Why should you believe anything the Euro group says about Greece?

They told us if the Greek people voted against the final proposals of the Euro area they would have to leave the Euro.

The Greeks voted No, so they were invited to new talks to stay in.

We read they would have one last go at sorting it out at a special meeting yesterday.

That failed.

So now the Greeks have been invited to table more proposals by Friday, with a meeting for the heads of government of the whole EU scheduled for Sunday to endorse a deal or agree to no deal and its unspecified consequences for Greece’s Euro and EU membership.

Meanwhile the unpleasant threats to Greece continue, with no proper support for Greek  banks and with  talk of bankruptcy and Euro exit.

This is not a sensible, friendly or effective way to run a single currency. Those who want the Euro need to support all parts of the zone and have confidence in its member states and banks. To its critics the Euro is now doing obvious economic damage to Greece and more widely, and is causing major tensions between European countries.

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93 Comments

  1. Margaret Brandreth-J
    Posted July 8, 2015 at 6:19 am | Permalink

    If I were Greek , I would be preparing an alternative back to drachma plan making it look strong enough to put the shoe on the other foot.

    • Hope
      Posted July 8, 2015 at 7:55 am | Permalink

      JR, what is Cameron’s input this week. Will he denounce the threat by Shultz that the elected Greek Govt should be ousted for an EU imposter? He was vocal with Russia and demanded sanctions. We heard the scare tactics from Osborne and his reported comment of the Greek suicide note, are these two also on the side of trying to scare Greece and the British public?

      We also heard how Junker’s life work to bring about destitution, mass exodus of Greek people, homlessness, mass unemployment (56 percent youth unemployed) loss of business and destitution was more important than the millions suffering as a consequence of his political dream which he receives ove £300,000 of our taxes to promote!

      The British public deserve to know what Cameron’s position is and why he is not condemning the words of Junker, Shultz and Osborne. In light of these events does it change his alleged renegotiation? Could he now tell us what he is renegotiating?

      The IMF is owed about Euro 21 billion, what will Cameron be pushing for? Is he supporting the the LeGarde threats not to extend credit to a distressed nation which is its remit? They could break the rules to help Greece, they broke the rules to help the EU project.

      I hope Greece remains firm. It will act as an example of how a nation should stand up to threats from EU dictators.

  2. Ex-expat Colin
    Posted July 8, 2015 at 6:22 am | Permalink

    Unfortunately Merkel and Hollande primarily will have to tell their parliaments that the money is lost. It won’t be paid back. It would be funny if it were not so insane.

    And I don’t know quite why Tspiras has to go to the EU MEPs on the demand of outraged Guy Verhofstadt.

    • Denis Cooper
      Posted July 8, 2015 at 9:20 am | Permalink

      Because the European Parliament is the “home of democracy” in Europe, at least according to Juncker when he addressed it yesterday, and so of course the mere Prime Minister of a member state should be prepared to drop everything and appear before the parliamentarians and submit to their scrutiny. He may be obnoxious, but remember that Guy Verhofstadt is a duly, and directly, elected representative of the European people. And if you wonder how we have got into this position where the EU Parliament can assume this superiority, the answer is that the UK Parliament has agreed to it happening by approving treaties agreed by successive UK governments, going right back to the Treaty of Rome.

      • Peter van Leeuwen
        Posted July 9, 2015 at 5:26 am | Permalink

        @Denis Cooper: Not only Guy Verhofstadt, but also Marine le Pen and Nigel Farage have been directly elected, so it may take a little courage to accept an invitation to face the European Parliament. Recently I’ve seen Hungary’s Mr Orban do it and I could well imagige that Mr. Cameron or Mrs. Merkel may at some stage chose to accept such an invitation.

  3. Jerry
    Posted July 8, 2015 at 6:32 am | Permalink

    “Meanwhile the unpleasant threats to Greece continue, with no proper support for Greek banks and with talk of bankruptcy and Euro exit.”

    Eurosceptics have been putting that scenario forward as the solution for years, now apparently it is the wrong scenario, I wonder why – could the reality have sunk home, that this will be very messy, hence why all the EU leaders have been summoned to a Heads of State meeting on Sunday?…

    Reply I still advocate Grexit as the best answer. If you want the Euro then you have to pay for it and support all its members.

    • Leslie Singleton
      Posted July 8, 2015 at 8:47 am | Permalink

      Dear John–You seem to be saying that support must be given come what may. How could that work when one member is aggressively spouting drivel? And your thoughts on the lack of finality are wide of the mark too because as things stand there can never be finality. Thus even if the biggest catastrophe in the history of the Cosmos blah blah happens and Greece were to leave the Euro, the Euronutters would immediately start trying to get Greece back in. There is no stage, before during or after, when, especially if there is a new government, Greece with a few honeyed words could not get back in.

      Reply I recommend Grexit!
      If they wish to have a single currency then they have to pay for it.The Central Bank does have to finance Greek banks, and the rest of the Euro area does have to help finance poorer countries in the zone, just as happens in the dollar or sterling zones where the rich parts send plenty of money to the poor parts.

      • Denis Cooper
        Posted July 8, 2015 at 10:43 am | Permalink

        But it would be a catastrophe, Blair has said so!

    • Denis Cooper
      Posted July 8, 2015 at 9:57 am | Permalink

      All 28 EU member states have to be involved at some point because you cannot have just the 19 which are already in the euro taking decisions which will affect all of the others in various ways. The question for us is whether Cameron will make proper use of the opportunity to protect our vital long term interests, or he will continue down the same insane foreign policy line of not only permitting but actively encouraging the formation of a federal United States of Euroland which will eventually engulf us as well. I can’t say that I’m optimistic about that.

      • Jerry
        Posted July 8, 2015 at 8:08 pm | Permalink

        @Denis Cooper; Yes indeed, the possible collapse of the political EU might well affect all 28! If the EU moves towards an expatiated USE, for at least the EZ 19 (or should that be EZ18?…) then surely that will boost the likelihood of our own “No!” vote in the up-coming referendum?

