How much more damage is the Euro going to do?

So they lied again. There is no agreed deal or Grexit this morning, after all that briefing about the crucial summit and the final decision. No wonder fewer now believe them. How can you run a currency and a banking system when the authorities are so visibly unable to deliver what they promise? It’s time they asked themselves some more fundamental questions.
Is there any level of youth unemployment that might make the Euro area change policy? Apparently a majority of young people out of work in some countries is fine.
Is there any level of general unemployment that could cause a change of heart? Unemployment of 25% is acceptable in southern countries to the Euro leaders.
Is there any degree of disruption of banks that is too high a price to pay? The Cypriot banks were closed down and offered limited withdrawal for weeks, and now the Greeks have had two weeks with no functioning banks. Is this satisfactory in a first world currency system?
Is there any limit to how much money people and companies can lose by depositing euros in a Euro area regulated bank? In Cyprus larger depositors lost half their money. In Greece depositors have been unable to withdraw their money for two weeks.
Is there any limit to the inequalities around the zone? Is it acceptable that benefit levels and wages are so much lower in the east and south than they are in the north?
Is there any limit to how large the German surplus has become? How can the zone function properly when its largest area amasses an ever larger surplus earned by exporting to the rest, but is unwilling to recycle the money?
Is there any concern amongst the zone’s leadership that it is throttling democracy? What is the point of a Greek referendum or an Italian or Spanish election, when economic policy is dictated from Brussels whatever voters might want?

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205 Comments

  1. Posted July 13, 2015 at 5:22 am | Permalink

    All very true but since when has the EU bothered about whether something actually works or makes any sense? From CAP, fishing, green crap, working time directives, theERM to endless other complete insanities.

    • Posted July 13, 2015 at 10:50 am | Permalink

      Shouldn’t you be asking your Europhile leadership these questions Mr Redwood?
      You are in the wrong party. One that agrees £12 billion in foreign aid, £14.5 billion in EU aid then claims to ring fence 2% GDP for our defence. UKIP today unearthed Osborne’s stealth that this now includes intelligence and security services in that 2%. Oh so generous in wasting our borrowed taxes to give away to foreign causes whilst we live in an age when we are most at risk. Cut Police and defence spending whilst creating through foreign policy the worst security threats in a generation! The Country is being run by fools who have never had proper jobs or experience and we wonder why we’re in such a mess? It’s not my fault I voted UKIP!

      Reply NO it does not include non military intelligence spending! It is all done on NATO definitions. Some of the increase goes to a joint military/intelligence budget,. but only the military part counts towards the 2%. If you want to be critical do try reading the detail first.

      • Posted July 13, 2015 at 12:24 pm | Permalink

        This is a vindictive destruction of a sovereign nation. There is no hope of Greece being able to pay but must suffer to act as a warning to other countries who dare challenge the EU. This is a coup to make an elected government do as it is told by EU fanatics who forget the reasons they allegedly created this mess in the first place!

        Where is our head of government challenging this inappropriate behaviour? All your questions need to be answered by him and now demand what his alleged renegotiation is? Boris Johnson asks in his article where are the leaders from othe European countries rallying to help Greece? Answer they stood idly by to allow the vindictive submission of a national government for a fanatical policy dream which is dominated by Germany, aided by the IMF.

        In relation to your point above, it needs to be asked why perfectly good Nymrods were destroyed by a digger behind curtains in 2010, why the U.S. was allowed to buy jump jets at a ridiculous price when our aircraft carriers have no planes! It is a perfectly valid point why Cameron is prepared to waste about £28 billion on overseas aid and the EU, plus extra demands, while the UK is not able to provide basic security for this nation or to secure its borders, count people in and out when our taxes are increased to be given away to countries who are increasing their police spending, in reign the or defence spending and providing infrastructure for countries in the EU to buy their loyalty with our taxes!

      • Posted July 13, 2015 at 4:30 pm | Permalink

        To second Timeaction, what is the purpose of this type of daily blog. We all know the Euro situation is bad, that it is not something that the UK would ever want to join. But you have already made this point hundreds of times. And you are on this blog mainly addressing convinced people.

        Are you feeling so weak in your positions that you need this daily dose of “support” to go on? Or are you a true Europhile whose heart is presently bleeding?
        Whatever the case, I am a bit disappointed.

