Wednesday, 17 November 2010

Euro Sceptics rejoice over Ireland

Well it's clear that the economic crisis in Ireland is absolute categoric proof that the Euro will collapse, that it has made Ireland's problems much worse and that Britain is so much better out of it. Shame none of that is really true.

This isn't an article urging immediate membership of the Euro. It's clear that any referendum would be lost at least ten to one and that it is totally off the political agenda.

Ireland is up to its neck in it for more or less the same reason Iceland got in bother. It's banking sector was far too big for a small country to be able to bail out safely.  But considering how much larger Britain is as a country, if we had continued to spend like Labour and one other major bank, say Barclays, had gone pop last year we wouldn't have been far off where Ireland is now. At least Ireland can fall back on support from the EURO family. We certainly wouldn't be able to this, as we've spent years sneering at the EU.

There is very little chance of the Euro failing. Apart from the fact that the French and German governments wouldn't let it, there are still benefits from being in a currency union, ie the ability to have total certainly about the price of goods you are paying for and selling to countries in the same zone. Nissan in Washington has repeatedly said it would help its business if it had that.

Not being in the Euro means you can devalue your currency, replacing economic austerity with inflation. We have relied on this too often in the UK rather than trying to sort out our low productivity as a country. Leaving the Euro would be the worst of all the options available to Ireland and, despite how much it would excite UK commentators, is unlikely to happen.

When Iceland had its problems, it regretted not being in the EU and the Euro. In the UK, we are on our own. That emphasises more why we need to get on with radical action to sort out our national budget.


  1. who knows what you stand for - The lib dems like the euro will be obsolete in the next general election.

    The Euro has been a disaster so its understandable that the lib dems would back it.

  2. Another constructive comment Anonymous. The Euro has been a disaster. Why? I suspect the Euro will exist for a long time. I know you will be wrong about the Lib Dems.

    We are a hardy bunch and making the news setting policies for the first time in a long time. Talk to Lib Dem voters rather than your mates in the Labour party. Our voters are still out there. I joined when we were on 4% in the polls, so this is nothing!

  3. I am very grateful we joined the Euro. Otherwise the Punt would be in the toilet now and we'd have to impose crippling interest tax rises (in the middle of a recession!) to resuscitate it. The Euro saved Ireland's economy.

    A debate you may be interested in...(Daniel Hannan gets his ass kicked)