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- To Be, Or Not To Be A Country - that is the question; Sir Oliver Wright, GCMG, DCVO, DSC.... more
- They are not more European than we are. They are just more federal; Mrs. Thatcher
Cameron
After Thatcher, conservatism in Britain became radioactive. As Tony Blair moved the Labour Party to the center, the Tories moved right, became extreme and thus politically unviable.
Fareed Zakaria, Newsweek 11/7 2010
Fareed Zakaria is editor of NEWSWEEK International and author of The Post-American World and The Future of Freedom: Illiberal Democracy at Home and Abroad.
Their vote totals fell to historic lows, which partly explains why they have not become a majority despite the largest gain in parliamentary seats since the 1930s. Cameron has tried to return the party to the center on all kinds of issues—from the environment to gay rights—but he still has not earned all the public’s trust. Minorities and working women still find it hard to vote Tory (so do Scots, but that’s another matter).
The eurosceptic case for saving the euro
John Redwood, The Times May 27 2010
What we won't do is provide support for the euro
- that has to come from those countries that use the euro."
UK Chancellor Alistair Darling BBC Sunday, 9 May 2010 17:42 UK
So far as Europe is concerned there is a separate proposal to make available help to eurogroup members as they do to non-eurogroup members like Hungary and Romania. Subject to the right safeguards, and IMF involvement we could support that," he told the BBC.
European elections 2009:
Ukip claims political breakthrough
The UK Independence Party claimed a political breakthrough as it
pushed Labour in to third place
Daily Telegraph 8/6 2009
Labourpartiet fick bara 15,3 procent och hamnade efter både Tories med 28,6 och
det EU-fientliga UKIP med 17,4 procent.
SvD 9/6 2009
Det är väl en stor nyhet att UKIP i England fick fler röster än regeringspartiet Labour
Rolf Englund 13/6 2009
The UK government's policy on Economic and Monetary Union (EMU)
HM Treasury
The prime minister was accused by Tories of “treating the British people like fools” by claiming the new treaty was fundamentally different from the treaty thrown out by Dutch and French voters in 2005.
Financial Times 19/10 2007
Enligt en opinionsundersökning som tidningen Financial Times presenterade på torsdagen
70 procent av väljarna i de stora EU-länderna Storbritannien, Frankrike, Tyskland, Italien och Spanien vill ha en folkomröstning.
DN 18/10 2007
Tjugo procent menar att det onödigt att fråga väljarna, medan 10 procent är osäkra. I Storbritannien förordar 75 procent av väljarna folkomröstning.
Mätningen visar också att 38 procent av väljarna i de fem länderna tror att fördraget är bra för EU-arbetet, medan 23 procent är negativa.
Irland är det enda EU-land där fördraget måste godkännas av en folkomröstning. I de flesta andra länder blir fördraget en fråga för parlamenten.
Tony Blair utlovade en folkomröstning om författningsförslaget som fransmän och holländare sade nej till 2005.
Nu säger Gordon Brown att det aktuella EU-fördraget är något annat än författningen. Men i grunden är det ingen skillnad, argumenterar Derek Scott i ledningen för I want a referendum.
- Gordon Brown måste gå med på en folkomröstning för att behålla väljarnas förtroende, menar Scott.
Some 76 per cent of Germans want a referendum, 75 per cent of Britons, 72 per cent of Italians, 65 per cent of Spaniards and 63 per cent of French.
Financial Times 18/10 2007
The Economic Implications of the Revived and Renamed EU Constitution
Robert Oulds, Bruges Group, October 2007
David Blunkett, the former home secretary, challenges Brown on EU vote refusal
Daily Telegraph 30/8 2007
In terms that will infuriate the Prime Minister, Mr Blunkett said Mr Brown and his ministers had "a long way to go" before they had provided "a proper answer" to the growing number of Labour MPs, unions and members of the public demanding a referendum.
David Blunkett stoked Labour divisions over Europe last night by challenging Gordon Brown to explain why he was denying the British people a referendum on the European Union reform treaty.
Mr Blunkett suggested his own party - having promised a referendum on the defunct Constitutional Treaty in its 2005 election manifesto - had failed to explain adequately why its replacement, the EU reform treaty, was substantially different and therefore did not also merit one.
Ministers began a fightback against growing calls for a referendum on the European Union amending treaty on Tuesday,
insisting the draft document was essentially different from the failed EU constitution.
"the constitutional concept has been abandoned"
Alex Barker, Financial Times Political Correspondent, 29/8 2007
The movement for a popular vote has built a head of steam, with Gordon Brown coming under pressure from both the pro-European and eurosceptic wings of his own party.
The threat of a backbench rebellion was raised after Ian Davidson, a Labour MP and long-time eurosceptic, wrote to the prime minister asking him to listen to his “own people rather than the European political and bureaucratic elites”.
His letter followed a decision by pro-European unions to support a motion for a referendum at next month’s TUC Congress because the treaty threatened workers’ rights.
On Tuesday, Mr Miliband rejected calls for a referendum from the Conservatives. “We have not got a European constitution,” he told the BBC’s Today programme. “Twenty-seven European heads of government all signed a document in June, after nearly two years of negotiation,
saying the constitutional concept has been abandoned.”
Conservatives have stepped up the pressure on Gordon Brown to stage a referendum on the new EU Treaty
- by publishing a translated version "in plain English".
Conservative Party August 7, 2007
With other European leaders openly confirming that the obscure legal text of the official Treaty is essentially the old EU constitution dressed up in a new document, William Hague declared: "This is the Constitution in all but name; the British people were promised a referendum on it; so let them have that vote."
The ICM poll for the Daily Mail showed that 82 percent of voters as whole
- and 80 percent of labour voters -
want a referendum on whether to accept the treaty or not.
EU Observer 20/8 2007
Former British chancellor Kenneth Clarke,
who is reportedly making a bid for leadership of the opposition Conservatives,
has changed his attitude towards euro, referring to it as a "failure".
EU Observer 23/8 2005
Martin Wolf, FT 3/6 2005:
It is essential for the UK to avoid joining the eurozone,
which looks quite as dysfunctional as prescient
(perceptive, cautious, foresighted) critics feared,
About a recent book from the Institute of Economic Affairs:
Should Britain Leave the EU?
An Economic Analysis of a Troubled Relationship, Patrick Minford and others
When I returned to the UK in 2003 after five years in Germany, I was surprised to see how europhobic the country had become.
Previously, the most outspoken eurosceptics were Conservative backbenchers and a few excitable newspaper editorialists.
Now they are everywhere. There are few countries in Europe where people tell you - while managing to keep a straight face - that
Brussels consists of corrupt bureaucrats who conspire to destroy democracy.
Even the business community has turned eurosceptic.
Wolfgang Munchau Financial Times May 16 2005
Most opinion polls suggest that Tony Blair is likely to win the general election pencilled in for May 5 2005.
Most opinion polls suggest that Tony Blair is likely to lose the referendum on the European Union's constitutional treaty probably not be held until September 2006
Philip Stephens FT 1/2 2005
Eighty-six per cent of Institute of Directors members have said they believed the constitution would mean more red tape from Brussels.
Sir Digby Jones, director-general of the CBI, has argued that the charter of rights would take British employment legislation "back to the 1970s".
Tim Congdon and Timothy Kirkhope Financial Times March 16 2005
Britter och svenskar har ett viktigt gemensamt Europaintresse,
att bevara ett mer löst organiserat, utåtriktat Europa än det mer integrerade Europa Tysklands utrikesminister Joschka Fischer förespråkar
Vernon Bogdanor, statsvetarprofessor Oxford DN Debatt 28/11 2004
Michael Howard on Tuesday put the Conservatives on course to adopt
the most eurosceptic manifesto offered by a main UK political party in two decades when he pledged to “bring powers back from Brussels to Britain”.
Financial Times 6/10 2004
“Some of our European partners want to integrate further,” Mr Howard told the party conference in Bournemouth. “I'll say to them fine, Britain will no longer try to stop you. But we must have something in return. We want to bring powers back from Brussels to Britain.”
Mr Howard's stance means the Conservatives are set to unveil the most eurosceptic manifesto since Michael Foot's Labour party pledged to leave the European Community in 1983.
We beat the Liberal Democrats in the European elections. We beat the Conservatives tonight
Roger Knapman, on UKIPs 3rd Place Success In Hartlepool
If Labour bosses are punching the air in relief at the Hartlepool result, Michael Howard must be tearing his hair out in despair.
In what was claimed to be one of the worst results in modern times for the Tories, his party was pushed into a humiliating fourth place
behind the UK Independence Party
BBC 1/10 2004
The eurosceptic case for saving the euro
John Redwood, The Times May 27 2010
We should not be frightened of a new EU treaty that seeks to ensure the euro’s survival; it could be an opportunity for Britain to seek the repatriation of powers in return for allowing the eurozone countries to enter a tighter union.
Single currencies are usually an expression of nationhood. They thrive on a sense of mutual belonging and responsibility and can survive for centuries when they enjoy common financial government.
London and much of the South East is a strong, competitive economy but Liverpool or the Welsh valleys cannot devalue to make themselves more competitive. Instead, central government sends substantial transfer payments to the parts of the union that have higher unemployment and lower incomes to make the union tolerable. We all accept this as part of the price of belonging to the common currency area.
