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No. No. No.

Tuesday, 9 April, 2013

In her two autobiographies, The Downing Street Years and The Path To Power, the late British Prime Minister Margaret Thatcher made clear that she wanted the UK to have no part of EMU (Economic and Monetary Union) in the form of what became the euro currency. With uncanny prescience, she foresaw that Germany would baulk at the inexorable need for greater inflation and that the weaker countries would inescapably become uncompetitive and need bailouts.

“I said that it was psychologically wrong to put ourselves in a frame of mind in which we accepted the inevitability of moves towards EMU rather than attacking the whole concept. We had arguments which might persuade both the Germans — who would be worried about the weakening of anti-inflation policies — and the poorer countries — who must be told they would not be bailed out of the consequences of a single currency, which would therefore devastate their inefficient economies.” The Downing Street Years (1993)

And so it has come to pass. After Greece, Ireland, Portugal and Cyprus have had to be bailed out, and now Slovenia is wobbling into parlous territory. If only the hotheads had listened to Mrs Thatcher 23 years ago, much of the current suffering could have been avoided.

“It will be recalled that when John Major and I had been discussing the tactics required to resist pressure towards economic and monetary union in the summer of 1990, I had been quite prepared for the other eleven Governments to negotiate a separate treaty for Economic and Monetary Union (EMU). Under this, Germany and France would finish up paying all the regional subventions which the poorer countries would insist upon if they were going to lose their ability to compete on the basis of a currency that reflected their economic performance.” The Path To Power (1995)

As it’s turned out, Germany, not France, is paying for the poorer countries in the form of a new wave of anti-German feeling swelling across Europe. The things that vex stony sleep to nightmare are many, as the poet said.


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