      • Peter van Leeuwen
        Posted July 9, 2015 at 5:50 am | Permalink

        @Denis Cooper: A ‘federal United States of Euroland’ is not envisaged Denis. You can see that also the EZ shows a hybrid nature, in which the intergovernmental component is actually much stronger, because there is no separate EZ parliament. The Greek prime minister must have faced not EZ MEPs yesterday (I haven’t seen any of it). A bit similar as you not yet having a separate English parliament.
        I remember Mrs. Merkel once stating to the EP that her and other coutries cannot move faster than their national democracies will allow. In my view the eventual EZ integration will never go much deeper than the minimum required for fiscal consolidation and operating a single currency.

        • Jerry
          Posted July 9, 2015 at 6:55 am | Permalink

          @PvL; “In my view the eventual EZ integration will never go much deeper than the minimum required for fiscal consolidation and operating a single currency.”

          That would be a full and federal USE then…. Nothing less will allow for for the proper and permanent “fiscal consolidation and operating a single currency”.

        • Denis Cooper
          Posted July 9, 2015 at 6:57 am | Permalink

          Elmar Brok is certainly envisaging it, see comment below.

    • Jerry
      Posted July 8, 2015 at 3:44 pm | Permalink

      @JR reply; No we do not (should not…) need to pay for a non-Grexit, the EZ does, on the other hand as members of the EU and/or IMF we might just have to pay for a Grexit if it gets messy, even more so if it drags the Euro down with it [1]. I have no wish for the UK to join the Euro unless the EU becomes a proper and fully federal state and we, by way of a direct referendum, decide to be a part of it, which a “Yes” vote in the up-coming referendum will not give. The EZ as currently structured is unsustainable who ever is within or outside of it.

      I will just add, I want a strong case for a Brexit as things are, that is why I keep pushing the need for a strong economic case and plan, not woolly semantics on who rules who and how when such semantics mean a million different things to a million different people. The Brexit ‘group’ needs to build on the excellent plan for the UK put before the nation by Mr Osborne today…

      [1] like it or not a lot of UK (owned) companies are exposed to the market value of the Euro, then of course we have all those EZ companies that have factories etc. employing substantial numbers of workers here in the UK

      • libertarian
        Posted July 8, 2015 at 5:10 pm | Permalink

        Jerry

        Less than 1% of companies in UK are foreign owned so I’m not sure and can’t find exactly how many EZ firms and how many people they employ there are. Please give us the figures. Oh and no woolly semantics please, hard numbers.

        Like it or not UK companies are exposed to the market value of a whole range of currencies thats why we have a thriving city based FX market.

        • Jerry
          Posted July 8, 2015 at 8:20 pm | Permalink

          @libertarian; Glad you think that EZ owned companies with factories, plants and other commercial interests both in their own country and the UK will opt to ride the storm out here in the UK rather than first and foremost protect jobs etc in their own member country. Oh yes “the Markets” as if they never crash. A lot of small companies have exposure to the Euro, do not under estimate the problem so glibly.

  4. Richard1
    Posted July 8, 2015 at 6:39 am | Permalink

    It would be better if there was a clear voice of rationality in Greece – arguing for economic independence from the eurozone and economic reforms. But there does not seem to be. The syriza line, which appears to have support, is they don’t need to do any any reforms – those are all just classed as ‘ Neo-liberalism’ and ‘austerity’. All they need do is wait for another huge bung from other EZ taxpayers, as the EU is so scared of the political threat to it if a state exits the EZ. They might be right, and if they are the same tactic will surely be tried elsewhere.

  5. Timaction
    Posted July 8, 2015 at 6:40 am | Permalink

    Excuse me Mr Redwood, but you’re surprised? When will you realise that your leader is part of the problem, not the solution? I don’t see how a party that supports the EU with a few who claim scepticism can even discuss this. When you remove your leader then we’ll start to believe your party has a future.
    When are we going to hear and debate his proposals to renegotiate? Deathly silence.

    Reply My party has just won a General election and has offered a referendum – the referendum is the future! Why not occasionally give us some credit.

    • Hope
      Posted July 8, 2015 at 8:01 am | Permalink

      The party does not deserve it. It insults its supporters and others then asks for their vote! It is in office through scare tactics of the SNP ruling. Still no EVEL despite the Downing Street promise. Moreover it is no longer a party with conservative values, it is New Labour.

      Sadly you are a dying minority in your own party.

      Reply English votes before the Commons on Wednesday next

      • Hope
        Posted July 8, 2015 at 2:10 pm | Permalink

        Not the EVEL promised by Cameron a dilute SOP named EVEN or a watered down veto, a bit like the right to recall nonsense. We want the same as the Scots. Cameron w right in the commons today, it is a modest proposal.

        Osborne is still on manouvres and promoting the dissolution of England by his and Hestine’s EU regionalisation of our country.

    • Ken Moore
      Posted July 8, 2015 at 10:27 am | Permalink

      It’s a bit like Joe Fraser going into the ring with Mr Bean with his hands tied behind his back..then being expected to be given credit for his victory.
      Conservatives won DESPITE Mr Camerons best efforts to retain his Lib Dem shield. Disgraceful self serving man. Throw in a bit of scaremongering over the SNP and the Conservatives scraped in.
      If the Conservatives faced down Cameron a bit more often they would gain more respect.
      The trouble is the leadership will just see the election as a ringing endorsement of their Tony Blair plastic politics.

      We shall wait and see if the referendum is free and fair.

    • Jerry
      Posted July 8, 2015 at 3:48 pm | Permalink

      @JR reply; “Why not occasionally give us some credit.”