Our own single currency saw the exit of the Republic of Ireland in 1979 when the Irish pound free-floated against sterling. It made sense for Ireland to express its nationhood with its own currency. The first impact was a modest devaluation against sterling, which helped to fuel Ireland’s great economic growth of the late 20th century.
Its surrender of its currency when it first entered the euro helped, as it gave Ireland lower interest rates that pumped up the credit bubble. Now it is a hindrance because it leaves Ireland less competitive.
Discussions about treaty changes to allow more central control of eurozone states’ budgets are much needed. The UK is right to say it will not join the euro or accept any new intrusion into its financial policies. The UK’s refusal to join has saved the euro so far. Had we been a member, our huge borrowing needs — far larger in absolute terms than those of Greece — could well by now have broken the euro, as we broke the exchange-rate mechanism, its forerunner.
Full text When Michael Howard appointed the arch-eurosceptic John Redwood to the opposition front-bench team this month, the move was widely seen as a lurch to the right for the Conservatives, and more open hostility towards the European Union.
Financial Times editorial 22/9 2004
Tony Blair could not conceal the
magnitude of his U-turn when he announced a referendum on the European Union's
new constitution yesterday.
Mr Blair could give no answer to
questioners who repeatedly asked why he had changed his mind. The prime
minister said he had been convinced that people wanted a vote. His performance
was uncharacteristically subdued, as was the reaction of the Labour MPs behind
him. After all, it was only three weeks since 319 of them had marched into the
No lobby to vote against a referendum.
Financial
Times editorial 21/4 2004
A referendum: brave, right and risky
The Prime
Minister is putting his future on the line for the sake of his principles, and
that is something every democrat should applaud.
Daily Telegraph 19/4 2004
With a budget deficit of 3.2 per cent
Britain is in no position to lecture anybody
The decision to join an
economic and monetary union is profoundly, if not exclusively, political
Wolfgang Munchau, Financial Times, March 18 2004
Blunkett has failed to wake up to the immigration
nightmare
We are at a watershed. Political correctness has finally
collided with practical reality.
Andrew
Green, Daily Telegraph 24/02 2004
Storbritannien är fortfarande inte redo
att närma sig euron och kommer inte att göra det före nästa
val. Det slog finansminister Gordon Brown fast när han på torsdagen
presenterade sin nya budget
DN 17/3 2004
Opposition parties have hit out at government measures
devised to cope with a potential increase in migrants to the UK when the EU
expands in May.
The Conservatives said the scheme did not go far enough
while the Liberal Democrats said was an over-reaction.
BBC 24/2 2004
Blair's big failure on Europe
Joining the euro
was the essential emblem - it was the mission for Mr Blair's second term.
The dream has died.
Philip Stephens,
Financial Times 24/2 2004
Tony Blair: Migrants from the countries joining the EU in
May
will have to work or leave the UK
BBC 23/2 2004
Will not France and Germany seek to exploit Mr Blair's
delight at being at the heart of Europe for their own ends, the first to build
a defence capability to rival Nato's, the second to advance a federal agenda?
Daily Telegraph 19/2 2004
Michael Howard, the Conservative leader, drew two
ineradicable lines in the sand on Thursday
he said that Conservatives
"oppose the idea of having an EU constitution"
total opposition to British
membership of the euro
Financial Times 12/2
2004
What odds would you like to give me that this Government
will actually veto the next step in the establishment of the European Union of
Mr Blair's dreams?
Janet Daley, Daily
Telegraph 26/11 2003
Highly recommended
Britain is ready to veto proposals for a new constitution
for the European Union rather than give up vital national powers over defence,
foreign policy and taxation.
Daily Telegraph
25/11 2003
Mr Brown's attack, launched in the Eurosceptic Daily
Telegraph, coincided with yesterday's Guardian report that Mr Blair has
rejected three requests for the chancellor to be given one of the three
government places in Labour's National Executive Committee.
Guardian 6/11 2003
Brown the sceptic blasts EU federalism
The Chancellor
writes exclusively in The Daily Telegraph on why Europe must learn from
Britain's economy
Gordon Brown has raised the stakes in the battle over
a new European constitution by demanding categorical assurances that it will
not lead to the harmonisation of taxes and a federal European state. Returning
to the political front line after two weeks paternity leave, the Chancellor
exposes a growing rift between the Treasury and No 10 over the importance of
the proposed constitution for a 25-member European Union.
Daily Telegraph 5/11 2003
Gordon Brown, British finance minister, on Tuesday
mounted a withering attack on the EU's economic record, claiming other member
states had to learn lessons from Britain.
Financial
Times 5/11 2003
Medan utrikesminister Jack Straw är
beredd att kalla Irak-kriget ett strategiskt misstag, fortsätter Blair att
försvara såväl alliansen med Bush-högern som det krig som
drivit Irak in i blodigt kaos.
Med det undergräver Blair
ytterligare sitt allt svagare förtroende hos allmänheten.
Förödande för hans planer att vinna allmänhetens stöd
exempelvis för medlemskap i EMU.
Premiärministerns avgång
rycker allt närmare.
Aftonbladet ledare 6/9 2003
Chancellor Gordon Brown has stressed that Britain will
adopt the European single currency only if his five tests for euro entry are
unambiguously met.
Despite his recent pledge to step up preparations
for euro entry, Mr Brown sounded a characteristic note of caution on the issue,
in his annual speech to banking and business leaders at London's Mansion House.
He said there would be "no short-cuts and no fudge" on the five tests for
whether the UK should adopt the single currency.
"To join in the wrong
way or on the wrong basis without rigorously ensuring the tests are met would
not be in the national economic interest. "And we will do nothing to put
stability, growth, or the funding of public services at risk," he said.
BBC 19/6
2003
Sun - 18 Jun 2003
Blair’s “love the euro”
campaign hit trouble last night as a new poll showed opposition is growing
— and trust in Brussels has collapsed. The EU’s own survey shows 63
per cent of Brits are against the single currency — up from 61 per cent
six months ago.
It revealed just 34 per cent trust the European Parliament
and only 32 per cent trust the European Court of Justice. Just 29 per cent have
faith in the Commission itself — the EU’s civil service.
And,
alarmingly for Mr Blair, support for our membership of the EU has fallen to 30
per cent.
Den brittiska misstron mot valutaunionen handlar i
grunden inte främst om de ekonomiska följderna. Bakom finns en stark
oro för att valutaunionen skall försvaga den parlamentariska
demokratin. Det är en oro som ibland tar sig oacceptabla och orimliga
nationalistiska uttryck men som likväl är fullt förståelig
och i grunden sympatisk.
Carl Tham, DN
Debatt 25/6 2003
It was never really about the
economics; even Tony Blair now tacitly admits it. For all the economese jargon,
the 18 volumes, the complex equations, the issue of the British and the euro is
really about who we are as a people.
What is neither honourable nor
consistent is the Prime Minister's position. On the one hand, he is travelling
around the country telling us that we face a vital choice about whether we are
in Europe at all; on the other, he tells us with a straight face that the EU
constitution is too small a matter to warrant a referendum. His stance is, in
the correct sense, incredible. There is only one way to settle this matter, and
that is to let the people decide.
Sunday
Telegraph editorial 15/6 2003
Euro or no, we will never be 'at the
heart of Europe'
It is not, of course, remotely surprising
that the European monetary union as we know it is fundamentally flawed since,
as is openly avowed by its continental promoters, its raison d'etre is not
economic but political. There is nothing remotely disreputable about this: what
is disreputable is to deny it.
Nigel Lawson,
Daily Telegraph 15/6 2003
It does not take a PhD in economics to understand the
essential issue in the euro debate:
Should ultimate responsibility for the
management of the British economy stay in Westminster or be transferred to
Frankfurt and Brussels?
The economic choice in joining the euro or staying
out is even clearer. If Britain keeps the pound, we must accept currency
movements. If we join the euro, swings in inflation, unemployment and wages
will potentially increase.
Anatole Kaletsky, The Times,
June 12, 2003
Economics and the Iraq war are turning Britain Inc.
against joining
John R. Pilling recalls a recent meeting of the
Confederation of British Industry, one of the country's most influential
business groups, in Birmingham. "Almost all those around the table were against
joining the euro," he says. "Three years ago, you would have had a very
different view."
Business
Week June 16 2003
"I've been wrong so far, so I don't have too much
confidence in my view. But I think within the next 10 to 15 years the eurozone
will split apart. The British government, on balance, should stay out of
it."
Milton
Friedman, Financial Times, June 06, 2003
Assessing the euro assessment
BBC 9/6
2003
All this means that the UK really has to meet just two
tests: convergence and flexibility. Once they are achieved, all other pieces of
the economic puzzle will fall into place.
But how does one recognise truly
converged and flexible economies?
The analysis of fiscal policy
within a currency union.
This responds to a genuine challenge: how to
reduce economic instability in member states when monetary policy is set for
the European Union as a whole.
The answer, it suggests, is to transform
fiscal policy.
The ideas are radical and, in the European context,
explosive.