        • Posted July 14, 2015 at 12:16 pm | Permalink

          Totally disagree. JR provides an invaluable commentary on events and generously provides the opportunity for others to add their own commentaries, which may supplement his or may contradict it; we should all be grateful for that, and hope that he will choose to continue to provide this service, which he does at his own expense in both time and money.

      • Posted July 13, 2015 at 6:57 pm | Permalink

        What does this say then?

        http://www.ft.com/cms/s/0/598d070a-257e-11e5-bd83-71cb60e8f08c.html

        Your Government have changed the rules to include spending that didn’t previously count as defence spending!

        • Posted July 14, 2015 at 7:38 am | Permalink

          It now emerges that Greece will be supervised and the supervisors the right to veto laws! Laws created since January will be repealed. If this is not a coup by economic and financial pressure I do not know what is.

          If Germany can play in a mean spirited way to dominate the EU where is the political back bone of Cameron to actually achieve anything? Or is it more of a question that he does not intend to. His comments about this situation were beyond pathetic. Lawson is right with his fears that Cameron will do nothing or use the situation for our country’s benefit. I suspect we will see the roll over belly up prose of Cameron before giving away billions more of our hard earned taxes to the dictatorship called the EU.

  2. Posted July 13, 2015 at 5:42 am | Permalink

    I had hoped that the Greek government had understood responsibility to their electorate when they called the referendum, but it’s not a surprise that the result hasn’t really mattered.

    The Greeks joined the EU to win free money; the EU let them in because they expect to dictate what to do successfully. It’s a marriage – aisle, alter, hymn…. Either the EZ (especially Germany) has to accept that money sent to Greece is a gift, or the Greeks have to work out a whole new way of life.

    Neither will happen, but the EU has to prove that it’s infallible. No matter what the problem, the solution is to have more Europe. The population of Greece is a mere pawn in the game.

    Let there be (more) fudge….

    • Posted July 13, 2015 at 12:30 pm | Permalink

      The EU had no regard for the Greek people or the will of sovereign nation. It wanted to make an example of it. Those countries who stood idly by, or ably assisted like the U.S., including the UK, should hang their heads in shame. It should be clear to all these people are fanatics. Look at the language of Junker and Shultz and the threats made. Greece must feel the world is against them.

      Interesting articles not the DT including comments from Swiss and Norwegian politicians encouraging the UK to leave the EU and join them outside.

    • Posted July 13, 2015 at 4:05 pm | Permalink

      Even Caroline Lucas speaks out about the conduct of the EU coup of a sovereign nation. Lawson speaks out and advises how Cameron should use this time for a proper negotiation not the watered down acceptance of trivia without treaty change Cameron accepts instead of removing ever closer union.

      Today Britian for Business highlights how much the EU costs us per household and how the budget recognises the EU will demand extra taxpayers’ money from the UK.

      Cameron remains quiet and subservient ready to obey.

  3. Posted July 13, 2015 at 5:44 am | Permalink

    What is the point of democratic national governments who are powerless in the face of the EU?

    • Posted July 13, 2015 at 8:08 am | Permalink

      There isn’t any.

      • Posted July 13, 2015 at 12:34 pm | Permalink

        It is becoming clear to people that our elections are pointless if you vote for the LibLabCON cartel. All these politicos want is to implement EU orders while being paid handsomely and enjoying the kudos of the position. It was reported over the weekend there are now not enough seats in the Lords. Why do we need so many politicians to enact EU orders. Osborne wants more for his dissolution plan of England.

  4. Posted July 13, 2015 at 5:46 am | Permalink

    John, you are confusing the EU leaders, by presenting them with facts.
    The euro is a political construct and many politicians, unlike yourself, don’t do facts.

    • Posted July 13, 2015 at 10:23 am | Permalink

      Yes you have got to admire the brass neck of Mr Donald Tusk’s finger wagging at the Greeks over the weekend. It was not too long ago that Poland was also relieved of many of its debts. While in the meantime Poland dumps its surplus labour on Western Europe. The economy is also held together with welfare receipts picked up by his compatriots, whether they can be bothered to work here or not and their kids need not even leave (etc ed) Warsaw to pick up some more.