      You’ll never get that from a UKIPper, to do so will be an admission that UKIP is an irrelevance…

      • Timaction
        Posted July 9, 2015 at 9:37 am | Permalink

        ……………ever wonder why we’re having that referendum Jerry?

        • Jerry
          Posted July 9, 2015 at 6:07 pm | Permalink

          @Timaction; “ever wonder why we’re having that referendum”

          Because the Tories won a majority in May 2015, something the UKIP leader boasted about preventing in May 2010…

  6. JoeSoap
    Posted July 8, 2015 at 6:43 am | Permalink

    Nobody believes politicians any more!

    This is just proof if anybody needs it. Indeed a Greek No vote was a vote to leave the Euro, now it’s not.

    I wonder in our own referendum whether a No vote will be to leave the EU, then suddenly, when it happens, it won’t be!

    • Denis Cooper
      Posted July 8, 2015 at 9:59 am | Permalink

      The government Bill is silent about what would ensue from a No vote.

  7. eeyore
    Posted July 8, 2015 at 7:04 am | Permalink

    Mr Redwood offers the usual politician’s solution to a problem: smother it in someone else’s money. His assumption that the Greeks are acting in good faith is unproven. Greece is a serial defaulter, a poor nation full of rich people whose national hero is Odysseus. Business is in their bones, they mistrust banks, keep their money under the mattress and depend on family and friend networks rather than the state. Altogether, Greeks are a formidable adversary for a nation whose national hero is Siegfried.

    I’m with the German people on this one, and hope Mrs Merkel is too. That she should spend political capital by going the extra mile to find answers seems to me more creditable than blameworthy.

    No one doubts that the euro is a deeply flawed, even dangerous concept. There is no provision within it for the sort of support Mr Redwood advocates, any more than for the sort of insolvency that Greece so clearly needs. Why the former solution should now be invented and applied, rather than the second, is not at all easy to see.

    I advocate waiting and seeing. Europe might yet be agreeably surprised at the amount those Greek mattresses can disgorge when firmly prodded.

    Reply I am not advocating anything of the sort. My view is the best answer is Grexit! The Euro area does have the power and the money to lend or give to Greece if they wish to make a go of it, under voluntary Euro regional policy transfers and under the ESM

    • Denis Cooper
      Posted July 8, 2015 at 10:29 am | Permalink

      The ESM can only lend, not give, and under “strict conditionality”:

      “(2) On 25 March 2011, the European Council adopted Decision 2011/199/EU amending Article 136 of the Treaty on the Functioning of the European Union with regard to a stability mechanism for Member States whose currency is the euro1 adding the following paragraph to Article 136: “The Member States whose currency is the euro may establish a stability mechanism to be activated if indispensable to safeguard the stability of the euro area as a whole. The granting of any required financial assistance under the mechanism will be made subject to strict conditionality”.

      That’s the EU treaty change which Merkel demanded in the autumn of 2010, and which Cameron with the prior consent of both Houses of Parliament agreed to simply give her free gratis and for nothing, asking for no other EU treaty changes in return, so passing up that fabled “golden opportunity” to extract concessions in exchange for agreeing to EU treaty changes to stabilise the euro.

      Amusingly enough, while Merkel demanded that EU treaty change in the autumn of 2010 because she feared that without it the German constitutional court might rule that the ESM was illegal under the EU treaties, and that was the basis on which the UK government proceeded to get parliamentary approval so that it could finally ratify the treaty change, eventually the EU’s Court of Justice ruled that it had not been necessary, on a correct reading of the existing treaties the eurozone states already had the legal right to set up the ESM. In other words, the UK government and Parliament, and the governments and parliaments of twenty six other countries, had been wasting their time passing it.

      And just as we had Merkel repeatedly emphasising that the EU treaties did not permit any bailouts right up to May 2010 when she decided that there would have to be a bailout of Greece, so we now have Schaeuble ruling out any debt relief for Greece on legal grounds:

      https://euobserver.com/tickers/129509

      “Schaeuble: Debt cut prohibited by EU treaty”

      “German finance minister Wolfgang Schaeuble Tuesday said he was waiting for the next proposals from Greece “with interest”. Asked about debt relief for the country, he said: “Whoever knows the EU treaties knows that this is prohibited.””

      Well, we will see what happens; and if it is decided to break the EU treaties by relieving the Greek government of some of its debt then we will wait for the eurofederalist lawyers on the EU Court to say that actually this did not break the EU treaties, as correctly read by themselves.

  8. Duyfken
    Posted July 8, 2015 at 7:11 am | Permalink

    I hope this debacle is providing a few lessons for Cameron, and that he takes heed. He can play the hardest of hard ball in the confidence of knowing the EU will not countenance loss of the UK’s membership. On the other hand if, as I expect, he is as soft as butter and gets the square root of nothing from his negotiations, then our referendum should see a NO win.

    But NO apparently is not what the EU will accept, as we see in the Greek case. We need a “cast-iron” commitment from the government in advance of the referendum that it will faithfully and immediately honour the result whichever way it goes. A referendum is useless without that.

    • Hope
      Posted July 8, 2015 at 8:06 am | Permalink

      The EU will m are an example of Greece as a threat to other countries to prevent them from daring to do the same. They will try to act to their economic disadvantage. If Greece were to survive outside the EU like Iceland it would devastate the EU project. No mention by the MSM of Iceland as an example of what can be achieved without the EU. They too told the EU to do one, as it is commonly known.

      Meanwhile Osborne preparing the ground for the dissolution of England in line with the EU regionalisation plan ably assisted by Heseltine.

  9. agricola
    Posted July 8, 2015 at 7:12 am | Permalink

    A Greek departure from the Euro project and or EU would be seen as a rejection of the United States of Europe project of which the Euro is seen as the controlling cement. It could very easily have a domino effect in Southern Europe where the people, if not their governments, have an increasingly jaundiced view of a USE. They can see the democratic deficit.