Martin
Wolf, Financial Times June 11 2003
The report in question - Fiscal stabilisation and EMU
There was little surprise in Monday's
announcement that four of the five tests for euro entry had not been passed;
but there were two genuine shocks.
One lay in the specific reasons advanced
by the chancellor for his verdict, which make early British membership of the
currency union all but inconceivable. The second was the nature of the evidence
in the 18 supporting studies that convincingly undermined Mr Brown's assertion
that his decision was based purely on the economics of euro entry.
Mr Brown
thinks the country passes only one of the five tests
On the other four
tests, the chancellor awarded fails. But he also made clear that only two of
those tests matter.
One is whether there is sustainable and durable
economic convergence with the eurozone
The other is whether there is
sufficient flexibility in the economy to deal with problems that emerge when
convergence is incomplete.
Financial
Times editorial 10/6 2003
Never in human history can so many
have written so much for so small a result. After publishing 18 detailed
studies, plus a 246-page assessment, the Treasury's answer on UK membership of
the European single currency remains what it was in 1997: "not yet". It is a
warmer "not yet". But whether and when the UK will join remains obscure. The
most plausible conclusion is that it is not going to happen in the next few
years.The perfect result for a sceptical nation
Martin
Wolf, Financial Times June 10 2003
The postponement of a referendum was inevitable for two principal reasons.
One is the continuing unpopularity of the euro: public-opinion polls show that a majority currently wants to keep the pound. The government would be taking a big political risk in hoping to win a referendum in such circumstances and would be less inclined to take such a risk at the next general election—which must be held in 2006 at the latest—approached. The risk for Mr Blair personally would be even greater if it were widely assumed that his own chancellor remained opposed.
The second factor complicating life for Messrs Blair and Brown is the dismal economic outlook for much of the euro area.
The one-size-fits-all monetary policy needed in a currency area of twelve countries is inflicting particular damage on Germany, the biggest economy in Europe.
The European Central Bank is regarded with great
suspicion by those who do not like its secrecy or its sluggish response to the
economic downturn
The
Economist, June 9, 2003 good links
UK's euro decision
BBC, 9 June, 2003 good
links
Den 9 juni avger Storbritanniens regering sitt
utlåtande om huruvida landet uppfyller de fem kriterier för en
övergång till euron som satts upp av finansdepartementet. Det mesta
pekar på att beskedet blir "vänta och se".
Klas Eklund Kolumn SvD ledarsida 4/6
Ministers had gathered to hammer
out one of the biggest decisions of Tony Blair's premiership as they considered
the case for joining the single currency. The decision they reached will
not be made public until Monday, when Mr Brown will announce it in the Commons.
But it is understood the ministers accepted the chancellor's recommendation
that economically the time was not right.
BBC, 5 June,
2003 good links
Gordon Brown, den brittiske
finansministern, väntas inom kort förklara
att Storbritannien
inte är redo att gå med i EMU.
Gordon Brown har nu
låtit det brittiska finansdepartementet göra en ny studie (som
sägs omfatta över 2.500 sidor) av hur Storbritannien klarar de fem
testerna. Slutsatserna ska presenteras på annandag pingst, den 9 juni.
Dagens
Industri 21/5 2003
Gordon Brown har nu låtit det brittiska finansdepartementet göra en ny studie (som sägs omfatta över 2.500 sidor) av hur Storbritannien klarar de fem testerna. Slutsatserna ska presenteras på annandag pingst, den 9 juni.
Inför det brittiska tillkännagivandet har kampanjorganisationen Sverige i Europa låtit göra en studie i lite mindre format (18 sidor) av hur Sverige klarar de fem testerna.
"Vår analys ger vid handen att om man tillämpar de fem testerna på Sverige visar det sig att kraven över lag uppfyllts", heter det i rapporten, skriven av tre pr-konsulter på pr-byrån Hallvarsson & Halvarsson.
BRITAIN has become the No1 place for
foreign firms to invest since we decided to stay with the Pound. The UK is now
the most popular destination for inward investment, while countries using the
euro have seen their share of foreign cash nosedive. Britain has now
outstripped France as the European base for manufacturing.
www.no-euro.com
4/6 2003
European Commissioner and former Conservative cabinet minister Chris Patten has made a scathing attack on the prime minister's approach to joining the euro.
The government is due to announce by 7 June whether or not it will hold a referendum on the single European currency.
Mr Patten is accusing the prime minister of failing to show
leadership on the euro debate and failing to exert his authority over
Chancellor Gordon Brown.
BBC 14 May,
2003
Storbritannien väntas snart fatta beslut om att
fortsätta vänta och se, hur påverkar det Sverige?
"De
har ändå en annan ställning internationellt. De har ett
oerhört nära samarbete med USA, till exempel. Den möjligheten
har inte Sverige."
Blir läget ett annat om Storbritannien
går med?
"Det spelar ingen större roll. Det är inte med
Storbritannien utan med euroländerna som vi har 40 procent av vår
utrikeshandel."
Anna Lindh intervjuad i DI
14/5 2003
Blair must ensure 'not yet' does not mean 'never'
The PM must prevent Brown staging another fait accompli on the euro If
Tony Blair really wants to take Britain into the euro while he is Prime
Minister, he needs a strategy for entry. At present, he is tied to a strategy
for indefinite delay. Mr Blair surrendered the initiative in October 1997 when
he gave Gordon Brown control over the assessment.
Peter
Riddell, The Times 8/5 2003
Hubert Fromlet:
”Vid en fastighetskrasch kan det anses mycket värdefullt
för ett land att självt kunna reglera räntan”.
Min
uppfattning är att vi i Sverige inte har förstått vilken roll
vår folkomröstning har i Storbritannien"
Dagens Industri, 24/2 2003
By the first week of June, Gordon Brown, the
chancellor of the exchequer, must announce the results of the most
comprehensive study the Treasury has ever made of a single decision: whether or
not Britain should join the euro.
His answer will be: not yet.
This
will make it virtually impossible to join the euro before the next election,
which will probably be in 2005
Five tests and a funeral
The Economist 1/5 2003
Britain must avoid Germany's mistake
By Martin
Feldstein
Published: April 21 2003
19:11
A different view of euro-sclerosis
The main arguments against the UK's joining the euro relate to the positive
advantages of a floating exchange rate; and it is on this that UK
euro-opponents should concentrate.
By Samuel Brittan, Financial Times, February 28
2003
Should Britain
Join The Euro?: The Chancellor's Five Tests Examined
Patrick Minford, 9
September 2002
Institute of Economic Affairs,
Britain would be mad to join the euro
By Martin Taylor, Financial Times, Published: November 12 2002
The writer is chairman of
W.H. Smith. These are his
personal views
THE UNITED
KINGDOM, THE EU AND THE WORLD
Sir Oliver Wright, former UK Ambassador to
Washington
With a budget deficit of 3.2 per
cent of gross domestic product, under the EU measure, Britain is in no position
to lecture anybody
The decision to join an economic and monetary union is
profoundly, if not exclusively, political
Wolfgang Munchau, Financial
Times, March 18 2004
With a budget deficit of 3.2 per cent of gross domestic product, under the EU measure, Britain is in no position to lecture anybody on avoiding pro-cyclical fiscal behaviour, especially at a time of strong economic growth.
In retrospect, it is clear that four years ago Germany, France and Italy were all running excessive deficits, given the state of the economic cycle. Few economic commentators criticised those countries' fiscal policy at the time.
Their finance ministers never intended to run pro-cyclical policies. They misread the economic cycle, which turned down earlier and faster than they had expected. They also misjudged the effect of the global cyclical downturn on their own growth rates, and in turn they misjudged the effect of lower economic growth on their budget deficits.
The UK is potentially in a similar situation today. The chancellor may still be right about his forecasts, which show the public sector borrowing requirement levelling off in later years and annual economic growth rates of between 3 and 3.5 per cent in 2004 and 2005. But then again, he may be wrong, just as his European colleagues were. Given the combination of unsustainable twin deficits in the US, the prospect of a further fall in the dollar against the euro, monetary tightening worldwide and the threat of terrorist attacks in continental Europe and the UK, such forecasts should be treated with more caution than usual. If the forecasts turn out to be wrong, the UK's present budgetary stance may be judged by economic historians of the future to be as inappropriate as the eurozone's fiscal policy of 2000 turned out to be.
The decision to join an economic and monetary union is profoundly, if not exclusively, political. The politics have been moving against membership for some time. The government maintains, at least officially, that it still seeks membership of the euro, once the economic conditions are right. If this were a credible proposition, one would at the very least expect a fiscal policy that was consistent with this goal.
The five tests:
if Gordon Brown says 'no' to the euro now, can Britain say 'yes' in a few years' time?
Financial Times May 03, 2003
In its first assessment of the five tests in 1997 the Treasury described "sustained and durable convergence" as the "touchstone" of the decision. The central question is whether Britain can live comfortably with the "one-size-fits-all" single interest rate for the eurozone. The more likely it is that Britain will behave differently from the economies of continental Europe, the more it needs to retain control of an independent monetary policy.
A country with economic difficulties, such as Germany, is prevented from setting its own interest rate or letting its currency devalue to stimulate growth. All it can do is run an inflation rate lower than those of the other members of the monetary union, to bring about a fall in its real exchange rate. The less painfully that can be done, the better.
