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Countdown to €/£ parity | 102 comments (102 topical, editorial, 0 hidden)
Re: Countdown to €/£ parity (4.00 / 9)
There are too many Little Englanders who'd rather see the pound suffer hyperinflation - which is a reasonably likely outcome of the Brown plan - than see it disappear.

A year from now parity will be a distant curiosity.

Economically the pound should have been eliminated back in the late 90s. It was always a footnote on the NuLab ticklist, because pushing harder for it would have been political suicide.

So 'should' and 'will' are completely different questions. The answer to 'should' is Euro entry is the only thing that can save the UK from double digit inflation and interest rates of 15-20% a year or two from now. I'm sure the two year requirement could be waived at short notice, on the grounds that the UK won't get another chance to show practical interest in joining any time soon.

But 'will' is still beyond a last resort, politically. It would take food riots and martial law before it could be considered seriously in Whitehall - or at least a plausible threat of same.

I'd be impressed if Brown suggested joining ahead of time, but I'm not expecting that happen. The Tories would be even less likely to suggest it, for obvious reasons.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Thu Dec 11th, 2008 at 04:29:29 PM EST
Re: Countdown to €/£ parity (4.00 / 13)
My take on the internal UK politics would be similar, but the Diary is written more from an Irish/Eurozone perspective.  Would the Eurozone countries really want to take on the grief of Brits whingeing at ECB polices in the way that they whinge at Brussels now?  Hell, even if the Eurozone rescued the UK from an Iceland meltdown (geddit) they would get nothing but grief in return.  I suspect Merkel would let the UK stew in its own juice - and as you suggest - the Tories would be more inclined to that POW as well.  The real question is whether the City would have the clout to call the shots - especially if London was losing its position as a centre for global capitalism to Frankfurt/Paris.

My suspicion is that the UK will join the Euro far too late, if at all, and that the Germans will not be over eager to accommodate them - as they are not now over eager to adopt the Brown strategy for European recovery.  Bottom line - Germany will call the shots.

notes from no w here

by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Dec 11th, 2008 at 04:47:32 PM EST
[ Parent ]
Re: Countdown to €/£ parity (4.00 / 8)
You may well be right. And it's an interesting POV because the default UK assumption is that of course the EU would accept the UK on demand.

The possibility that there might be loss of face, or strings and conditions, not to mention a certain implicit payback, really isn't on the radar here.

The UK could point out that the City has been convenient for various semi-legal and illegal laundering and tax evasion schemes which have had tacit EU support, so it's not as if the EU is an innocent party. But that might be a little too overt and wouldn't be in the spirit of the game as it's played.

This is worrying because UK as Iceland 2.0 is far from unlikely. We do still have manufacturing and engineering industries of a sort, and Brown has been muttering about green this and that. We also have unexpectedly strong media and broadcast industries, and if it were up to me I'd be pushing the creative industries next to sustainable greenery as a replacement for finance - because we have the talent, but most of it is being wasted or sidelined.

Really we're in a 70s-style transition moment now - from Old Economy to New Economy.

Back then Thatcher and the Friedman Freaks were ideally placed to push through their idea of progress. Currently green tech and creative media are an obvious next step, but neither have the lobbying power nor the so-called intellectual and academic support that finance had at the time, so any transition is likely to be much less smooth and much more dangerous.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Thu Dec 11th, 2008 at 06:09:56 PM EST
[ Parent ]
Re: Countdown to €/£ parity (4.00 / 3)
Can't have Britain suffering the indignity of shacking up with the Cheese-Eating Surrendermonkeys under a single currency.  Read my lips: Naaah gaaah do it.

Be nice to America. Or we'll bring democracy to your country.
by Drew J Jones (pedobear@pennstatefootball.com) on Thu Dec 11th, 2008 at 06:11:59 PM EST
[ Parent ]
Re: Countdown to €/£ parity (4.00 / 5)
Even worse, the Brits can't have the Krauts running the show and telling them what to do!

notes from no w here
by Frank Schnittger (mail Frankschnittger at hot male dotty communists) on Thu Dec 11th, 2008 at 06:41:35 PM EST
[ Parent ]
Re: Countdown to €/£ parity (4.00 / 8)
That, too, but I just wanted an excuse to say "Cheese-Eating Surrendermonkeys" to get a laugh out of Jerome, since I know he gets a big kick out of that name. :)

Be nice to America. Or we'll bring democracy to your country.
by Drew J Jones (pedobear@pennstatefootball.com) on Thu Dec 11th, 2008 at 06:47:18 PM EST
[ Parent ]

Countdown to €/£ parity | 102 comments (102 topical, 0 editorial, 0 hidden)
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