Postcard from the future

As we hit the dog days of summer, ECB president Mario Draghi has announced more meetings to save the euro. But is this the future we want?

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Proud of the 12 stars of Europe?
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Simon Miller
On 3 August 2012 12:48

I wept yesterday as the 12 stars of Europe were raised in the velodrome and Beethoven blasted out of the tannoy as we celebrated the 68th medal for the continent at the XXXIII Olympiad.

Twelve years ago, on the day that the former nation state of Great Britain and Northern Ireland celebrated winning gold in the men’s sprint, one of the architects of the union Mario Draghi, president of the European Central Bank said that the euro was irreversible.

This was the moment that the world changed. Draghi refused to be bowed by the markets, those investors that thought that the euro was a doomed experiment, differing economic cultures and ever-growing debt problems pushing at each individual nation, leading some into doom-spirals of unemployment and austerity while former strong economies were dragged into the gutter that was the nature of an internal market.

But that didn’t matter. The architect had a glorious plan. There would be more meetings to sort out the rules, but the ECB was going to buy short-term debt.

Of course, it all depended on nation states asking for the money, and of course that troublesome country Germany would still have to agree; but no matter, if there was the will that would do it.

And no matter that the long-term debt which was crippling these countries would be ignored, the short-term servicing of debt was all important. You see, what the EU needed was time. Time it didn’t really have. But these meetings would show its mettle, give it the time it needed to put into place the full effect of monetary union.

Never mind that the technocrats had kicked democratic principles out of the water, le grand projet had to be realised no matter the cost. I mean why should citizens have a say over their economic future?

And then there was the matter of those troublesome Anglo-Saxons. The introduction of the financial transaction tax (FTT) in France was such a success that other eurozone countries adopted it.

Yes, investors left the Euromarkets taking jobs and taxes to the UK but the risky trading stopped, so it worked perfectly.

But there was still Team GB.

Now many advocated that we should be cut loose, set off to join a global marketplace, where money that was originally put into the EU, was targeted back into nation, debt paid off, investment in education and manufacturing and a low tax rate. To grow without the harmful, restrictive regulations that stifled growth. To have inward investment as we maintained trading links with our largest importer market. To control our own agriculture and fisheries.

And yet, there seemed to be a reluctance to leave. Politicians, businessmen, lawyers, they all advocated that GB should stay with the union. That the damage of exiting was more than the damage of remaining. That Europe was our biggest trading partner if you ignored little things like the Rotterdam effect and that in 2012, the UK had more trade with non-EU countries as it looked for better markets.

Even when qualified majority voting pushed the FTT onto the City and severe rules on derivatives came into force, the UK still remained in the union.

Sure there were some protests. But it was only the City. Those horrible, evil bankers got what they deserved everyone said.

Yes, some were surprised when most international traders left. And yes, when HSBC and Barclays re-registered in other countries, it was hurtful but at least we remained true to Europe.

OK when the UK economy collapsed and the Troika had to be called in as debt rose through the ceiling, there were riots. But with a legally-backed pro-Euro campaign in the papers and on the BBC, coupled with holding the referendum on the same day as the Britain’s Got Talent final, it was a proud day when we joined the euro.

Sure, the rationing can be a pain, so too the ID checks. And the constant civil war that is going on in Southern Europe is upsetting. Oh, and the bombing campaign by separatists is a hindrance, and I miss cod and other sea food but looking at that flag and listening to Ode to Joy, it makes me proud to live in UKL.

And it could have all been so different.

Simon Miller is the Editor of Financial Risks Today. He tweets at @simontm71

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