Germany Puts Forward End Of British Pound -- UK Goes Crazy:

Are you for real? You have not even heard that Hollande is leading a massive push for Eurobonds and fiscal loosening which is being vehemently opposed by Merkel? Even if you take the view that this might be overstated, this whole proposition comes straight out of the blue to you?

I pointed out Franco-German differences before and you chose to ignore them. Now with France in the pooh and a new President the differences re coming at us like an express train. You still can't see that?

 

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Heroclitus, I asked friendly -- no need to go all drama queen on me.

I'm sorry, but I still not see an isolated Germany -- I just see minor differences between all parties involved. The answer lies in the compromise ~ which is a great thing.

Even I understand the German concerns for sure.

 

I'm not unfriendly. I'm just gobsmacked at your question (boulverse)

The French are leading a push for Eurobonds. This is not a minor difference. It is the underwriting of the debt by Germany. Germany is resisting hard and will apparently need to change the German Constitution to comply. There are two great forces now in Europe. The first is a campaign by nearly everyone to get the Greeks to vote for parties who will make and enforce a deal. The second is to get Germany to climb down from its intransigent position of austerity so that the deal that Greece eventually agrees to at least has a chance of working. You suggest that there will be compromise. This is an unknown. The compromise will involve a change in the German Constitution and that cannot be guaranteed. Holland is quite rightly leading a campaign for growth, much along the lines suggested by the British Labour Party. The division is not between les anglo-saxons and a Franco-German axis. It is between European conservatives and social democrats. Indeed, far from the anglo-saxon model being inappropriate, the anglo-saxon model primed by Gordon Brown and followed through by Barack Obama, is what will save the day for Europe. Of course this is just a sensible blend of deficit reduction and quantitative easing. But Hollande is on board now. The Greeks will need to be intimidated into submission so they stop voting for effectively no government and do what Christine Lagarde says and pay their taxes but it is ultimately a Christian Democrat (conservative) German Chancellor who is the obstacle now to the resolution of this crisis.

I wonder sometimes if you are an EU official, so "crisis, what crisis?" are your reactions to the current European turmoil. I can almost hear you saying "qu'ils mangent les brioches!"

"Drama queen". Your English is so perfect! Must be an EU official. Strasbourg or Brussels?

 

Sorry, had to snip your quote. My post was too long with it in.

I didn't represent you at all. Nor did I make any sneers, cheap or otherwise. I clearly and explicitly said I was surprised you hadn't included more of the usual myths pro-integrationists usually love. You can make what you will of that, I can't stop you. Some opponents of the EU are indeed brain dead morons, equally some supporters of it are too. Nor did I suggest that leaving the EU would lead to greater trade with anyone, nor will I. However, it certainly wouldn’t mean less trade. Can you provide evidence to the contrary? No politician or bureaucrat can.

Cameron is not and never has been a eurosceptic. Like most of his predecessors, his euroscepticism is for home consumption only and is never backed up by results. The UK has no influence because its share of the vote is simply too tiny to be influential. Influence only becomes significant when backed with the kind of money Germany is able to put up or interests are shared with significant numbers of other member states. Eurosceptics thoroughly understand the dangers of the current crisis and understand how interconnectedness in such a diverse union is a part of the problem. It's both incredible and blinkered to think that everyone who understands the situation thinks more integration is the answer. And who said we’d expect to be bailed out, let alone need to be?

No, I don't have a problem and I don't think you are capable of providing any help even if I needed it. Now you have made it clear that you are only talking about Southern European states no further explanation on the maturity question is needed, but in no way did I insist that you said I'm immature. I asked if you thought I was. OK? A simple yes or know would have sufficed. However I do vote for a party that integrationists see as "populist" . You "think" an independent UK would be more isolated? Why? And you might think the world needs a strong EU, but you trust the anti-democratic, corrupt and bureaucratic EU far more than I do.

Part of the reason the UK is overly dependent on financial services is that the European Commission is very choosy about which countries it will allow to subsidise domestic industries. It has refused to allow the UK govt to subsidise some industries (banking of course has been a notable exception) but free market rules demand that it allows access to subsidised goods from other member states. Ironic from a net contributing country, don’t you think? This had an enormous effect on the UK steel industry for example. And the EU can't be strong without a stable currency and it doesn't have the backing of very significant numbers of its citizens for the necessary fiscal pact to make that happen.

I didn’t say Germany should or should not pay for the euros survival; that's an issue for Germany. Nor do I think Germans are morons, but it is an undeniable fact that politicians told the people across Europe that the euro would bring prosperity and stability when they knew a crisis would happen. It seems to me they took the people for morons. The electorate in the UK was, without doubt, misled, and continues to be misled, by our own political establishment. How much respect do you have for the people of South of Southern European states in voting for populist parties? This voting for “populist” parties isn’t confined to Southern European states either.

Paying for the euro would be all well and good if it solved the crisis, but for how long do we keep pouring money into it before we admit that the eurozone’s fundamental problems can’t be solved until a single fiscal policy is accepted, and how do politicians persuade the people of the member states to accept such an animal?