    William Hague has elucidated the situation in Greece, the Southern States of Europe and the Euro zone with great clarity in yesterday’s press. The Euro was seen as a quick route to the USE. It does not work because the successful parts of Europe cannot or will not take ultimate financial responsibility for the less successful parts, as happens in the UK and USA. In Germany for one it is financially and politically un-affordable.

    So what is my answer. First a much diminished Euro area concentrated in the North of Europe. Second to continue with the Free Trade Area under national currencies. Thirdly to only invite countries into the Euro whose economic performance matches that of members of the diminished Euro area. Fourthly, forget about the USE for at least the next hundred years. Finally drop pretentions to a European foreign policy and look to NATO as the body for the continued defence of Europe.

    For the UK I would say, join EFTA/EEA and reclaim our sovereignty unilaterally, so eliminating all those problems within law and emigration we see as caused by our membership of the existing EU. We cannot afford the luxury of playing at being part of a political EU on a path to self destruction.

    • Chris S
      Posted July 8, 2015 at 7:39 am | Permalink

      Well put, I could have written every word !

      • Hope
        Posted July 8, 2015 at 8:11 am | Permalink

        Good view, although paragraph 3 does not fit in with EU expansionism ideology. The EU wants land grab of former Soviet states. Cameron was/is promoting EU expansionism, his Ural speech, his feigned outrage at Russia. But he appears comfortable with Shultz wanting regime change in Greece because it will not do what it is told to do by unelected EU dictators!

        Anyone still trust his negotiating skills?

    • Douglas Carter
      Posted July 8, 2015 at 7:49 am | Permalink

      Whilst I found Hague’s article in The Telegraph welcome in the clarity it laid out, I wish he’d taken more opportunity during his leadership tenure to do the same thing at that time. He trapped himself at the time behind ‘No Euro membership *In the next Parliament*’ and rarely – if ever – went on the public assault demanding figures such as Blair would answer the points he was making.

      Naturally you’d never see anything resembling a candid answer from that source, however, as leadership custodian of the Conservative party, he did at least have the tools at hand to demand proper answers from those who were doing their absolute utmost to undermine his stance at the time within his own party. His internal party referendum over Euro membership was in direct response to the emergence of a possible revolt against the ‘no Euro’ policy within the party by the Europhiles.

      Naming names, he should have assiduously directed figures such as Lords Heseltine, Howe and Brittan, Ken Clarke and Chris Patten (Not a Lord in 2000) to provide authoritative replies to the condundrums he sets out. Being that these people were at the epicentre of party discipline breakdowns at that time, he had ever right to expect them to state their case properly, or in terms of the famous French abbreviation – STFU. Had he done so at that time, possibly it would have encouraged a greater degree of qualified scrutiny of the application by Greece?

    • Mike Stallard
      Posted July 8, 2015 at 8:02 am | Permalink

      Agricola, it does not matter what your – or Mr Cameron’s – thoughts on this matter happen to be.
      The Greek debacle is a distraction.
      While it is being dragged on and on ( the finance involved is pretty much pocket money), the Five Presidents and 100 MEPs have set up a Constitutional Convention (1 June 2015) to draw up a European Federal Constitution for the Eurozone countries and also the “pre-Euro” ones. The EFTA bloc and Britain will be given Associate Membership with limited voting rights. The Constitution is due to be presented in 2017 and brought into play by 2025.
      This makes a lot of sense and will allow both the Euro to work properly and also bring into force the dreams of M. Monnet.

      • Timaction
        Posted July 8, 2015 at 1:53 pm | Permalink

        So why isn’t this important matter being discussed by our MSM. Because we are already effectively living in a dictatorship!

      • agricola
        Posted July 8, 2015 at 3:08 pm | Permalink

        For sure you are right, no one has any interest in what I may think. However if those in the EU fail to read the entrails, they will sail into whatever vision they have in complete ignorance or denial of what the people of Southern Europe think. This could have fatal consequences to their plan A. If plan A is to succeed then you have to take the people with you. It is one of the basic tenets of leadership. Without the support of the people you end up with your knickers round your ankles wondering what happened.

      • Denis Cooper
        Posted July 8, 2015 at 10:58 pm | Permalink

        I wouldn’t be surprised if Elmar Brok was among those 100 MEPs:

        “Federalists urge fast treaty change to stem euro crisis”

        “Member States should fasttrack the reform of the Eurozone into a fully-fledged economic and political union,” said Elmar Brok, German centre-right MEP and President of the Union of European Federalists. “If the Eurozone loses one of its members, financial markets would question whether the Euro really is irreversible.”

        • Peter van Leeuwen
          Posted July 10, 2015 at 4:56 am | Permalink

          @Denis Cooper: neither the fff (fully-fledged federalists) nor the ee (eternal eurosceptics) will get everything they want. Not uncommon in democracies where there is always a range of opinions.

          • Denis Cooper
            Posted July 10, 2015 at 10:36 am | Permalink

            Same old story of systematic deceit from eurofanatics like yourself, Peter, but in this case compressed into a few hours rather than a number of years.

            First of all you assert:

            “A ‘federal United States of Euroland’ is not envisaged”,

            then that changes into some people are envisaging a federal United States of Euroland, but it won’t happen.

            Next it will be that it has happened, and it’s now too late to reverse it.

            We have enough homegrown deceivers, Peter, without you joining in from a foreign shore.

    • Jerry
      Posted July 8, 2015 at 4:10 pm | Permalink

      @agricola; We can not joint either the EFTA or EEA “unilaterally”, we can leave the EU unilaterally – by sorts, using the UN charter with reference to self determination.

      • agricola
        Posted July 9, 2015 at 8:12 am | Permalink

        Read more carefully. It is our sovereignty that I advocate re-claiming unilaterally, for the express purpose of dealing with immigration. Joining EFTA/EEA is between them and us after we leave the EU.

