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Barrosso Euro Foot in Mouth

Apparently the EU Bureaucrat in Chief told a French TV show that he had been talking to the people who matter in the UK and they want to join the Eurozone. It was a totally extraordinary thing to say in public and the words and phrases used, guaranteed to raise hackles with a considerable percentage of the British electorate.

The UK in or out of the Euro is a non story, the reality is that we in the UK will have to restructure our economy against the background of our floating currency – Sterling because however painful, that effective devaluation is a key part of the solution which perhaps, is what people within the Eurozone fear…

My Personal Objections

There are issues concerning sovereignty and independence in controlling one’s own currency but my main objection today remains the same as it was when the Euro was created: It is like taking the top 10 or 12 Companies quoted on the Stock Exchange and amalgamating their accounts into just one balance sheet.

It ensures that individual success is never recognised and the profits bled away (Germany), neither are the different investment cycles of the specific businesses allowed for either. However this isn’t quite a fair analogy because we are not talking about the top 10 companies in the footsie, we are talking about say 3 and seven unlisted businesses some of which are self employed plumbers and builders.

The Euro was a Political Move

The whole “European Project” has been bedevilled with decisions and moves being made prematurely when common sense would have dictated that the best route is to let ‘nature’ takes its course.

People who advocate the Euro as “the answer” often point to the United States and the Dollar and claim that the Euro is on a par with that but, it isn’t and never will be because the reality is that most Eurozone countries are taking a ride on the coat tails of the German economy and that can’t be considered either fair or tolerable for the German people and ultimately is politically untenable.

Kith and Kin

But the key consideration has little to do with just money, it is to do with kith and kin too in a broad sense and we have this already in microcosm within the UK. Our “Germany” is London and the South East of England, it generates a disproportionate amount of GDP based upon its population. However, being part of the UK has never been predicated upon any particular area or region “paying its way”, history and circumstances change over time.

Places like Liverpool, Newcastle, Glasgow, Belfast and so on were once key productive areas in the UK but the ‘economic circus’ moved on so that now perhaps they need more financial support from central funds/taxation. However the wheel will turn and no doubt these Regions and areas will generate their own prosperity again, but in the meantime, there is no resentment from the rest, no thought or desire that an OAP in an economically depressed area should have less than an OAP in a prosperous one. The reason is belonging to the UK, having bonds of blood and history and it is the same thing that binds the USA too.

Moving on…

I wish the Euro no harm, I do not pray for its demise, long may it prosper but, the UK stays out, we are perfectly capable of surviving and prospering. Bad political and Banking decisions bought us this mess but we can kick the people responsible, imagine if we had been inside the Eurozone. Gordon Brown has tried to blame “American Sub Prime” wholly for our problems but his current and projected borrowings prove the lie of that and it is plain for all to see and hopefully Labour will be severely punished in due course.

Even if Brown suddenly decided to enter the Eurozone, he no longer has the political authority to do so having single handedly destroyed the UK economy through his personal incompetence. In addition our national debt ratio is astronomical so we couldn’t even get within spitting distance of the requirements for membership anyway and indeed, the £ may well drop below the Euro before we have finally steadied the ship.

Part of the “UK’s salvation” will come from the devaluation of Sterling and even a total fool like Brown would be certifiably insane to throw that advantage away. It is a gigantic safety valve that more than one country inside the Eurozone must be wishing they had right now.

Flip the Coin

But perhaps there is another side to this story ? Whilst Barrosso is a bureaucratic little prat, he isn’t stupid, knows full well that there is strong opposition to the EU inside the UK so what is his game in inflaming the situation ? Perhaps it is the Euro that needs long term support. It is a very odd moment for Barroso to bring this subject up.

My guess is that this is a “distraction” engineered to draw attention away from other UK Government problems, problems yet to surface perhaps ?

I suspect that it is a ploy to try and help Brown in some way. The reality is that Brown is the EU’s only hope among British politicians and they are aware that the promised Referendum has caused him damage. So the likelihood is that this is an Aunt Sally, people will talk up the Euro so that Brown can slap it down spouting all sorts of reasons but likely seeking the “last refuge of a scoundrel” by wrapping himself in the Union Flag.