister that is prepared to take advantage of the crisis in the eurozone and stand up to the Euro-elite by forcing the return of power to our elected representatives. With the EU simultaneously undermining so much of our freedom and democracy whilst costing the British taxpayer billions of pounds each year and damaging our economic prosperity it is perverse that the policy of the British government is to support the euro with British money; thus supporting the unaccountable and undemocratic EU and its flagship policy of Economic and Monetary Union.
David Cameron it is time you realised that just as the euro is wrong for Britain it is also wrong for other countries. Britain should re-realise its historic mission in Europe. This is not to kowtow to the continent being dominated by a single political entity but to resist it in the name of freedom and the nation-sate. Since the time of the Duke of Marlborough in the early eighteenth century to the time of his descendent, another Churchill, in the 1930s and 40s, this was the UK’s task; especially so in the Napoleonic era and even up to the 1960s when Britain led the creation of the far more prosperous European Free Trade Association, an alternative to the EU. Britain should now lead in dismantling the euro and helping others out of the EU.