Storbritannien är fortfarande inte
redo att närma sig euron och kommer inte att göra det före
nästa val. Det slog finansminister Gordon Brown fast när han på
torsdagen presenterade sin nya budget
DN 17/3 2004
Däremot vill Brown ändra på EMU:s stabilitetspakt.
I juni i fjol konstaterade finansminister Brown att
Storbritannien inte var klart för eurointräde: bara två av de
fem krav han satt upp för ett brittiskt euromedlemskap hade uppfyllts.
http://news.bbc.co.uk/2/hi/business/3001694.stm
Han lovade dock att uppdatera och ompröva sin utvärdering i en senare budgetproposition. Men i går såg inte Gordon Brown någon anledning att ompröva förra sommarens bedömning.
På de nio månader som gått har avståndet mellan euroområdets resultat och den brittiska ekonomin ökat ytterligare: Storbritannien hade förra året 2,3 procents tillväxt, att jämföra med euroländernas 0,4 procent i snitt. En annan orsak är förstås britternas alltjämt ökande skepsis mot den gemensamma europeiska valutan.
Gårdagens besked innebär att den sittande regeringen knappast kommer att närma sig euron före nästa val, som väntas utlysas till våren 2005. Däremot lovade Gordon Brown att från nästa år årligen uppdatera sin utvärdering.
Blair's big failure on Europe
Joining the euro was the essential emblem - it was the mission for Mr Blair's
second term.
The dream has died.
Philip
Stephens, Financial Times 24/2 2004
The dream has died. For many years visitors to Tony Blair's Downing Street were struck by the fervour of his commitment to Britain's European destiny. After decades of resentful hesitation and arrogant ambivalence, the nation would take its rightful place in the European Union. Joining the euro was the essential emblem of this transformation. It was the mission, too, for Mr Blair's second term.
Raise the issue now and the prime minister will respond with a shrug, likely as not.
Had he not always said that, whatever the political imperatives, the economics too had to be right? Anyway the world has changed. The concerns (he used to share them) that Britain would drift to the margins of influence have proved unfounded. Slow economic growth and the collapse of the stability pact have robbed the euro of its magic. Iraq divided Europe and showed that the Franco-German motor now lacks the power to shape the continent's future.
Mr Blair's about-turn (some would say his reconnection with political reality) has put a smile on the face of Gordon Brown.
Göran Perssons politiska år förmörkades av
den väldiga förlusten i folkomröstningen om euron "som ju i sitt
slag är utan motstycke".
Intervju i DN 20/12
2003
Michael Howard, the Conservative leader,
drew two ineradicable lines in the sand on Thursday
he said that
Conservatives "oppose the idea of having an EU constitution"
total
opposition to British membership of the euro
Financial Times 12/2
2004
In his first important speech on Europe since becoming leader three months ago, Mr Howard sounded a much tougher note on the euro and the European constitution than the government has done. But pro-European Conservatives nevertheless greeted it as an important indication that Mr Howard had embarked on a process of "constructive engagement" with the EU and the party's centre-right European allies after years of estrangement.
Mr Howard drew two ineradicable lines in the sand on Thursday.
Speaking in Berlin, he said that Conservatives "oppose the idea of having
an EU constitution"
while in an interview with the FT ahead of the speech
he asserted his total opposition to British membership of the euro. "We
wouldn't join the euro while I was prime minister," he said.
The thrust of Mr Howard's speech was his belief that EU member states should be left to choose among themselves whether or not to integrate in any specific area.
"That flexible approach, variable geometry, would ensure that we create a 'made to measure' Europe in which the institutional arrangements comfortably fit national interests, not an 'off the peg' Europe, ill-fitting and splitting at the seams." Mr Howard was careful to stress that his commitment to a more flexible Europe was one he had espoused for more than a decade and did not amount to a shift from Mr Duncan Smith's line.
Adopting a stance that is not dissimilar to that of Gordon Brown, the chancellor, Mr Howard argued that the important thing was for Europe to boost its competitiveness rather than its institutional arrangements.
He also made clear that, while he is opposed to a constitution, he accepts the need to reform the European Council, which brings together the various heads of government. "Are there ways in which you might desirably reform the council? Yes. Do you need a constitution for that? No. You can agree changes to the council as has already been done without a constitution," he said.
Mr Brown's attack, launched in the
Eurosceptic Daily Telegraph, coincided with yesterday's Guardian report that Mr
Blair has rejected three requests for the chancellor to be given one of the
three government places in Labour's National Executive Committee.
Guardian
6/11 2003
Though some Blair loyalists said it was merely "more of Gordon's constant second-term theme", others claim the European row - linked to the simmering dispute about Mr Brown's status in the NEC - is part of a worsening struggle between Mr Blair and Mr Brown. The chancellor's "Real Labour" speech at Labour's Bournemouth conference delighted activists but offended some MPs - and Mr Blair - by appearing disloyal to the modernising project that the two men have sustained for a decade.
The chancellor's assault is also at odds with recent tentative efforts by the Foreign Office to restore the Franco-German alliance after the Iraq war. One minister said the triple initiative by British, German and French foreign ministers on Iran had "transformed the atmosphere". France is still seeking to persuade Mr Blair that his close relationship with the US is producing few quantifiable results, and that focused cooperation between the three countries can create an EU "motor". France and Germany insist they are willing to make concessions over their plans for a stronger EU defence force, including on a separate EU military planning headquarters outside Nato.
Brown the sceptic blasts EU
federalism
The Chancellor writes exclusively in The Daily Telegraph on why
Europe must learn from Britain's economy
Gordon Brown has raised the
stakes in the battle over a new European constitution by demanding categorical
assurances that it will not lead to the harmonisation of taxes and a federal
European state. Returning to the political front line after two weeks paternity
leave, the Chancellor exposes a growing rift between the Treasury and No 10
over the importance of the proposed constitution for a 25-member European
Union.
Daily Telegraph 5/11 2003
Writing in The Telegraph today Mr Brown calls on EU leaders explicitly to reject "grandiose schemes" for harmonising corporate and other taxes and back Britain's plans for tax competition. He says the EU must abandon "old flawed assumptions that a single market should lead inexorably to tax harmonisation, fiscal federalism and then a federal state".
Mr Brown calls on EU leaders to remove "ambiguities" from the draft constitution that could undermine the role of national governments in economic decision-making. His decision to draw attention to concerns over the implications of the constitution is in sharp contrast to repeated assurances from Tony Blair that it will not threaten Britain's ability to set its own taxes or change fundamentally this country's constitutional relationship with the EU. The Chancellor's language, particularly raising the spectre of a slide towards a "federal state", has strong eurosceptic overtones.
Flexibility, not federalism, is key to this competitive new
world
By
Gordon Brown, Daily Telegraph 5/11 2003
My contention is that to move from trade bloc Europe to global Europe, we must explicitly reject old flawed assumptions that a single market should lead inexorably to tax harmonisation, fiscal federalism and then a federal state. Indeed it is by Britain standing up resolutely for British ideas whose time has come – our commitment to long-term fiscal rules, flexibility, openness and free trade – that we not only secure British interests but equip Europe for global competition.
Gordon Brown, British finance minister, on
Tuesday mounted a withering attack on the EU's economic record, claiming other
member states had to learn lessons from Britain.
Financial Times 5/11
2003
Mr Brown, in Brussels for the monthly Ecofin meeting of finance ministers, gave little sign that he could contemplate Britain joining the euro in the near future. He said the 12-country eurozone's fiscal and monetary frameworks were inferior to those in Britain and scorned its record on growth and job creation. "I think that increasingly people in Europe are looking at a British framework for stability and economic reform," he said at a press conference.
Mr Brown's aides said his comments were "pro-European" since they showed Britain was able to bring positive ideas to the EU. But his increasingly strident comments and advocacy of what the French call "Anglo-Saxon" capitalism have caused irritation in the European Commission and in other national capitals.
He rejected any moves to dilute national vetoes on taxation, saying: "The old road going from single market to single currency through tax harmonisation to a federal fiscal policy won't yield the success we want to see."
Mr Brown said Britain provided a model for the rest of the EU, with unemployment of 4.5 per cent roughly half the EU average, low debt, and economic growth in every quarter since he became chancellor in 1997.
He criticised the EU's stability and growth pact - the subject of more rancour at Wednesday's meeting - as being a seriously flawed fiscal framework which failed to focus on medium term growth.
And he claimed the European Central Bank, with its concentration on keeping inflation below 2 per cent, was unable to provide the monetary conditions for growth in the EU. He said the Bank of England's symmetrical inflation target - which is as concerned with deflation as with inflation - had allowed it to cut interest rates "much more aggressively". Mr Brown said that in the current cycle the US had cut rates 11 times, the UK 10 times and the ECB just seven times. "At the end of the day people have to ask themselves why Europe has grown so slowly over the last few years," he said.