        • Jerry
          Posted July 9, 2015 at 6:17 pm | Permalink

          @agricola; Sorry but joining EFTA/EEA will not reclaim our sovereignty (unilaterally or otherwise), members of the EFTA or EEA still have to adopt many rules and regulations set down by the EU – and as is so regularly, and rightly, pointed out by europhiles- with the EFTA/EEA member countries having little say in the their content or scope.

  10. Lifelogic
    Posted July 8, 2015 at 7:13 am | Permalink

    It is a pathetic situation of endless dithering which is doing huge damage. Merkel says she respects the result of the referendum, but it is up to the nineteen who now have only shared sovereignty.

    Clearly they need to make a clear decision to write of the debt help Greece restructure and go back to its own currency. Perhaps unlike John Major and the ERM fiasco someone will apologise this time?

    • Lifelogic
      Posted July 8, 2015 at 7:25 am | Permalink

      Meanwhile in the budget it seems we will get just more of the same:-

      A delayed, contrived (and far less than even a half way) move towards Osborne’s IHT promise made 8? years ago. Yet further delayed it seems too.

      Further offensive attacks on private sector pensions.

      Retention of the absurdly damaging 45% tax rate.

      This is the time for radical changes and real signals that the UK is actually pro business, but it seem big state socialism will continue with George. He will regret it if he does the tax receipts will not be helped either in the long run. Confidence is what is needed. Will he deliver some confidence boosting changes, it seems not?

      Reply How do you know what is in the budget. I am leaving comment until we know what is in the real budget.

      • Roy Grainger
        Posted July 8, 2015 at 8:24 am | Permalink

        How do we know what’s in the budget ? Because some of the measures have been briefed to the press beforehand as has been common practice for years. Let’s not pretend otherwise. Damian McBride’s book is an interesting read on this topic.

        Reply Lets see how the real thing compares to the press coverage. I suspect there will be some differences.

        • Lifelogic
          Posted July 8, 2015 at 10:30 am | Permalink

          Well we will shortly see, we are long overdue for a real pro growth Tory budget. This is after all the first Tory budget since the EURO/ERM enthusiast disaster that was John Major buried the Tory party back in May 97.

          Osborne should make the most of it, but he shows little sign of even keeping his (8 year old) IHT promise or getting rid of 45%.

          45 % should go, IHT should go and they should stop wasting money hand over fist on green crap, bloated incompetent government, pointless parasites, HS2 and all the rest of the nonsense.

      • Jerry
        Posted July 8, 2015 at 4:15 pm | Permalink

        @JR reply; I write this after the budget speech. Indeed but it would help if some of the press weren’t being feed morsels of (miss-)information, someone in government, party or civil service needs to be sacked!

    • Leslie Singleton
      Posted July 8, 2015 at 8:55 am | Permalink

      Dear Lifelogic–I cannot abide the idea of voluntarily writing off debt. If the Greeks want to default so be it; that’s up to them. NOT the same difference. The process matters lest regular write off becomes part of the norm.

      • Lifelogic
        Posted July 8, 2015 at 10:32 am | Permalink

        The debt clearly will not be repaid anyway, so they might as well just recognise it and move on.

      • Jerry
        Posted July 8, 2015 at 4:17 pm | Permalink

        @Leslie Singleton; The only difference is between a messy default and -in effect- a managed default, I know which one I would prefer!

  11. Douglas Carter
    Posted July 8, 2015 at 7:22 am | Permalink

    As it happens, I’m more gratified by the wave of uncustomary honesty from significant EU figures. Subsequent to the Referendum on sunday, figures such as Martin Schulz, Wolfgang Schauble and ‘people close to Mrs. Merckel’ were variously complaining about the validity of the Greek vote on the basis that ‘eighteen other nations had not also voted on the matter’ (Paraphrase, each comment orbited in eccentric circles around that sentiment).

    It’s pleasing to see how senior EU and German Politicians have quickly become enthusiasts in favour of the national referendum where it pertains to the financial input of their own taxpayers. Better late than never, as they say. I look forward to the German Referendum (after they have changed their constitution, naturally) where the question asked is ‘Do you want a proportion of your tax money to be diverted to support Greece on an indefinite basis?’

    Of course, it would have been more helpful had they offered that Referendum in 2000 where the least damage could have been done. But unfortunately, ‘listening’ was not on the agenda for such people fifteen years ago…..

  12. JimS
    Posted July 8, 2015 at 7:23 am | Permalink

    Ever closer union.
    There is no escape.
    Watch and learn.

    • bigneil
      Posted July 8, 2015 at 8:06 am | Permalink

      The EU dictatorship rumbles on like a steamroller.

    • M Davis
      Posted July 8, 2015 at 8:06 am | Permalink

      … There is no escape. …

      You can check-out any time you like,
      But you can never leave – Welcome to the Hotel European Union!

      • Jerry
        Posted July 8, 2015 at 4:26 pm | Permalink

        @JimS; @M Davis; “There is no escape”

        Wrong, both the EU’s own Article 50, and the UN’s right to self determination suggest otherwise.

  13. Ian wragg
    Posted July 8, 2015 at 7:24 am | Permalink

    Well done Greece for exposing the real EU. Total and absolute obedience of the unelected cabal of ex commies and fellow travelers is required
    CMD still thinks it’s the best thing since sliced bread but I think the natives know better

  14. alan jutson
    Posted July 8, 2015 at 7:35 am | Permalink

    Perhaps MR Cameron will learn a negotiation lesson from Greece.

    Never ever accept the first offer, stick to what you want until you get no more, no more, no more.
    Because that is what real negotiations are like.

    The EU are worried about Greece leaving when they are taking out, just think how worried they would be if someone was going to leave who was actually paying in.

    • Timaction
      Posted July 8, 2015 at 1:55 pm | Permalink

      Why should they worry about the Tory leadership. We all know they’re on side with the EU project, come what may!