No one with any sense wants to stop genuine fee paying students from studying here, but the bogus students using the student visa route to gain entry do need to be stopped. In a country where public services are seriously overstretched, that’s not xenophobic, it’s just common sense. And do you think the EU cares what you or anyone else who thinks it should reform thinks? Britain is being run for the benefit of the EU (which now decides the majority of our laws and charges us billions to do so), the bankers and multinationals, not for the majority of the people who live here. I'm not in favour of having the laws of this country decided for the benefit of the multinationals who ultimately get what they want. They'll learn to adjust. Just how do you think other independent countries cope, let alone prosper as many undoubtedly do?

 

Expensive sneers are alright by me! The impact of leaving the EU is pretty clear. Either the UK would have to comply with EU regulations, over which it would have no say, or it would have tariff barriers raised against it. It would also damage inward investment as Asian and American capital would not go as easily to the UK as it does now. The UK would also have to negotiate its own trade agreeements with China, and would lose the leverage that the EU has. The EU would almost certainly impose restrictions on UK Financial services and the City (they are trying to do that with the UK in the EU so they would defintely do it if we had no veto to stop them) which would favour Frankfurt and Paris over London. The argument against all this has been that britain would boost its trade with the rest of the world. This is cloud cuckoo land.

Cameron is an opportunist. People who understand the situation - including Eurosceptics - have highlighted that you cannot have a single currency without a political union. You need to have a union as in the USA to avoid the situation we have in the EU now. This is actually where the Eurosceptics and the Integrationists agree. They both argue that the soggy compromise is the problem - the current situation pretends that you can have a single currency without a political union but of course a single currency either needs budgetry control to be imposed on all member states (something politically difficult) or that Germany stands behind the currency.

Here is the agreement between the two fundamentalist sides:

Eurosceptics argue that a single currency necessitates political union and so are against it (for simple trading purposes a single currency is extremely useful).

Integrationists agree that a single currency necessitates political union and so are for it.

It's the compromisers in the middle who have led us to the current debacle.

I don't really trust them. I think the EU should be reformed. The current bureaucracy won't reform because theya re getting fat on the gravy train and the Eurosceptics don't really wnt them to reform because they know that would make European institutions stronger. Again, the two extremes collude for different reasons.

Free trade is against subsidies. Which subsidized goods from other member states? I am sure this is an exception. How do you argue that British Steel was victimized. If you can make the case then my argument is that this is not how the EU is supposed to be. I am old enough to know though that British manufacturing was destroyed by Thatcher in the early 1980's and New Labour did nothing to revive it. Germany, on the other hand, is economically strong because it invested and renewed its technology and industry. Britain preferred to go with Financial Services which makes the UK very vulnerable to isolation.

This is a conspiracy theory. The truth is that everything always looks clear in hindsight. Germans need to understand that they have benefitted from expanding EU markets and the buying power of Greeks with the Euro. If they want to keep this up they can't let their partners sink. The issue for the Euro, as I have said above, is that it requires a certain level of integration. The problem for isolationists is that free trade requires this more and more. Why should Germans allow British imports based on cheap British Labour costs if those labour costs come from Britain using cheap labour that has been deprived of the sort of labour rights Germans have? You see this line of argument leads to either protectionism - which destroys trade - or integration, by agreeing on a common set of labour rights that levels the playing field for all. You can't have real free trade without more and more integration. It's a logical thing. The less you have integration, the less leevl the playing field, the more the jstification for protectionism and the more the likelihood of limited growth as result.

Good point. This is the problem with politicians who build a system without seeking the consent of the people.

No, it's not common sense its grossly overstating a problem so that it creates a seige mentality. It's dishonest. And it just drives thousands of Asians to the US or Australia to university. I have worked with Mainland Chinese, in China, who were educated in Britain. The impact this has on British "soft power" is incredible. These types of students are now being deterred from studying in the UK by xenophobia. There are always overstayers. Populist parties twist and distort this to create fear amongst the general population. The impact is to weaken a weakening Britain's weakening influence in the world still further.

Capital now is global. Actually it always was but now the world is connected by trillions of foreign currency transactions every day. You can't wish it away. Prosperity is determined by capital flows, trade flows and commodity flows across borders. Multinationals will adapt. They will ignore the UK. They actually largely already do, apart from the City. Britain is more and more irrelevant because it is not in the Eurozone.

I don't understand what you mean by coercion. The UK agrees by Treaty to agfree by EU Regulations over which it has a veto.

It needs to elect its executive as well as its legislature.

This doesn't make sense. Why does the EU care about a non member's trade deficit?

Don't understand although I'm glad you don't like the Daily Mail.

 

How's this working out now Jan?

 

At first I thought he ( a hypothetical person ) suffered from Copy and Pastitis and just liked creating Topics , regardless of what they said .
Then I began to advise same hypothetical person regularly here , that his Talents might be many , but that Economics and Finance did not figure in them .
Now , remember my small contribution to Economic Theory :- take any and all of his Copy and Pastitis selections and totally reverse the article conclusions .
You will then have very close to a 100% reality success rate .

 

plums.... we've seen what a mess the 'euro' created..... bring back the franc, pesetas etc for the deinflation and diversity again. 'eurozone' phah, 'europe' thankyou verymuch.