FRONT
PAGE - FIRST SECTION:
Blair to rule out early referendum on entry to
euro
By Cathy Newman, Chief Political Correspondent Financial Times;
Apr 24, 2003
Tony Blair has agreed to rule out an early referendum on British entry to the euro after Gordon Brown insisted this week that the Treasury's five economic tests point to a decisive no. The chancellor flew on Tuesday from his Scottish constituency to Chequers, the prime minister's country residence, to try to thrash out a deal on the issue that has become a running sore between the two men. Mr Blair, who had already privately ruled out a referendum this year, is still determined to keep open the option of joining the single currency later in this parliament. But the chancellor's downbeat assessment of his five economic tests also makes a referendum next year look highly unlikely.
/Englands finansminister/ Gordon Brown left it to MPs to infer
that
there was no compelling case for joining the euro in a hurry
The Economist 10/4 2003
Reports on Tuesday said Chancellor Gordon
Brown had been pressing for clearance to deliver his verdict on the currency
during his Budget statement. The suggestion prompted speculation that the
government is set to say the UK is not yet ready to join the euro.
BBC 8/4
2003
"The prime minister and the chancellor both agreed without dispute that there could be no question of doing the assessment in the Budget at the height of the Iraqi conflict."
Gordon Brown seems to be winning his fight to put
off a euro referendum
The Economist print 27/2
2003
Tony Blair has signalled that a
European summit in March will be a key factor in whether the UK votes this year
on whether to join the euro single currency.
BBC 18/2
2003
European clash over UK spending plans
Financial Times
February 18 2003 20:57
Gordon Brown, UK finance minister, on Tuesday clashed with EU colleagues over his spending plans, providing more ammunition for British opponents of joining the euro. Some ministers implied Mr Brown should raise taxes or trim his programme to rebuild Britain's public services, because he risked breaching the EU's budget rules. The chancellor left the meeting early. His aides made it clear he had no intention of heeding the warnings.
Opponents of the euro are likely to use the dispute as proof that Britain's fiscal room for manoeuvre could be limited inside the single currency zone.
Den mer allmänna spådomen
är att en
brittisk folkomröstning ligger flera år bort i
tiden.
Ekot 3/1 2003
Efter att den danske statsministern antytt att Danmark kan komma att hålla en ny folkomröstning om Euron 2004 eller 2005, har trycket ökat på Storbritannien, som kan bli det enda EU-landet utanför EMU.
Premiärminister Tony Blair beskrev i sitt nyårsbudskap till britterna årets beslut om euron som det viktigaste enskilda beslutet på en generation, och det är väl känt att Blair vill gå till historien som den som förde Storbritannien fullt ut in i Europa. Men den allmänna bedömningen är att när den avgörande dagen kommer i juni så kommer den brittiska regeringen att säga att de ekonomiska kriterier den har satt upp som villkor för att rekommendera ett brittiskt inträde i valutaunionen ”inte ännu” har uppfyllts.
Bindningen till de ekonomiska villkoren, till att en anslutning till euron skall vara klart och otvetydigt bra för den brittiska ekonomin, gjorde labourregeringen för fem år sedan och makten över beslutet ligger hos finansminister Gordon Brown, som till skillnad från Blair anses känna djup skepsis inför en brittisk övergång till euron och vilja vänta.
Den svenska folkomröstningen i år och de danska antydningarna om en ny folkomröstning kanske redan nästa år sätter press på Blair, som inte vill se Storbritannien isolerat och ensamt kvar utanför EMU. Men han kan knappast ta risken av en folkomröstning utan sin mäktige finansministers stöd och med en än så länge negativ väljaropinion.
Bland brittiska euroanhängare finns de som tror att vägen till euron kan gå via Bagdad – att ett brittiskt deltagande i ett snabbt och relativt oblodigt störtande av Saddam Hussein skulle stärka Blair till den grad att han skulle kunna ta den politiska risken av en folkomröstning redan i höst. Men den mer allmänna spådomen är att en brittisk folkomröstning ligger flera år bort i tiden.
Blair must ensure 'not yet' does not mean
'never'
The PM must prevent Brown staging another fait accompli on the
euro If Tony Blair really wants to take Britain into the euro while he is Prime
Minister, he needs a strategy for entry. At present, he is tied to a strategy
for indefinite delay. Mr Blair surrendered the initiative in October 1997 when
he gave Gordon Brown control over the assessment.
Peter Riddell, The
Times 8/5 2003
The Chancellor often points out that more work has been done on the assessment than on any previous economic decision. But outsiders will not see the 18 background studies until Mr Brown makes his Commons statement this month. The 2,000 pages of analysis will underpin a fait accompli rather than promote open debate. How many trees will have to be cut down? As Randolph Churchill said of an earlier “prudent” Chancellor: “The forest laments in order that Mr Gladstone may perspire.”
No one disputes that the economics is crucial. Ed Balls, the Treasury’s chief economic adviser, delivered a weighty lecture last autumn on the damage done in the past when far-reaching economic decisions were taken for immediate political reasons, ranging from the return to the Gold Standard in 1925 to the ill-fated entry into the European Monetary System in 1990.
He was right. Going in at the wrong exchange rate, or when the economies are out of sync, would obviously be a mistake.
There are strong arguments against entry now: notably, the sluggish state of the German and other eurozone economies, and the over-rigid limits on borrowing in the stability and growth pact. These issues leave aside political factors such as the bitter divisions within the EU over the Iraq war, which would make it very hard to win a referendum in the short term.
Some sceptics have seen Mr Blair’s willingness to shift responsibility, and blame, to the Treasury as a convenient cloak for his own reluctance to face such a controversial decision. Even if partly right in the first term, this is no longer true: hence Mr Blair’s anguished talks with Mr Brown to ensure that the Commons statement has a pro-euro gloss.
But even if, at Mr Blair’s insistence, Mr Brown does not formally rule out a further review, and a referendum, later this Parliament, few will take this seriously on its own. The “not yet” assessment will be widely, and rightly, seen as “no for a long time” unless Mr Blair produces a convincing timetable and date for entry.
Den 9 juni avger Storbritanniens regering
sitt utlåtande om huruvida landet uppfyller de fem kriterier för en
övergång till euron som satts upp av finansdepartementet. Det mesta
pekar på att beskedet blir "vänta och se".
Klas Eklund
Kolumn SvD ledarsida 4/6
Beskedet blir att Storbritannien på sikt ska gå in i unionen, att man snart är redo, men att det finns vissa övergångsproblem som först måste lösas. Dörren till en folkomröstning före nästa parlamentsval (som ska äga rum senast våren 2006) kommer att hållas öppen. Det andra skälet är ekonomiskt. Även om jag tycker att de fem kriterierna (konvergens, flexibilitet, möjligheten att behålla London som finanscentrum med flera) i stort sett är uppfyllda, kan man inte neka till att Storbritannien har en knepigare övergångsproblematik än vad både Danmark och Sverige har.
Storbritanniens ekonomi är inte lika väl i fas med valutaunionen som Sveriges. Den brittiska ekonomin visar just nu vissa överhettningssymtom, inte minst på husmarknaden, där priserna har rakat i höjden under senare år. Samtidigt är räntorna klart högre än i Tyskland, och budgetunderskottet växer. Det finns faktiskt en risk att underskottet nästa år slår i stabilitetspaktens tak, d v s tre procent av BNP. Att i det läget snabbt gå in i valutaunionen kan medföra risker. Om de brittiska räntorna ska sänkas ned mot den tyska nivån kan överhettningsproblemen på fastighetsmarknaden skärpas. Finanspolitiken skulle i det läget behöva stramas åt med kraft - men det kolliderar med det existerande utgiftsprogrammet och ambitiösa planer inte minst för utbyggnad av infrastrukturen.
Om den politiska kompromissen mellan Blair och Gordon Brown blir den jag tror, hålls dörren öppen för en folkomröstning under 2004 eller 2005. Eftersom pundet - till skillnad från kronan - är en världsvaluta, lär britterna efter en omröstning inte behöva stå två år i väntrummet ERM, d v s med fast kurs mot euron. Med en kort ERM-period finns därmed faktiskt fortfarande möjligheten för Storbritannien att gå med i unionen någon gång 2006-2007, även om beskedet den 9 juni blir "vänta och se".
Vänta och se - Full text - Buffertfonder och villapriser
Euro or no, we will never be 'at the heart
of Europe'
Nigel Lawson, Daily Telegraph 15/6 2003
Lord Lawson was the Chancellor of the Exchequer from 1983 to 1989.
As Prof Wilhelm Nolling, the distinguished former Bundesbank director, pointed out in this newspaper last week, for Germany in particular - the euro-zone's largest economy - the strait-jacket of a one-size-fits-all monetary policy has been unequivocally harmful.
Mr Brown did, however, offer a clue about what is fundamentally wrong with the European monetary union when he quite rightly stated that "it is important to learn the lessons not just from the experience of the euro area but also from how the states and regions adjust successfully in the United States monetary union".
And so far as the United States is concerned the lessons are
clear. Three absolutely crucial conditions are satisfied. First, there is a
very high degree of labour mobility: Americans are prepared to move long
distances, within the union, to find work.
Second, there is a high degree
of labour market flexibility, allowing wages to move down as well as up.
And third, as a result of a genuinely federal system of taxation and public
expenditure, substantial sums of money are automatically transferred from the
more prosperous to the less prosperous parts of the union.