  15. David Murfin
    Posted July 8, 2015 at 7:48 am | Permalink

    “This is not a sensible, friendly or effective way to run a single currency.”
    But that is not, and never has been, the aim of the Euro, which is to drive forward a united state.
    There is a rough parallel with effect of the Prussian customs union on the creation of Germany from its constituent states, but at least they all spoke German.

  16. Brian Tomkinson
    Posted July 8, 2015 at 8:11 am | Permalink

    I don’t believe much that the EU says about anything. It is an anti-democratic organisation determind to exert its will over those foolish enough to come under its control.

  17. botogol
    Posted July 8, 2015 at 8:11 am | Permalink

    I think you should decline to publish all comments that start with ‘meanwhile’… 🙂

  18. oldtimer
    Posted July 8, 2015 at 8:22 am | Permalink

    To me it appears that these latest exchanges are and will be about the blame game that is being played. Neither side (of the political class) wants to be seen to be responsible for Grexit so we have to go through the pretense of a new Greek offer, which will fall far short of what the EZ has already rejected. The outcome will be Grexit. The EZ will say that is what the Greeks voted for. Tsipras will say he tried his best – at least he keeps smiling through it all – but was rejected by the EZ. So the politicians will be able to say to the Greek voters – “you voted for it”.

    The one thing we do not know are the terms of Grexit – namely how much practical and financial support the EZ is prepared to offer to accomplish the act.

  19. Ralph Musgrave
    Posted July 8, 2015 at 8:24 am | Permalink

    JR disapproves of “no proper support for Greek banks”. Since any money “loaned” to Greece probably won’t be paid back, any such “support” would effectively be a gift.

    That’s much the same as giving Whiskey to an alcoholic.

    Reply If the Greek banks are solvent as the ECB implies then the ECB should lend to them. If they are not, as their regulator the ECB should sort them out.

    • petermartin2001
      Posted July 8, 2015 at 3:00 pm | Permalink

      Ralph,

      Next time Scotland votes on the question of independence, or possibly wants to push for a better financial deal, would you support the closure of all Scottish banks? Even if we all felt the Scottish government in Hollyrood was behaving unreasonably would it ever be right to deprive Scottish savers of full access to their bank accounts?

      I’m not sure that would even be legally possible in the UK. But even if it were, it would be counterproductive, unethical and damaging to sterling as a currency. It would remove all confidence in the UK’s willingness to be support its own currency.

      All holders of euros in the peripheral countries will be well advised to keep only minimal amount of cash in their bank accounts. They need to look at ways of keeping in in German or Dutch banks. That isn’t doing the Germans or Dutch any favours BTW. It is simply forcing the EU to accept full liability for its issued currency.

  20. acorn
    Posted July 8, 2015 at 8:30 am | Permalink

    I am just waiting to see if the ECB finds a roundabout way to buy Greek Treasury Bonds directly. It is not allowed under ESCB statute, but statutes are broken every day in the EU. If the ECB does not lift the ELA limit, the Greek government could issue further ELA on its own account and effectively, disconnect the Greek Euro from Eurozone Euro.

    I expect the Chinese and the Russians would be in there like a shot, offering credit and payment clearing facilities. The US would create another Greek military coup to stop them and get “regime change” to protect US global hegemonic interests.

    Nobody polices the ECB anyway, it basically does what it wants. As others are saying this week, the ECB is actually the federal government of the Eurozone, it directs both monetary and fiscal policy. It buys a lot of corporate Bonds that take interest payments out of the private sector and into the public sector. Mostly outside of any democratic control; only challenged by the ECJ.

  21. Ken Moore
    Posted July 8, 2015 at 8:35 am | Permalink

    The Euro elites are very very dangerous people. Many are former communists that must relish the prospect of a return to the ‘good old day’s of absolute state control, and indeed they must feel rather nostalgic seeing how events are turning out for the Greeks.

    (E.g. Left out ed)
    Why are we at all surprised that if you follow a communist inspired doctrine of state control you get all the problems that followed in the past.
    (X)is a former Maoist – do we really want to be led by these people ?.
    How could we have been so foolish to let these people gain such influence over our affairs?.

    These people are prepared to do almost anything to keep the Euro dream alive – buy back their own debt, push millions out of work, ignore democracy….But reason and logic always take a back seat to ideology however warped it might be…

    I see through these people as I suspect John Redwood does. But I get no sense that David Cameron does – he’s just going through the motions to pretend to do something.
    That worries me.

  22. CdBrux
    Posted July 8, 2015 at 8:36 am | Permalink

    I heard on Belgian radio this morning that there is to be a summit on Sunday of ALL the EU states, not just the eurozone, along with a suggestion that if Grexit comes along then there could be consideration to give some sort of ‘aid’ money to Greece to help it’s citizens through clearly difficult times.

    So there is a risk with Grexit that it is all the EU members and not just the EZ members that end up paying for what should be just an EZ problem (if they faced up to their obligations that should come with a single currency)!

    Reply I trust not, but the exit will have knock on effects on the rest of the EU and if the Eurozone briefers meant it when they said they want Greece out of the EU as well that also is a matter for all the EU states.

  23. Bert Young
    Posted July 8, 2015 at 8:37 am | Permalink

    I believe the ” No ” vote in Greece was seen by the EZ as the signal that Grexit was inevitable , but , following the meeting of Merkel and Hollande which did not produce an accord and the intervention of Obama , a rethink began .

    Merkel knows very well that she is unlikely to obtain a nod from her Government – the opposition has hardened against helping Greece ; other countries too have signalled their unwillingness to bail Greece out so , overall , it looks as though Greece will not be able to stay in the EZ .

