Gerald Warner: Last rites in death bed vigil for Sick Man of the Eurozone
ENDGAME is approaching in the slow death of the euro currency. It has been doing so for a long time, since the EU oligarchs have striven officiously, by every means at their disposal, to keep its life support system turned on.
Since that machine is powered by the involuntary donations of EU taxpayers, the euro has become a mechanism of impoverishment, destroying prosperity across the continent.
The Eurozone now fulfils the former role of the Ottoman Empire as the Sick Man of Europe. Like the ailing empire it is taking an unconscionable time in dying, which will make its ultimate demise much more lethal for Western economies. Until lately, most commentators on the euro debacle were focused on the minutiae of events as they unfolded. Now the crisis can best be viewed in macro terms – the European future is being delineated with a broad brush.
It no longer matters whether some compromise coalition government could save Greece from a further election; nor is a fresh election likely to secure a radically different result – like Irish voters at an EU referendum – for the objective realities have become implacable.
There is a growing acceptance that Greece will exit the euro this year. Markets and financial institutions are already factoring that development into their calculations. The more sceptical banks never erased the drachma from their IT systems; they are prepared to deal with a Greek sovereign currency. If the sensible thing had been done two years ago and preparations made for an orderly Greek default and departure from the Eurozone, the damage could have been limited more effectively. Instead, there is now a huge risk of contagion from a Greek default spreading to the Spanish economy, with incalculable consequences for the other dominoes.
It is fashionable to demonise the Greek public for rejecting austerity while wanting to remain in the euro. Of course that is a deluded expectation; but who fed the Greeks those delusions? Their own politicians, in collusion with Eurocrats who nodded through Greece’s admission to the single currency on what they must have known was a false prospectus. It is not in human nature to reject a Shangri-La that is offered not only by one’s own rulers but endorsed by the European elite. Add complicit bankers to that toxic coalition and it is easy to understand why Greeks declined to repudiate the bonanza of high salaries, jobs for life, easy credit fuelling house-buying, extravagant lifestyles and foreign holidays that was thrust upon them. The only place where that programme had no traction was Mount Athos. What needs to be assessed today is the wider implications of the euro crisis. Its roots lie in the fundamentally nonsensical concept of a single currency binding together 17 widely disparate economies and separate finance ministries, with autonomous fiscal policies. The architects of the single currency were well aware of that, but because of the political difficulties involved in implementing full fiscal union, in their impatience to push forward the project of integration they put the cart before the horse and pressed ahead with the more easily attainable monetary union ahead of fiscal convergence. Knowing the hubris of those deluded Euro-imperialists, it is not unlikely they regarded the threat of currency collapse as providing a future incentive to fiscal union – indeed that is the agenda some of them are now trying to promote. Events, however, have overtaken them.
There is no appetite for integration among Europeans; at popular level there never was. David Cameron’s fear of giving Britain a referendum on EU membership is a tacit admission that we are held in thraldom to Brussels against our national will. George Osborne’s latest gift of almost £10bn to the IMF – just below the limit that would have required a parliamentary vote, which speaks volumes – to be thrown into the bottomless pit of euro support was a downright provocation. So is the coalition government’s demand that Greece should follow the virtuous example of Britain in implementing austerity. Coming from a government that is “cutting” Britain’s debt from £1 trillion to £1.4 trillion, that is rich.
There is still a rapidly diminishing number of fanatical Europhiles intervening on internet websites every time the euro survives another day, to mock the “doom-mongers” and “nay-sayers” who forecast its downfall. As most people now realise, a car crash in slow motion will still inevitably end in impact. That long-deferred collision can not be postponed much longer: there simply is not sufficient money to prevent it. The Brussels elite stands exposed as a ship of fools that has led the continent to disaster. They are right about one thing: the collapse of the euro will herald the implosion of the European Union too. That is a consummation devoutly to be wished.
Search for a job
Search for a car
Search for a house
Weather for Edinburgh
Sunday 19 May 2013
Temperature: 10 C to 16 C
Wind Speed: 8 mph
Wind direction: North
Temperature: 9 C to 20 C
Wind Speed: 7 mph
Wind direction: West