Friday, July 22, 2011

Is it time to say 'au revoir' to the Euro?

During the election campaign last year, a lady angrily approached and accused me of wanting to ditch the pound. I calmly explained that, while it is Liberal Democrat policy to join the Euro, this would only be when the economic circumstances were correct and after approval in a referendum. The lady considered my words and then decided the best option was to hit me with her umbrella.

Being a major trading nation, we in the UK cannot ignore events elsewhere in the world – but I sometimes feel our xenophobia prevents us from rational discussion. Depending on which paper you read, the EU is a German plot to succeed where the war failed, a French scheme to cover up for their inefficient farmers, a Spanish intention to grab the UK fishing grounds, or a combined European ideal to keep those British in their place. No-one actually wants to discuss how to make the EU work, let alone refer to the benefits of our membership. That lady obviously felt that even the thought of joining the Euro made you some kind of traitor.

While all our attention has followed the hacking scandals, the Euro is heading for yet another crisis. At the time of typing, Greece are set to receive a huge rescue package, Ireland and Portugal have had their problems, Italy and Spain are on the brink of joining the queue, and Bulgaria have decided to delay their entry.

Many in the UK , especially the media, look on, with barely concealed joy, at the troubles our EU partners are facing, smug at the fact we stayed out of the scheme, and, in a few cases, even praying and willing for one or two states to go bankrupt to confirm our feelings of superiority.

As I said, this kind of attitude makes discussion difficult. It is certainly not in our interests to see Europe go under – the knock on effects could result in destroying our already frail economy leading to business collapses and massive unemployment – not to mention having unsavoury elements on the rise throughout Europe. Having the southern states becoming virtual colonies while the northern states fund them will cause resentment amongst all peoples.

Despite its many faults, I have always favoured membership of the European Union. It is however a huge bureaucratic mess and we should be more involved with a positive approach, using our weight to reform and streamline and turn the EU into the powerful internal trading bloc we know it can be.
However I have been a bit unsure about the Euro as I was never sure how you can have one common currency and one common bank across national borders. When troubles strike in the past, a government has the option of devaluing its currency to make its exports more attractive. But how can you devalue your currency if it is not yours to do so?

I cannot claim to be an economic expert, so am not qualified to offer a detailed solution, but it seems to me that the problems hitting various European countries are because their currency was locked in to a certain rate and not able to float to find its natural level. Therefore would one solution be to temporarily break-off membership of the Euro for various states, introduce a ‘Greece Euro’, ‘Portuguese Euro’ etc, and then in the future, once things have calmed down a bit, put it all back together again?

I don’t think a two-speed Europe is the answer – (i.e. those in the zone speed up their integration) – as this would virtually permanently lock out those who are not currently a member. We have to think long term. If and when it will be to our advantage to join the Euro, as with other states currently outside the zone, then it must be made feasible to do so.

Whatever the solution it is clear that Europe, ALL of Europe, is in crisis. If we are to move towards a cross-European currency, there should be in place measures to allow such temporary suspensions to address specific problems – and this is an area where the UK could come forward with ideas and reforms.

If it is time to say au revoir to the Euro, however temporarily, let us put that case forward and get back on track to the Europe we want to see.

Monday, July 18, 2011

Prime Minister's Questions - 50 years old - and the scores are ... ?

This week is the 50th anniversary of Prime Minister’s Questions. Over the years PMQs has seen many controversial moments and gladiatorial contests – but many argue that it shows the best and the worst of British politics.

I have decided to score the various contests. They are from my own impressions since the Commons was heard (from 1978) and seen (since 1989) and, earlier than that, I have had to judge from other accounts. The below scores are my views alone and are just for fun – and I am only counting the leaders themselves rather than stand-ins.

Harold MacMillan 1-0 Hugh Gaitskell
A far gentler duel than what we are used to now, but old Mac was confident he could hold off Gaitskell's attacks – (hence the introduction of PMQs in the first place).

Harold MacMillan 0-1 Harold Wilson
Gaitskell’s sudden death gave rise to the great debater, Wilson. Just eight months opposite each other was enough to see the confident Harold gain an edge over a government weakened after Profumo and the Long Knives.

Alec Douglas-Home 1-2 Harold Wilson
Harold again confident over a typical old-school Tory. However he did not have everything his own way, Home was able to lead a late spirited Tory fight back.

Ted Heath 3-6 Harold Wilson
A contest lasting ten years – hence the high score as many points were scored. There was great disappointment in Tory ranks at Heath’s early appearances when Wilson easily outmatched him but Ted made some advances at the time of Labour’s troubles in the late 60s. However Heath was never confident at either side during PMQs.

Margaret Thatcher 0-1 Harold Wilson
Like Heath, Mrs Thatcher struggled at first to deal with the slippery Wilson – but they only faced each other for a year.

Margaret Thatcher 2-2 Jim Callaghan
From 1978, the Commons could be heard, and a now confident Mrs T was up against the old warrior James Callaghan. A well-matched contest as both in turn faced economic difficulties as PM.

Margaret Thatcher 3-2 Michael Foot
Michael Foot was a master of the Commons, a ferocious debater, but became leader too late in life. Although he often scored during the difficult times of the early 80s, he was let down by his own party troubles. A post-Falklands Mrs T rapidly grew in confidence.

Margaret Thatcher 6-0 Neil Kinnock
Over seven years, this was a complete mismatch. Mrs Thatcher was full of confidence and dominated the Commons in the mid-to-late 1980s, and Neil Kinnock just could not compete. Even open goals such as Westlands were missed.

John Major 0-0 Neil Kinnock
A bore draw. John Major had little of Mrs T’s dominance and both sides were just marking time until the election.

John Major 1-2 John Smith
Major now with his own mandate and more confident but bested by the former QC who sadly died too early.

John Major 0-3 Tony Blair
The start of the unstoppable force. John Major was often weakened by revolts from his own side while Blair and the confident ‘New Labour’ party began to dominate.

William Hague 3-3 Tony Blair
Blair was now a confident PM with a huge majority but Hague was able to match him all the way – this was an excellent contest.

Ian Duncan-Smith 0-3 Tony Blair
Oh dear oh dear. The quiet man unable to cope as Blair regularly won the day.

Michael Howard 1-1 Tony Blair
After the invasion of Iraq, Blair looked as if he could be on the ropes but Howard’s support for the invasion weakened his position. The two leaders looked too alike in a quiet contest.

David Cameron 2-2 Tony Blair
The fifth opponent for Tony Blair became his most formidable. Best known for his opening line ‘you were the future once’, Cameron looked confident – but Blair still able to defend himself.

David Cameron 4-1 Gordon Brown
Gordon Brown, at last the PM, started well, and had his ‘Brown bounce’ as Cameron suffered a lack of confidence. However as the troubles began, Brown struggled and Cameron triumphed regularly.

David Cameron 1-0 Ed Miliband
This match has only just started but Cameron has won the opening exchanges. However at the time of typing, Ed has the ball in his opponent’s penalty area. Will he be able to hit the back of the net?

Concluding, the most effective at PMQs that I have seen is Tony Blair, who saw off a succession of opposition leaders and always maintained his confidence. Margaret Thatcher, like Blair, was able to dominate the Commons but she was fortunate that, for much of her premiership, she was facing Neil Kinnock. As for Harold Wilson, this relies on the accounts of others, but most testify that he was formidable at one-to-one debating in the bear pit of British parliament.

But, as I said, this is just my opinion. What do you think?