Tuesday, 20 December 2011

Highway To The Danger(Euro)Zone

A lot of water has passed under the bridge since my last post but as angry as much of it made me, I got the distinct sense of deja vu. Idiotic local Government decrees, complaints at well-overdue welfare reform, deficit reduction versus 'investment in the public sector'. Whatever the topic I ended up thinking about blogging and then realising each post would simply refer the reader back to posts on identical subjects. So, considering my workload, I chinned it off for a while. Now as we wind down to Christmas and the foot comes off the pedal I have found something worth bleating about - the Eurozone nonsense.

People are up in arms declaring that David Cameron's use of Britain's veto is the turning point in relations between Britain and Europe. It is not. The turning point came when we declined to join the single currency. Having been 'created' at Maastricht in 1992, the Euro was launched on 1 January 1999, though perhaps 1 April 1999 would have been more appropriate. The EU was born out of various European economic pacts, the latest of which was the European Economic Community. The Euro was crucial to the economic pillar of the newly named EU, which was also to broaden its horizons to foreign policy, criminal justice and many other non-economic areas.

However, in the beginning the economic pacts were simple (of far smaller scope - e.g. European Coal and Steel Community) and between fewer countries (ECSC had 6 founding members). The EU though is designed to be proselytising in nature - in a way, it exists to expand, and number 28, Croatia is queueing up at the door. It is because of this that the Euro was doomed to failure.

Countries exist separately because they are different and their peoples are different. They have commonalities that transcend national boundaries and where they find agreement, treaties and accords are created. Where they do not, they do not. That is why country A might have treaties on military policy with country B and treaties on economic policy (broadly speaking) with country C but not vice versa. If we all agreed on everything and all had the same needs and wants, there would be little need for national borders. However, Germany and France still only sign treaties on the areas they agree upon. They do not rub out the border and become Frermany (as much as the Germans may have shown their desire for it over the last 100 years).

The point I am lumbering slowly towards at the speed of European economic recovery is that for something as complex as a single currency to work it would have to have very few signatories, and thus limit the inbuilt national variations, the fluctuations of which will always produce stress. The simpler the premise of the treaty and the less interference it requires in a country, the more likely its success. Likewise the more complex the treaty, the fewer countries must be involved. Two countries can probably find many things they agree upon and draw up a treaty, but as you go out to a wider and wider audience the list of things you actually agree upon gets smaller and smaller.

The Euro was an economic policy idea on the face of it but in essence is entirely political. As is now clear for all to see, for it to be a success economically, it requires political union on a grand scale. The newsworthy part to come out of the European summit was not that Britain is unwilling to bow to control of its economy; budget, taxation et al, from supra-national mechanisms, but that 26 lunatic countries are willing to do so. We are seeing the naysayers of Maastricht proved right - it was indeed the thin end of the wedge. Now we find that a European crisis has very quickly produced the apparent need for total integration (read: Franco/German control) of economic policy across the ever expanding notion of Europe. How lucky a position we find ourselves in to still have a veto and the power to turn down such an indelicate offer of economic invasion.

I am not a Euro-phobe. That is because I do not fear Europe. I do however have grave misgivings about the foundations of Economic Europe. There are so many different types of countries within Europe in terms of development, main industries, culture, religion (I could go on) that one large blanket simply doesn't work. The Baltic states are nothing like the Southern European ones. The Northern European states very different to the Scandinavian ones. That is breaking Europe into just four parts, but within each of those there are vast differences. Why would an economic policy which is right for the production-heavy Germany be right for services-based Britain?

Britain is rightly staying on the sidelines of what is perhaps to be the culmination of a very expensive disaster. People talk of not being at the table meaning you don't have a vote. It wouldn't have mattered how many great sailors you had on board the Titanic after it hit the iceberg; it was always going down. If you ask me, I'd rather be on the Carpathia. Yes we will suffer if the Euro and perhaps with it the EU ends up going down, but getting a front row seat to it all might not be in Britain's best interests.

All the use of the veto meant was that the UK is continuing on with its entirely sensible policy of not joining the Euro and gently moving away from what Europe has become. When hopefully the more slender European phoenix rises from the flames of the Euro I expect our diplomats to be on hand to renegotiate our position with the new Europe. To have a good relationship with other nation states does not necessarily require closer and closer union. Union only works when the roots of those trees bound together are growing the same way. Otherwise it will only ever be paper thin, and the stresses of the organisms under the veneer of union pulling in different directions will always win out in the end. I'm all for Europe, just a much smaller one. One that next time does not get too big to fail.

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