Monday, September 13, 2010

A good analysis of the EU crisis.

Although written by one whose name conjures images of overpaid mandarins being wined and dined for legislative exemptions and favours as appeared to be the case from press reports of the Permanent Tax Secretary at HRMC, Dave Hartnett, this weekend; the linked article from the September edition of the Chartered Management Institute by Lord Eatwell, has a brilliantly concise explanation of the economic crisis in the EU, where mainly in its final paragraph does the author's biased past as an advisor to the windy & empty vessel Neil Kinnock, and present Labour peer shine through. A brief edited extract:

First, the economic health of our economy is inextricably tied to the economic health of the rest of the European Union. It is obviously in our interest that those to whom we sell over 60 per cent of our exports should be prosperous, providing a growing market for British goods. But perhaps of even greater importance is the financial stability of Europe. If the Eurozone were to collapse the resultant financial apocalypse would engulf us all.

Second, it has become evident over the past few weeks that the economic institutions of the European Union in general and of the Eurozone in particular require fundamental reform. Without major changes to the institutions of monetary and fiscal management the persistent weakness of the past decade will persist, (blog editor's note that is of course what persitent things tend to do ....persist) and we will all be buffeted by recurrent storms.

And my objection to the final paragraph which states the following:

It is becoming increasingly likely that the Eurozone will suffer a prolonged stagnation, not unlike the Japanese “lost decade” of the 1990s. That would be very bad news for Britain. A reassessment of economic policies and institutions is necessary throughout Europe. Britain should be taking a lead.

Well it is really just the final sentence, which in a sane world would read: Either "Britain should now leave this growing disasterof the EU centred around the eurozone." Or at the very least "Britain should be vigourously working to reduce its reliance on moribund EU markets by renewing its former trading links with the rest of the world". Britain cannot take a lead in the Eurozone, a fact of which an economics Professor with his impressive credentials and present President of Queen's College Cambridge, should be well aware. How, pray can a nation lead a group other supposed nations, of which it itself is not even actually a member?

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