    With the intervention of Obama , the continuing turmoil in the Ukraine and little defence capability of its own , Germany may give in and allow the ECB to give Greece its finance . That the EZ is doomed to fail as it is presently constructed is not doubted – all sensible outsiders and economists agree , but politicians have now pressured otherwise and ,for the meantime , will really decide how things will turn out .

    The EU is a defunct organisation that only hangs on with the thinnest of values . The base core of Germany and France still only exists on what the Common Agricultural Policy means to France and Germany’s need to be seen as a conciliatory nation to the rest of Europe . This relationship is now worn at the edges .Germany will value its reserves ahead of other considerations and will eventually allow the EZ to collapse .

  24. bluedog
    Posted July 8, 2015 at 8:40 am | Permalink

    It is an absolutely disgraceful situation, Dr JR. In the view of this writer, whether the EU leadership understand it or not, the ground is being prepared for a loss of confidence in the ECB. This could be a potentially catastrophic development for the European economy, but who would seriously lend this entity another centime today?

  25. Richard
    Posted July 8, 2015 at 8:48 am | Permalink

    Either the EU must continue to pay for Greece or eject it from the Eurozone.

    The former will cause Mrs. Merkel problems with her electorate particularly if they believe that other EU countries will follow Greece’s example. It may even result in Germany leaving the Eurozone.

    The EU is worried that ejecting Greece from the Eurozone will look like their empire is declining.

    And the EU will be worried that other countries may wish to leave the Eurozone when they see how much better Greece’s situation becomes when it returns to its own currency and is no longer under so much EU control.

    • CdBrux
      Posted July 8, 2015 at 9:58 am | Permalink

      The EU would be worried about that, but maybe less so if Syriza stay in charge!

  26. PayDirt
    Posted July 8, 2015 at 8:57 am | Permalink

    Greek Govt debt is approaching 350 billion Euros, I read that more than 60% of that is owned by EZ member states. If there is outright default, how are Germany/France/Italy/Spain etc going to account for the write-downs? These are significant numbers, eg about 3% of each country’s GDP.

    • Nick
      Posted July 8, 2015 at 11:40 am | Permalink

      Only 350 bn? Dream on.

      2% of the GDP goes on the borrowing. 18% goes on the other debt, pensions.

      So their total debt is around the 3,500 bn Euro mark.

      Most of that debt is the Greek state owing Greeks.

      Just like the UK.

    • Denis Cooper
      Posted July 8, 2015 at 11:05 pm | Permalink

      It’s a bit more than €1000 per man, woman and child in the eurozone.

  27. DaveM
    Posted July 8, 2015 at 9:08 am | Permalink

    God this is getting boring. Can’t even be bothered to think through the blindingly obvious permutations, scenarios, and motivations of the various parties. Ultimately, though, the EU and EZ has caused more problems than it’s fixed – in any sphere outside the madness of EU politics such an organisation would have been disbanded by now, with damage control as the primary aim. I just hope our govt is taking notes for when it takes the suicidal step of granting Scotland full fiscal and spending freedom with the pound sterling.

  28. English Pensioner
    Posted July 8, 2015 at 9:12 am | Permalink

    It’s the old story – If you owe the bank manager a Thousand pounds, it’s your worry; If you owe the bank manager a Million pounds, it’s his worry.
    Greece owes so much that there seems little chance of their bank managers ever getting it back and any sanctions that the Eurozone or IMF impose such as more austerity will simply make things worse. At the same time, the Eurozone seem desperate to keep Greece in the Euro for political reasons, mainly to “prove” that a common currency can work. My feeling is that the whole farce will drag on for some time yet with more deadlines and yet more meetings.
    What it does show is that when Cameron comes to negotiate changes in the EU he should be able to get a very good deal. If little Greece can cause the EU so much trouble, a country like ours, with a decent economy, which contributes to the EU should be able to get almost any deal that it wants. Certainly Cameron should flatly refuse the first offer from the EU, and indeed reject the “final” offer from the EU as there will always be more if necessary to stop the EU falling apart.

    • Graham
      Posted July 8, 2015 at 10:10 am | Permalink

      You are so right.

      Unfortunately we have a negotiator who has already agreed not to leave and couldn’t negotiate his way out of a paper bag.

      I can think of many MD”s in my working life who given the position you correctly outline would take the EU to the cleaners – with fire in the belly!!!

  29. Kenneth
    Posted July 8, 2015 at 9:17 am | Permalink

    This is hopeless.

    The conflict between national interests and so-called solidarity can never be reconciled. The wide gulf between the opinions of the average Greek voter versus the average German or Dutch voter is sowing the seeds of division across Europe.

    We must get the eu out of Europe.

  30. Mark
    Posted July 8, 2015 at 9:33 am | Permalink

    Aren’t we just seeing a delay while the necessary banking arrangements for Grexit are put in place?

    I expect EU heads of government will be told on Sunday what they’re expected to contribute to recapitalise the ECB. I hope Osborne has budgeted for it: we have a 13% share of the bank, so it could easily amount to £10-20bn.

    Reply Not so. Our capital is not paid up so our share is tiny and we are not liable for any ECB losses.

  31. fedupsoutherner
    Posted July 8, 2015 at 9:51 am | Permalink

    Listening to Junckers on the TV this morning would be enough to put me of negotiations with anyone in the EU if he was involved! What a horrible little upstart he is!! Rude and arrogant and having no tact.

  32. CHRISTOPHER HOUSTON
    Posted July 8, 2015 at 10:02 am | Permalink

    The internal/external to-ings and fro-ings of the EU and Greece. The last chance saloon threats by broadly unknown faces and personalities in the EU Parliament. Yawn. Our media makes it simpler and more real by continually showing pictures of Mrs Merkel and Mr Hollande having meetings.
    To many, they ARE the EU. Some, who have bothered to listen at all, are amused to discover Mr Hollande is not a country in his own right in the nether regions of the world but a President.