Not only does the European monetary union satisfy none of these conditions, but the first could fully be achieved only if the union were bound together by a common language, the second is a feature of the "brutal" Anglo-Saxon economic model which the "civilised" European social model explicitly rejects, while the third is the characteristic of a single federal state.
It is not, of course, remotely surprising that the European monetary union as we know it is fundamentally flawed since, as is openly avowed by its continental promoters, its raison d'etre is not economic but political. There is nothing remotely disreputable about this: what is disreputable is to deny it.
Mr Blair's seldom-articulated reason for so obsessively wishing to see the UK sign up to the euro is also political rather than economic. He appears to believe that, once inside EMU, we could exert a decisive influence over Europe's role in world affairs that would be unattainable outside it. It is, however, a motivation that is implausible to the point of incoherence. In the first place, just as we have always been anxious to exclude France and Germany - particularly France - from the intimacy of the Anglo-American special relationship, so they have no wish to see Britain complicate the Franco-German special relationship by turning it into an uneasy menage a trois.
Utskriftsvänlig version av detta referat
It does not take a PhD in economics to
understand the essential issue in the euro debate:
Should ultimate
responsibility for the management of the British economy stay in Westminster or
be transferred to Frankfurt and Brussels?
The economic choice in joining
the euro or staying out is even clearer. If Britain keeps the pound, we must
accept currency movements. If we join the euro, swings in inflation,
unemployment and wages will potentially increase.
Anatole Kaletsky, The
Times, June 12, 2003
Patriotism is the last refuge of the scoundrel said Dr Johnson. As a rootless cosmopolitan, whose family has held five passports in 50 years, I fully agree; which is why I have always been reluctant to bandy grandiloquent phrases about sovereignty, democracy and national independence while discussing the euro.
But Tony Blair and Gordon Brown have changed the terms of the debate. At Tuesday’s press conference, they declared that their top priority was now to persuade the British public of “the patriotic case for the euro”. If that is so, patriotism, sovereignty and democracy must become core arguments for everyone who wants to make a contribution to this great national debate.
In many ways, this is a welcome liberation. It will discredit, once and for all, the fiction Mr Blair has used to insulate himself from the euro controversy so far — the idea that euro membership is a technical economic issue, best left to Treasury experts and insulated from the cut and thrust of political emotions.
As a result of Mr Blair’s decision to present the euro in terms of “patriotism”, the British people might finally get genuinely involved in this debate. And once they do, the debate will swing even more decisively towards the anti-euro camp.
For not only is the debate now officially about patriotism, sovereignty and democracy. We also have an official government estimate of how much these qualities are worth. The Treasury has stated that the maximum possible economic benefit to Britain from joining the euro would be 0.25 per cent of GDP or £3 billion a year. When divided by Britain’s population of about 60 million, this is equivalent to £50 a year or £1 a week. Is this the price Mr Blair puts on Britain’s economic sovereignty and democratic accountability?
The euro lobby may cry foul about my use of the figures. They point out that the possible gains suggested by the Treasury studies are cumulative. Membership of the euro could add 0.25 per cent to Britain’s annual growth rate not just for one year, but for as many as 30 years.
It is perfectly true that the Treasury says this, but it also points out that the gain of 0.25 per cent annually is the maximum gain imaginable under the most favourable possible conditions. It is equally possible, in the Treasury’s judgment that the maximum gain from joining the euro could be as little as 0.02 per cent of GDP — equivalent to just 10p a week. And even such a tiny gain would be dependent on absolute certainty that the British economy had converged fully, that the exchange rate chosen was the right one, and that all the improvements in flexibility and all the reforms to the eurozone’s management systems suggested by Mr Brown had been put in place.
Economists could, of course, argue until the cows come home about the precise figures and all the assumptions the Treasury has made — for example, that Britain suffers no permanent costs from the abandonment of domestic economic management and the resulting volatility of prices and employment. What really matters, however, is the political impact of quantifying the euro’s economic effects.
It does not take a PhD in economics to understand the essential issue in the euro debate: Should ultimate responsibility for the management of the British economy stay in Westminster or be transferred to Frankfurt and Brussels? This is essentially the only question that has to be answered in the euro debate. The difficulty, of course, is that costs and benefits exist on both sides.
The political choice is really quite straightforward. If Britain keeps the pound, our Government is excluded from decisions on the euro and risks a broader loss of influence, at least according to Mr Blair. If Britain joins the euro, our Government loses control over the key levers of economic management; as a result, British politicians and officials can no longer be held to account for the way the economy performs.
The economic choice in joining the euro or staying out is even clearer. If Britain keeps the pound, we must accept currency movements. If we join the euro, swings in inflation, unemployment and wages will potentially increase.
Presented with the political choice, most people in Britain would undoubtedly vote to keep national sovereignty and democratic control, even if this meant losing some influence in Europe. Until this week, however, the europhiles were able to avoid inevitable defeat on the politics of the euro issue by focusing instead on the economic effects — either claiming enormous benefits from joining the euro or warning of cataclysmic economic damage if Britain stayed out.
Because of the Treasury assessment, the euro lobby has now lost this line of defence. It doesn’t matter how many pro-euro businessmen threaten to pull out of Britain or stop inward investment, if the British people say “no” or the Government keeps postponing a referendum. The Treasury’s range of figures take inward investment and currency exchange costs, and all the other economic effects of the euro, into account.
In doing this, they draw attention to the underlying economic truth that has all too often been lost in the euro debate. Exchange costs, inward investment and all the other supposed economic effects of joining the euro are not ends in themselves. They only benefit the economy if they increase economic growth. And the evidence — or even the theoretical conjectures — about how joining the euro might boost Britain’s growth rate suggests only tiny, almost invisible effects.
Where, then, does this leave Mr Blair’s campaign to persuade the British public of the “patriotic case for the euro”? The answer is back squarely in the realm of politics.
Mr Blair wants to engage the sceptics over what he sees as Britain’s political destiny to join the euro, and anyone who meets him is left in no doubt that he really is spoiling for this fight.
While he still insists rather mechanically, that the euro is essentially an economic issue, he no longer tries to hide behind the Treasury assessment. His personal definition of Britain’s “national economic interest” now stretches deep into the realms of diplomacy, geopolitics and historical destiny, which are completely out of bounds to Treasury bean-counters, with their cost-benefit analyses, flexibility agendas and convergence roadmaps.
This is a little-noticed, but enormously important, change in the Government’s policy. In 1997, when the “five tests” were invented, the Government’s position was that joining the euro would be a politically unpopular and painful decision that might be necessary for Britain because of the overwhelming economic benefits of the single currency. Now the relationship between politics and economics has been reversed. We must now join because of the “overwhelming political benefits” (a phrase Mr Blair now habitually uses in his speeches), provided membership does not entail significant economic costs. The purpose of the Treasury assessment is no longer to prove that Britain will gain economically from the euro. It is to make sure that the British economy is not wrecked by joining on the wrong terms or at the wrong time.
Mr Blair no longer even pretends that the positive case for joining will be made in the narrow financial terms defined by the five tests. Instead, he talks of the huge economic benefits for Britain of having more influence in Europe and of claiming its seats on the committee of eurozone finance ministers and the European Central Bank.
If that is the essence of the patriotic case he proposes to make for the euro, good luck to him. British voters will laugh him out of court.
By the first week of June,
Gordon Brown, the chancellor of the exchequer, must announce the results of the
most comprehensive study the Treasury has ever made of a single decision:
whether or not Britain should join the euro.
His answer will be: not yet.
This will make it virtually impossible to join the euro before the next
election, which will probably be in 2005
Five tests and a funeral
The Economist 1/5 2003
The Treasury's analysis has spawned 18 supporting
studies and will run to 2,000 pages. But at its heart are five tests, which Mr
Brown first set in October 1997.
Are business cycles and economic
structures compatible so that Britain can live permanently with euro interest
rates?
If problems emerge is there sufficient flexibility to deal with
them?
Would joining the euro encourage investment?
How would the City
of London be affected if Britain joined the euro?
Finally, will joining the
euro promote higher growth, stability and a lasting increase in jobs?
The house-price boom of recent years has highlighted a fault line between Britain and the euro area. A house-price bust could weaken demand. As long as Britain retains its own currency, the Bank of England can respond with lower interest rates. A Europe-wide interest rate would make that impossible. Mr Brown revealed in last month's budget that he is looking for ways to make housing finance less reliant on short-term floating-rate mortgages and so less vulnerable to short-term interest rates, which suggests he thinks that Britain has not yet achieved the goal of “sustainable and durable” convergence.
Vänta och se - Full text - Buffertfonder och villapriser
Gordon Brown seems to be winning
his fight to put off a euro referendum
The Economist print 27/2
2003
One of the side-effects of a quick victory, it is suggested in Downing Street, could be to strengthen Mr Blair and thus make it likelier that a referendum could be held during this parliament. But, with the deadline for Gordon Brown's judgment on his famous five tests only three months away—and the announcement may come sooner—economics are pushing in the opposite direction.