  5. Posted July 13, 2015 at 6:13 am | Permalink

    The Guardian comments section today reads like the UKIP chatboard, loads of puzzled lefties saying “I supported the EU before but now I think I might vote NO”. I suppose the chances of Cameron scheduling our referendum any time before December 2017 are small, he’ll want all this to blow over first.

    • Posted July 13, 2015 at 9:50 am | Permalink

      Take away the posh accent and the fact that he already has the top job and David Cameron would be a shoe in leader of the Labour party :-

      Guardian reader : check , believes in big government and Govt setting wages : check , mass immigration : check , believes in a totalitarian European superstate : check .

      Like his mentor Anthony , he’s not encumbered by principles either so would be electable .

      How ironic though that just as Cameron’s EUphilia is reaching a peak the hard left are rejecting it again !

    • Posted July 13, 2015 at 8:53 pm | Permalink

      It may not blow over. I think Schauble and Juncker have recruited a swathe of the left to the Eurosceptic cause.

      I used to be very pro-European, and there are many good things about the EU – but there is an awful lot of bad. Once you’ve noticed the bad, it is difficult to overlook it. So it may be for our outraged Guardian reading friends.

      The EU’s scheme to tear up the understanding with the UK over the European Stability Fund is also rather well timed considering the PM’s negotiations.

      As GWB once said “Fool me once, shame on, shame on you. Fool me, you can’t get fooled again.”

  6. Posted July 13, 2015 at 6:16 am | Permalink

    The simple truth John is that all of a sudden politicians have started to think a little more Nationalistic rather than simple group think.
    They are now probably thinking (all be it in the back of their minds) about their own future general elections and the actions of their own people, and re-election to their position of power.

    When the chips are really down and hard decisions have to be taken, then group think starts to break down.

    Just as a small company can implement and carry out management decisions rapidly, the larger organisations take a little more time to make a decision and adjust, and when that involves 19 Countries it could take forever unless its a simple majority vote, and that would breed further trouble.

    They all want to keep Greece in the Euro, otherwise it admits a failure of past policy, but no one really wants to pay.

    In the meantime the Greek Government, elected recently on a wave of no austerity, (we do not want to live within our means) is facing the reality of their own silly promises.

    With politics, commonness often goes out of the window.

    • Posted July 13, 2015 at 11:48 am | Permalink

      Agreed Alan.
      Easy to be friendly when times are good but not to easy when large sums of money are being called for.
      Who will be first (and last) to get their cheque books out?
      Same at EU level as it is being a Director of a small company.

  7. Posted July 13, 2015 at 6:17 am | Permalink

    Good morning.

    We of course have had our own banking troubles where people have been shut out of their money. Well worth remembering that.

    The last line of this piece syays it all. What is the point of referendums and elections if everything is run from Brussels / Strasburg ? And the answer ? None at all. And that lasies and gentlemen is the whole point. And that is why I believe referendums and the like are just a waste of time.

    What we are witnessing, although few really seem to have grasped it, is the dawn of our new future. A future were our once servents have become our masters.

    But it does not have to be like this.#

    Reply NO depositor in a UK bank has been stopped withdrawing or has lost any of their deposit.

    • Posted July 13, 2015 at 8:09 am | Permalink

      @ Reply – you mean so far! Some who thought they had the guarantee of HM Treasury through the FSCS may lose out when that guarantee amount is unilaterally revised downward.

      • Posted July 13, 2015 at 12:47 pm | Permalink

        Cameron has given HMRC power to take your money without proper judicial process, he has allowed the state to spy on your personal emIls and given every backwater country the right to whisk you off without evidence substantiate in this country. He then has the gall to talk about Magna Carta!

        A bit like his criticism of his opponents on TV that they represent more debt and more taxes. JR has highlighted for us in his blogs that Cameron is far worse than those he criticises because he claims one thing then implements what he criticises others for ie more debt and more taxes. His chancellor consistently makes false claims about the debt and deficit! Where are we with the 80/20 split on spending cuts versus tax rises, not the subsequent weasel words. Osborne’s structural deficit balance by 2015 just a pipe dream. He now claims it will be 2019/2020 while commentators suggest it will not happen. Talks a lot and delivers nothing.

      • Posted July 13, 2015 at 5:23 pm | Permalink

        Formula57: The FSCS guarantee reduction is not “unilateral”. The EU has set a normative compensation level of 100,000 Euros.