    The disconnectedness of politicians and our people on this tiny island is worsening. The British Parliament was charged with being a talking shop. It may be, but no-one bothers shopping at the European talking shop. Democratic and emotional connection to the EU personalities and government bodies are virtually non-existent. The EU Parliament,its bodies, their relationship to the common man, are but a stick-diagram.

    Here in our UK home, politicians, the SNP in particular, have merely complicated and made unfathomable what relates to what in what was always a complicated society-political.

    There may not be a solution to this problem. Possibly small works better than large.

  33. JJE
    Posted July 8, 2015 at 10:07 am | Permalink

    While we are all busy looking at Greece the markets in China are having a severe correction. I expect this will have a greater impact on the world economy

  34. Colin Hart
    Posted July 8, 2015 at 10:51 am | Permalink

    William Hague’s recollections would be more credible if he had not been responsible for the slogan ‘In Europe but not run by Europe’. This was and is a contradiction in terms. Witness how our own dear PM has to drop everything and take part in an emergency heads of government meeting this Sunday to be party to a decision about the Euro. He should politely decline or and let Angela know privately this is her problem, nothing to do with us and we are in no way responsible for what they decide and its consequences.

  35. matthu
    Posted July 8, 2015 at 12:58 pm | Permalink

    The one intriguing thing is that ALL EU leaders have been asked to attend the meeting on Sunday, not just Eurozone leaders.

    This must surely mean some legal amendment (treaty amendment in all but name) is on the cards that will need to be agreed by all members before some or other EU institution is allowed to take some or other action in order to keep Greece in the Euro (or allow them temporaily to leave, with options to return etc.)

    Will UK parliament need to agree any changes?

    If so, will they? You bet.

  36. NickW
    Posted July 8, 2015 at 1:27 pm | Permalink

    We were led to believe that when we surrendered our sovereignty to the EU, that we would be better governed as a result, because European politicians were Supermen who would not make mistakes and were infinitely more competent than the politicians in National Governments. What a joke!

    Given that most European politicians are actually electoral rejects, this was an implausible proposition from the very beginning, although it does go a long way towards explaining the EU’s aversion to democracy.

    Once having determined that EU politicians are not deities gifted with superhuman powers, we then have to accept that they will make mistakes, and get things wrong.

    It would be infinitely better if we went back to the situation where human errors only trashed individual nations rather than trashing the whole of Europe in one almighty cataclysm.

    Europe is a disaster area, but were the UK to have been sucked into the vortex of predictable catastrophe represented by the Eurozone, things would have been infinitely worse.

    What the world needs is small units of governance which co-operate with each other; not superstates which have the ability to crash entire continents.

  37. mick
    Posted July 8, 2015 at 1:46 pm | Permalink

    Even though the people of Greece voted NO the EU are taking no notice of the democratic result, a deal will be done to keep them in the Euro, you can only imagine the under hand back stabbing that will take place when we have our referendum and vote to leave, there is no way they are going to let a top contributor leave without a bloody fight

  38. Mark B
    Posted July 8, 2015 at 5:02 pm | Permalink

    Good afternoon.

    I think Greece has just called the EU’s bluff.

    I have said it here and elsewhere. If the Greeks were to tell the EU that they did not want to be part of either the EU or the Euro, the EU would bend over backwards to keep them in.

    And so it is proving to be.

    The thing is, the Greeks are really fighting for something rather than pretending.

    😉

  39. Lindsay McDougall
    Posted July 8, 2015 at 11:02 pm | Permalink

    Nigel Farage said roughly the same to the European Parliament. The difference was that Mr Tsipras was in attendance and Mr Farage concluded with words to the effect of “Come on out, the water’s lovely.”

    Mr Tsipras preserved a poker face. I wonder what he was thinking.

  40. Ken Moore
    Posted July 9, 2015 at 6:59 am | Permalink

    I note my post yesterday has been deleted making a few observations about the Communist/Maiost past of several important Euro figureheads. These are all well documented facts, not in any way libellous and of genuine public interest/relevance to the Eu debate.

    Poor form Dr Redwood there is no reason to censor well documented facts.

    Reply I cannot prove them myself and do not have the time to deal with any kick back from the individuals concerned if they are questionable facts.

    • Ken Moore
      Posted July 9, 2015 at 9:31 pm | Permalink

      Thank you Dr Redwood.

      I recognise your concerns but in an age where Eurosceptics have been classified as ‘extremists’ and ‘headbangers’ for wanting to withdraw from the EU, perhaps we should be a little more robust in our defence and examine the history of the senior Eu members more carefully.

      I for one don’t want to be governed by an unelected commission – let alone one with members that have links to Maoist and Communist party’s in their distant past.

      To imprison ourselves within this socialist state and give away our sovereignty IS the extreme position. In my view the success of the OUT campaign will hinge upon getting this message across.

      The Eu is looking more and more like a failed communist state by the day – perhaps we should ask questions about the ideology that is driving this ?..an ideology so powerful that it has crippled Greece…

      Mr Barroso can speak for himself

  41. agricola
    Posted July 9, 2015 at 8:18 am | Permalink

    yesterday and now on U-Tube, Nigel Farage gave a brilliant speech to the EU Parliament exposing the total fallacy of the Euro and it’s detrimental effect on Southern Europe. It closed with spontaneous applause. I only wish he were in the H o C to shred the misguided Europhile camp.

  42. Lindsay McDougall
    Posted July 9, 2015 at 12:20 pm | Permalink

    The thing that people keep failing to mention (or consider?) is that there is no concensus among OTHER Member States for the Euro to become a soft currency. Germany, Finland etc are particularly strong on the Euro remaining a hard currency.

    If EU Member States are allowed large fiscal deficits, then sooner or later, by one mechanism or other, the ECB will be forced to print extra Euros to finance these deficits and the Euro will become a soft currency.

    Greece cheated its way into the Euro zone and has never played by the rules. A forced Grexit is both likely and just.

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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