Saturday, 10 December 2011

Britain Can't Afford EU Membership

Britain must have a totally free fiscal hand for the financing and refinancing of government debt and deficit by the Bank of England.

It cannot satisfy the rules which, even without the new pact that it has failed to join, discipline all EU members' fiscal policy (regardless of the use or no of the euro) through the Growth and Stability Pact.

Nor can the the main Coalition Government partner  antagonise the City institutions that have so generously funded them in their electoral campaign and current activities.

Of course they could always have continued to go through the motions of looking as if they are following the rules, with small qualifications, , exceptions and delays, and pretexts,  as they have been doing up to now, claiming exemptions - euro, internal market, Schengen - although sooner rather than later they would have had  to accept squarely that the country is excessively indebted and that the Party is in pawn to its funders.

This might once more have been acceptable or benignly neglected by  the EU but  it hasn't helped that London-based hedge funds mounted the assault upon Italian bonds.  Italy isn't a minor, peripheral member-state  of the EU;  Merkozy is complemented by Montraghi   in the  governance of Europe.

This time bluffs have been called and exceptions not allowed.


Antisthenes said...

I hardly think who mounts an assault matters it matters that the assault was triggered by the fact that the conditions were right enough for that assault to have a great likelihood of succeeding. And what matters to the euro-zone is not taking revenge on those who make that assault but to better address the conditions that made that assault possible.

dearieme said...

According to the FT, one of the exemptions Cameron sought was the right to impose sterner capitalisation requirements on UK banks than France and Germany propose to impose on their own.

He also wanted an agreement to protect the Single European Market.

hatfield girl said...

Absolutely, A, except insofar as who mounts the assault does matter. A casino City threatening, indeed seriously affecting, the real economy being championed by a member-state's prime minister at a time of crisis is unhelpful.

It is not a matter of taking revenge but preventing assault in the first place; you do not risk the real economy for hedge funds'profit. And the conditions that made the assault possible are an intransigent Italian problem that has haunted its state for the 150 years of its existence - major challenges to its authority from Church and gangsterism. Berlusconi has been dealt with but the corruption is a many-headed, deeply rooted monster - Italy's difficulties should not have been hyena'ed as they were.

hatfield girl said...

Both admirable policies, D. Did the Prime Minister suffer a negotiating and diplomatic failure rather than make impossible to accept demands?

He must have known that Sarkozy (a man described as 'one who thinks pretending to be virtuous makes him so' by an eminent French official) was out to monster him if he could.

dearieme said...

"Did the Prime Minister suffer ..." dunno, I am not privy to what happened. I note that Clegg was happy with the terms Cameron sought, thinking them so mild as to be uncontroversial.

I'm just wondering whether France is so gloriously bust that it's just indulging in blame-shifting.