    • Posted July 13, 2015 at 10:20 am | Permalink

      Mark B. A good well reasoned calm comment. The reply you received seems to reflect a lack of empathy from those who really should know better.

      • Posted July 13, 2015 at 6:39 pm | Permalink

        Yulway Martyn

        It may have been a calm statement from Mark B trouble is its just plain wrong. The only people shut out of Bank accounts were customers of the EU’s favourite bank RBS and that was another IT failure.

        The second paragraph is far from reasoned in fact the point of a referendum is to REMOVE us from this politburo dictatorship OR to sign up lock stock and barrel to a new country.

        Not a lot to empathise with in that post.

    • Posted July 13, 2015 at 12:20 pm | Permalink

      “Reply NO depositor in a UK bank has been stopped withdrawing or has lost any of their deposit.”

      Completely disingenuous. Rates have been held, by decree, lower than inflation for at least 7 years and savings have been confiscated by this mechanism and transferred to a housing bubble. In real terms, the only terms that matter , bank deposits have been lost.

    • Posted July 13, 2015 at 7:33 pm | Permalink

      Reply to reply.

      So the people lining outside closed Norther Rock banks where just a figment of my imagination ?

      Thanks.

      Oh ! And I speak as someone who WAS locked outside from accessing his money. I was Icesave, although was not British, did come under UK banking rules and was given a UK banking licence.

      Reply No one lost money in a UK bank

      • Posted July 14, 2015 at 12:26 pm | Permalink

        That was the first bank run in the UK for 150 years, not bad going.

      • Posted July 14, 2015 at 3:14 pm | Permalink

        Mark B

        You had to stand in a queue !!!! You got your money. The rest of the country took a haircut so you could get your money so I’m not really sure what you are whining about. You should be saying thank you to the rest of us

  8. Posted July 13, 2015 at 6:27 am | Permalink

    JR: “Is there any limit to how much money people and companies can lose by depositing euros in a Euro area regulated bank? ”

    Under the policies you approve of, the value of your money has been reduced by over 9000% since 1913.

    What is the difference between the policies you and your government approve of and the policies of the Trokia toward Greece?

    Reply Losing value through mild inflation is altogether different from having your deposits stolen, though I favour low inflation as policy.

    • Posted July 13, 2015 at 8:48 am | Permalink

      Well, I was watching “Edwardian Farm” and the latest invention for domestic convenience, a non-electric automatic teamaking device, cost £2 which was said to be about twice the typical worker’s weekly earnings of 20 shillings, so you could adjust your 9000% devaluation of the currency for a 50000% increase in earnings. Nor do I think that JR would have approved of any of the policies which had the greatest impact on consumer inflation in the UK, namely a deranged Kaiser invading Belgium, an insane Hitler invading Poland, mad Marxist trade union barons thinking they should run the country rather than its elected government, and a much more sane Sheik Yamani arranging for massive increases in the international price of oil.

      • Posted July 13, 2015 at 12:51 pm | Permalink

        Rogue HMRC claims and takes your money without just cause! £750 million spent on HMRC staff yet Cameron cannot and will not secure and control our borders to make us safe. He will not prevent EU criminals entering the country or have them monitored by their host nation. No, they are free to commit crime. EU students freely give tuition fees while English students given a life time of debt, more taxes more debt. This is Cameron’s all in it together.

        • Posted July 15, 2015 at 7:39 pm | Permalink

          Yet still HMRC are virtually unable to answer the phone lines. Still less answer them with anyone who has a clue what they are talking about.

      • Posted July 13, 2015 at 8:34 pm | Permalink

        Denis Cooper: “namely a deranged Kaiser invading Belgium, an insane Hitler invading Poland,”

        And it’s likely the second was a direct result of the former. So perhaps we should have left well alone in the first case.

        But the big rise in inflation kicked off in the ’60s

        Denis Cooper: “and a much more sane Sheik Yamani arranging for massive increases in the international price of oil.”

        Before the ’73 oil crisis we appeared to be getting oil at below the market rate from the middle east. After, well it isn’t often that oil has traded it’s pre ’73 price of $3

        Are you making the case that we were correct to strip the Arabs of their oil at below market rates?

