Default position

Bill Jamieson (Perspective, 29 September) is probably right that, had the UK joined the euro, we would have been caught up in the turmoil surrounding Greek and other nations’ sovereign debts. But he is wrong to suggest the existence of the single currency is the root cause. Indeed, had we joined, our more central role may have influenced political decisions for the better.

There is no reason why sharing a currency implies that one country should underwrite the debts of another, and I would suggest the action of French and German governments in this respect owes more to the parlous position of their countries’ banks should a Greece default lead to similar action on the part of Italy.

A single currency certainly imposes discipline – principally the inability to devalue or print money as a way out of the problem. However, such solutions are inevitably short term and structural economic problems ultimately need to be addressed.

The natural order in the current situation is to default, leading in the longer term to more responsible actions by both governments and those who lend to them.

By continuing to underwrite the debts of profligate nations, more responsible action will only come through greater regulation, and that is political, not monetary, union.

Ian Baxter

Broomieknowe Gardens

Bonnyrigg, Midlothian