Today, Margaret Thatcher’s autobiography, first published in 1993, reads like a prophecy. It shows how deeply and with what extraordinary wisdom she had examined Delors’ proposals for the single currency. Her overriding objection was not ill-considered or xenophobic, as subsequent critics have repeatedly claimed.
They were economic. Right back in 1990, Mrs Thatcher foresaw with painful clarity the devastation it was bound to cause. Her autobiography records how she warned John Major, her euro-friendly chancellor of the exchequer, that the single currency could not accommodate both industrial powerhouses such as Germany and smaller countries such as Greece. Germany, forecast Thatcher, would be phobic about inflation, while the euro would prove fatal to the poorer countries because it would “devastate their inefficient economies”.
Thursday, November 18, 2010
Maggie's Prophecy
Thatcher's opposition to a single European currency explained.
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Fay, Delors et al did in fact anticipate the same crisis - in fact they welcomed the prospect.
ReplyDeleteThe idea was that a currency and sovereign debt crisis would force political integration.
Germany has the money, and the only way German voters are going to accept subsidizing the political project called "Europe" is to gain control over the budgets of foreign countries.
"Europe" may survive but it may become an increasingly German Europe.
Of course predictions are almost impossible, as history has demonstrated that it is a right irritable lot that populate the Continent, prone to outburst...
Delors et al did in fact anticipate the same crisis - in fact they welcomed the prospect.
ReplyDeleteYes, and this is alluded to in the article.
"Europe" may survive but it may become an increasingly German Europe.
How ironic in that German aggression was one of the driving factors in establishing the union in the first place.
The French are happy to come along for the ride.
ReplyDeleteThe FT reports that "Europe" (Frankenreich) wants Ireland to raise its corporate taxes. So it will be, you know, "harmonized" with the French and Germans. They're sick of Ireland getting the business - why lower your taxes when you can extort other nations to raise theirs?
A French official said the low corporate tax rate was seen by some elsewhere in Europe as “almost predatory”. “They need lots of money and we note they have a corporation tax rate that is very low,” the official said. “Supply must follow demand.”
Love that "supply must follow demand" - we want you to supply us money, so we demand you raise taxes" - this is how you learn the law of "supply and demand" if you are a dirigiste French official.
I recommend the Irish revolt.
They have to chose a path; none of them are pleasant. One of the paths leads to the loss of their sovereignty and the slow bleed of their wealth and vitality to the continent.
Why go that way?