The Treasury's tests ask: how convergent the economy is with the euro area, whether it is flexible enough to lose the shock absorber of its own exchange rate, what would happen to investment, how the City would be affected, and what the overall impact would be on jobs and prosperity. But two simple questions lie at the heart of the matter. Would the economy perform better within the euro area? And could it cope with interest rates set by the European Central Bank (ECB) and fiscal policy governed by European rules?
The Treasury is particularly worried that many European labour markets are still too inflexible. Anyway, even if the economies are converging, Britain would not necessarily benefit from having its interest rates set by the ECB. If house prices—which have been rising far faster than those in the rest of Europe—crashed, Britain might then need lower interest rates than in the euro area.
Mr Brown also dislikes the stability pact, under which countries are supposed to try to balance their budgets and can face fines if deficits exceed 3% of GDP. This has forced, for instance, Germany and Portugal to tighten fiscal policy instead of easing it to help their limping economies. Britain, which has low public debts but needs to borrow to rebuild its infrastructure, could find its freedom to do so constrained by this fiscal straitjacket.
Choosing the right exchange rate to join at is not, formally, one of the tests; but everybody knows it is crucial. If too high a rate is chosen, Britain would have to endure a long period of slower growth to make its wages and prices more competitive. One reason why Germany's economy is in such a mess is that it entered the euro at too high a rate.
On balance then, the Treasury is likely to judge that the risks of joining the euro are too serious to contemplate early membership. That will be frustrating for the prime minister. So there is likely to be a face-saving formula which will leave open the door for a possible referendum in 2004. It will only be notionally ajar. A referendum looks likelier in Labour's third rather than second term of office. Klicka här för full text
"I över fem år har finansminister Gordon Browns underlydande utrett om de ekonomiska villkor regeringen satt upp för EMU-medlemskap är uppfyllda. Premiärminister Tony Blair vill att Storbritannien ska skrota pundet, men bara om det ekonomiska läget är det rätta. Och det är det inte just nu, enligt finansdepartementets slutsatser", skriver Sunday Telegraph.(DN 14/3 003)
/Englands finansminister/ Gordon Brown
left it to MPs to infer that
there was no compelling case for joining the
euro in a hurry
The Economist 10/4 2003
Gordon Brown implied what the outcome of the assessment would be. Helpfully, he pointed out that long-term interest rates were now below those of the euro area. He drew attention to the fact that the unemployment rate in Britain was 5% whereas it was 9% in the single-currency zone. And he highlighted the fact that the British economy had grown over the past two years at roughly double the rate of the euro area. Looking ahead, “the largest repercussions” for the British economy arose from the fall in growth prospects for the euro area to around 1% in 2003.
Mr Brown left it to MPs to infer that there was no compelling case for joining the euro in a hurry.
And he hinted that Britain's volatile housing market could prove at least a temporary barrier to a euro referendum. He announced a new study to examine how Britain could develop a long-term fixed-rate mortgage market and so wean itself off the ever-popular short-term floating-rate loan. Floating-rate loans make the housing market and the economy unusually responsive to short-term interest rates—which is a problem if they are to be set at European, not national, level.
Mr Brown also implied that Britain would fail the second of his famous five euro-tests: “if problems emerge is there sufficient flexibility to deal with them?” The rationale for this requirement is that national economies in a single-currency area can no longer adjust to shocks by changing interest rates.
Should Britain
Join The Euro?: The Chancellor's Five Tests Examined
Patrick Minford, 9
September 2002 Institute of Economic Affairs,
Britain would be mad to join the euro
By
Martin Taylor, Financial Times, Published: November 12 2002
The writer is chairman of
W.H. Smith. These are his
personal views
Britain's European policies rest on two misapprehensions. Taken together, they lead us into all kinds of danger, yet still we do not abandon them. Perhaps the parlous state of Europe may open even our apologetic eyes and change the way we handle European affairs.
The first misapprehension is the idea that other countries, particularly France and Germany, are our "partners" - a weasel word used in business by people who want to take advantage of you. In fact, in the inter-governmental model, they are our allies and rivals. The second is that Britain must placate them. The inconsistency is clear: were they partners, we should not need to placate them; since they are rivals, we should rarely try.
The reality is that the European Union has shown itself not so much resistant to economic reform as utterly unreformable, even as evidence of peril mounts. The malign grip of French state employees continues to keep what should be the richest country in Europe operating well below its potential. The Commission is weak and blunder-prone. The bear market in equities threatens to defer by a generation a market solution to the pensions time-bomb. And the German economic crisis deepens by the day.
Such revenge is available in the timing of British entry to the euro. I made a speech five years ago, saying that I thought it would be tough to make the euro work because of the rigidity of continental economies. I also said that Britain should not join, partly because its economy differed substantially from other EU members, and partly because the early years of the euro would be tough until the eurozone economies reformed or the system blew up.
The problems remain where they always were, at the institutional level. I pointed out in 1998 that the downward wage adjustments commonly seen in the US were not symptoms of transatlantic brutality, as many Europeans seemed to think, but the necessary consequence of a monetary union.
Europe had no adjustment mechanisms then and has none now, except for ruinous unemployment. Fiscal room for manoeuvre is stymied by national debts and the stability and growth pact, which must urgently be reformed or replaced. What mechanisms exist for doing either of those things?
Euro-trainspotters will talk to you about the European parliament and three commissioners with unlikely titles. Forget it. This is about brute power, exercised by men with failing economies. Is the Franco-German engine bad for Britain? No, it is bad for Europe because these countries are backward in the economic respects that now matter.
Under these circumstances, scepticism is not enough. For Britain to join the euro at this juncture - even to think about it - would not merely be risky but stark staring mad. Not even friends of the euro should seek British entry now, since it would make an unstable position worse. Friends of the British national interest will shun it. The euro is in in too much of a mess to make entry feasible at any time in the foreseeable future.
Murdoch to oppose British euro entry
Times of India , JUNE 11, 2002
Australian-born media mogul Rupert Murdoch has vowed to use his position as Britain's most influential newspaper owner to fight any attempt by Prime Minister Tony Blair's Labour government to join the euro zone.
"My feeling about the euro is that there is a lot of nonsense spoken about it... It is a political decision (whether to enter). The central issue is one of sovereignty. If you give up control of your currency, you are going to give up control of your tax system just as night follows day."
If Tony Blair's government calls a referendum to
seek UK approval of euro entry, Mr Murdoch will have a message: "Vote
no...Europe is made up of so many diverse cultures and histories that to slam
it altogether with a government of French bureaucrats answerable to
nobody...The idea of Europe having one foreign policy, tying up its military in
one organisation, it seems to me 100 years premature. I cannot see anything but
benefit by waiting."
Full interview in the Finacial Times
Bank
of England chief explains UK euro delay
BBC 15 April, 2002
Britons
had yet to be convinced that the benefits of adopting the currency were
sufficient to warrant abandoning control over interest rates.
A conservative tide is sweeping Europe
ANATOLE KALETSKY
The Times, JANUARY 17
2002
The recently published eurosceptic novel 'Out of Europe' which is available free to download
The euro has bought Blair's silence on
Europe
Anatole Kaletsky, The Times, February 28, 2002
As Europe’s constitutional convention starts this morning in Brussels, as France and Germany move towards their most unpredictable elections in living memory, as rifts widen in the transatlantic alliance, as the EU prepares to embrace 100 million extra citizens from Eastern Europe in less than two years’ time, this is a decisive moment in the history of Europe and indeed of the world. It is a moment that Tony Blair ought to relish.
In fact, this pivotal point in European history might have been specially designed to showcase Mr Blair’s characteristic talents by the great spin-doctor in the sky. With his instinctive internationalism and proven capacity for bold new thinking, the Prime Minister would be in his natural element in dealing with the great historic issues that will face Europe and the world in the year ahead. Mr Blair would not just be satisfying his personal ambition, but fulfilling what he is said to feel is his historic destiny: restoring Britain to the central role which it once enjoyed in Europe and the world.
Indeed, on the most important questions that will dominate European politics from today onwards — the balance between national and federal institutions, the role of the EU in defence and foreign policy, the appropriate level of federal taxation — Britain is deprived of any voice at all. For as long as the euro decision hangs over Britain, Mr Blair feels that he has to impose a vow of silence about all constitutional issues on the entire Cabinet, himself included.
For example, the British Government denies that the constitutional convention will produce a “constitution” at all. The Government officially insists that the convention is merely providing a statement of principles for the guidance of national leaders.
By denying the convention’s true significance, Mr Blair justifies his personal lack of interest in the proceedings and avoids arousing controversies that might interfere with the short-term management of Britain’s euro debate. But he also reduces Britain to a detached bystander — even a deliberate saboteur — in a settlement that will govern Europe for decades. Already, British ministers and
Manufactured myths
Industry in Britain is better off
outside the euro
The Times editorial 2002-01-23
Britain’s manufacturing difficulties are genuine; but they are concentrated in the troubled telecommunications, metals and mineral and textiles and clothing industries. They have far less to do with the exchange rate than with the current global industrial recession; and they are dwarfed, despite the “competitive” euro, by those of Germany and France, let alone Japan, from which the minister has just returned and where industrial output last year fell by 14 per cent despite the yen’s steep decline against the dollar.
The steepest drop in the eurozone currencies’ value against the pound occurred back in 1996 and 1997. Business has adapted well. Since the beginning of 1999, Britain’s trade gap with the eurozone has narrowed by nearly two thirds, from £6.5 billion to around £2.5 billion last year. Imports of goods from the eurozone over the same period have risen at half the rate of exports. So to present sterling as the main, even if she admits it is not the only, culprit is nonsense. There is no reason to query the longstanding view of the markets that, in terms of British economic performance, sterling is quite appropriately valued.
Blair cannot now be honest about the euro
Anatole Kaletysky, The Times
2002-01-10
Blair told the British public in 1997 that he would recommend membership of the euro on one and only one condition: “If the economic case for doing so is clear and unambiguous.” He restated this many times in Parliament and confirmed it in last year’s election manifesto.
But last week, Gus O’Donnell, the head of the government economic service and director of the Treasury team whose job is to make this assessment admitted that the case for Britain joining the euro cannot be honestly presented in this way. “Economics can never be clear and unambiguous. Ultimately it will be a political decision.”
This comment by Mr O’Donnell may have seemed commonplace to regular readers of this column, or indeed to anyone with a reasonable understanding of politics or economics. But although it was merely a statement of the obvious, it could have a transforming effect on Tony Blair’s place in history, like the cry of the little boy in the tale of The Emperor’s New Clothes.
I have always believed that the hurdle to euro membership introduced by the 1997 statement was an extremely high one and that those three words — “clear and unambiguous” — would be the pivot on which the Government’s entire European policy might eventually turn. Mr Blair may not have realised this at the time. Maybe he hardly even thought about the precise wording when he allowed the Treasury to devise this extremely rigorous standard of proof.
Given the remarkably consistent two-to-one opposition to the euro in most opinion polls, the probability of Mr Blair winning a referendum seemed similar to the chances of Iain Duncan Smith becoming Prime Minister in 2005.
To see why Mr O’Donnell is right and a “clear and unambiguous” criterion can never honestly be satisfied by an economic assessment of the euro, you can do no better than to read the pamphlet produced last November by the No campaign — The economic case against the euro. This was endorsed by a galaxy of former Treasury and Bank of England economists.
Tories attack 'flawed' Euro
BBC 1
January, 2002, 18:48 GMT
The Conservatives have renewed their criticism of the euro, which has become legal tender in 12 of the 15 EU countries.
Underlining the Tories' opposition, party chairman David Davis said up to 70% of British people are still against giving up the pound.
Britain's role in Europe
In a speech to the European Research Institute (ERI), Prime Minister
Tony Blair has outlined his vision for Britain's future in the European Union.
Blair's impossible
campaign for euro entry
By Martin Wolf
Financial Times, Nov 25
2001, 19:59 GMT
PARLIAMENTARY
DEMOCRACY
Paper presented to the Sixth Congress from Frederick
Forsyth
Author of The Jackal (Schakalen)
Test for
tests
The evidence on the euro matters more than the speeches
The
Times, Leading article, November 06, 2001
New Conservative Party
leader Iain Duncan Smith
has moved swiftly to appoint key members of
his shadow cabinet.
http://news.bbc.co.uk/hi/english/uk_politics/newsid_1543000/1543453.stm
Duncan Smith beats Clarke to Tory leadership
By George Jones, Political Editor
IAIN DUNCAN SMITH pledged last night to make the Conservatives an effective opposition to Labour after being elected party leader by a convincing majority over Kenneth Clarke.
http://news.telegraph.co.uk/news/main.jhtml?xml=/news/2001/09/14/ntory14.xml
FT Editorial comment: Leading from the right
Published: September 13 2001 19:42 | Last Updated: September 13 2001 20:11
Iain Duncan Smith fought an effective campaign. But the credo that won him the Conservative party leadership will need to be transformed if it is to become a coherent strategy for the next election.
Despite his rightwing reputation, Mr Duncan Smith sought to portray himself as a "one nation" Conservative who could be pragmatic about issues such as homosexuality and soft drugs. He shrewdly identified one of the most unattractive traits of the Conservative right: that it has become identified "with what we dislike and hate rather than the things we like".
http://news.ft.com/ft/gx.cgi/ftc?pagename=View&c=Article&cid=FT3J050WKRC&live=true
New thinking is way beyond our
Ken
ANATOLE KALETSKY
The Times, THURSDAY AUGUST 30 2001
Conservatives: The leadership contest start page
The battle for the Tory party
July 21st
2001 From The Economist
Who becomes the next Tory leader depends on which is stronger—the party’s hatred of Europe or its survival instinct.
UK
Labour faces euro decision
BBC, Friday, 8 June, 2001 (good
links)
Love it or loathe it, the euro is set to dominate Labour's second term of office. Having safely secured a massive majority, the government has relatively little time to say whether it is converting "wait and see" stance on the single currency, to one of "campaign and convince".
Already, businessmen and activists on both sides of the euro divide have begun to mobilise for the expected debate ahead of any referendum.
Labour Will
Win, but Britain Has Already Lost
By Daniel Johnson, associate editor
of the Daily Telegraph.
Wall Steet Journal 2001-06-06
Many will vote
Labour with a bad conscience, knowing that Mr. Blair's record in government has
been mediocre even by the modest standards of its Tory predecessor, but meekly
submitting to the received wisdom that "he deserves another term" and the
(usually unexamined) assumption that Mr. Hague and his policies are too
right-wing or, more plausibly, half-baked.
The Economist magazine, having
issued strict instructions not to vote for Silvio Berlusconi (advice which the
Italian electorate unaccountably chose to ignore), last week informed its
British readers that they should vote conservative. This turned out to mean
voting against the Conservatives. The idea that Tony Blair is a better
Thatcherite than William Hague could only occur to executives of big companies
-- or their mouthpieces -- who are too rich and privileged to care about the
little guy.
The euro
bomb is already ticking
ANATOLE KALETSKY The Times, MAY 31 2001
Fed
up with elections? If you hate the political campaigning, then perhaps you
ought to emigrate. For the moment this campaign is over, the next one will
swing into action — and the great political campaign that starts next
Friday may run without interruption for four years, instead of four months. I
refer, of course, to the campaign about the euro, which will start the moment
the general election votes are counted.
Blair
and the euro
Jun 5th 2001 From The Economist Global Agenda
Tony
Blair’s Labour Party is headed for certain victory, and a probable second
landslide, on Thursday, June 7th. Will this encourage him to try to persuade a
sceptical British public to join the euro and to brave a referendum on the
subject? Or are the risks too great for the usually cautious Mr Blair?
Democratic Values and the Currency by Rt Hon Michael Portillo, IEA (Timbros storasyster)
The Euro-army will march to the beat of a
different drum
By Boris Johnson, Daily Telegraph, 2000-11-16
Boris Johnson is editor of The Spectator, http://www.spectator.co.uk/
Never underestimate new Labour's
determination to take us into the euro
PETER SHORE, The Times, NOVEMBER
16 2000
Lord Shore of Stepney (Labour) is the author of the recently
published Separate Ways (Duckworth).
Dear Aunty: an essay
on EMU
My aunt explained to me that EMU was a great idea, because she
wouldn't
have to change money when visiting France. I explained why EMU was
(and still is) such
a stupid plan. Having finished my explanation, my aunt
asked "why doesn't anyone tell us this?"
Speech by the Rt Hon Eddie George , 11 April 2000
David
Heathcoat-Amory, Member EU Convention (pdf)
David
Heathcoat-Amory
David was the Shadow Secretary of State for Trade and
Industry from 1999 until September 2001 when he stood down from the Shadow
Cabinet. Previously he had served as a Minister in the Treasury, the Foreign
Office, the Departments of the Environment and Energy, and had been the Deputy
Chief Whip in the last Conservative Government.
More
about him at BBC
Daniel J. HANNAN
European Parliament, Member
See also http://www.hannan.co.uk/
about Norman Lamont's book "Sovereign Britain"
The European Foundation (Bill Cash) Home Page
GLOBAL BRITAIN in the wider world
Founders: Lord
Stoddart of Swindon (Labour)
Lord Harris of High Cross (Independent) -
(RE: Founder of IEA)
Lord Pearson
of Rannoch (Conservative)
Institute of Economic Affaires (Timbros storasyster)
Centre for Policy Studies
"I do think we
have accomplished the revival of the philosophy and principles of a free
society, and the acceptance of it. And that is absolutely the thing I live for.
History will accord a very great place to Keith Joseph in that accomplishment.
A tremendous place. Because he was imbued by this passion also. We set up the
Centre for Policy Studies, and it has propagated these ideas, and they have
been accepted."
Margaret Thatcher
the United Kingdom Independence party
These Tides the magazine for all those working for the post-EU Europe
Freedom,
democracy and justice in the European Union and the Channel
Islands
No longer on the Net, unfortunately
The Superstate Rises. Our
Rulers Lie.
If it's not a state, why does it need an
army?
Libertarians....
euobserver.com (highly recommended)
Michael Portillo
Michael
Portillo at Conservative web-site
RT HON JOHN REDWOOD, MP for Wokingham
Struan Stevenson, MEP: A New Vision for Europe
web-ring run by
www.euro-sceptic.org