        • Posted July 14, 2015 at 12:36 pm | Permalink

          I’ve merely pointed out three major inflationary episodes which had essentially external causes and were nothing to do with policies which JR espoused or would have espoused, as you suggested.

          Of course we could have stood back and allowed the maniacs who had control of Germany to achieve complete domination of the continental mainland, before they later came for us islanders, indeed present government policy is rather like that.

          You may have noticed that I described Sheikh Yamani as “much more sane” than the Kaiser and Hitler, so that in itself should have been enough to answer your last question.

          Reply Indeed there is no comparison between Hitler and the Sheik.

    • Posted July 13, 2015 at 9:32 am | Permalink

      I wouldn’t agree that the 25% devaluation that sterling suffered after the financial crisis was “mild inflation”. It is quite close to having your deposits stolen. Devaluation also “steals” the value of peoples’ earnings.

      One of the reasons that the Greeks seem to want to stay in the euro is apparently because they fear the persistent “theft” that would be brought about by the subsequent devaluations of the drachma.

      We should not fool ourselves into thinking that our economy has been so well run that we have had a completely fair way out of the crisis. We too seem to have a system where the poor and powerless suffer and pay for the faults of the rich and powerful.

      • Posted July 13, 2015 at 4:55 pm | Permalink

        Alan, the fundamental problem of the Eurozone, incompatible economies.

        We collectively, can’t say that Germany has got it right and Greece has got it wrong, (unless you are a raving neo-liberal). It’s chalk and cheese. The whole idea of putting them in the same currency zone was silly.

        IMO Nation states should have their own “sovereign” currency, that is allowed to float in an exchange mechanism, that reflects global balance of payments requirements, NOT a casino banking environment as now. I have said before on this site that the total amount of foreign exchange needed for global trade, in a year, is turned over in four days on the FX market. The rest of the year, is pure casino gambling that disregards any socio-economic fundamentals of the people who own a particular currency.

        If your currency devalues over time, it is the rest of the world telling you that you are getting it wrong somewhere. Nobody has a need to buy your currency. Nobody wants to sell you stuff and end up holding your currency. If you are a major importer from a particular country, that country’s central bank, has decided it is not prepared to keep buying up your currency, to raise its value, so you can keep importing its stuff.

        It will be interesting to see which countries dive into Greece to buy up, at fire sale prices, the €50 billion of Greek state assets to part finance the ESM bail-out fund. Most of which will go to bail-out French and German etc Banks, just like the last two bail-outs did. Alas, this is all par for the course in a neo-liberal dominant world.

        • Posted July 14, 2015 at 3:17 pm | Permalink

          Acorn

          I fairly much agree with most of your post but is Neo- Liberal your word of the month? Why detract from important points with meaningless terms ?

          • Posted July 15, 2015 at 6:32 am | Permalink

            Libby, everytime you post, you further demonstrate your economic ignorance. Neo-Liberalism is a branch of Capitalism invented by Adam Smith. It combines Neo-Classical economics with plain vanilla Laissez-Faire economics.

            Neo-Liberalism is the dominant form of governance in the western world today. The UK Conservative Party is a text book example of the ideology. Investopedia describes it; “… neoliberalism suggests that governments reduce deficit spending, limit subsidies, reform tax law to broaden the tax base, remove fixed exchange rates, open up markets to trade by limiting protectionism, privatize state-run businesses, allow private property and back deregulation”.

            PS. A “libertarian” can be left wing or right wing. etc ed

      • Posted July 13, 2015 at 6:11 pm | Permalink

        Slight misunderstanding here; that 25% reduction in the external value of sterling did not mean 25% added to domestic consumer inflation, or in other words a 25% reduction in the purchasing power of someone living in the UK whose income and outgoings were denominated in sterling, but only about a quarter of that, according to the “pass-through coefficient” estimated by the Bank of England, which is about 27%, spread over several years:

        http://www.bankofengland.co.uk/publications/Documents/speeches/2014/speech760.pdf

        And moreover that drop in sterling was from it being over-valued to being under-valued and about two thirds of it has since been reversed.

        Meanwhile, you might be so happy with the decline in the external value of the euro over recent years.

    • Posted July 13, 2015 at 8:10 pm | Permalink

      JR: “Losing value through mild inflation is altogether different from having your deposits stolen, though I favour low inflation as policy.”

      I love the your use of the term ‘Losing’ as if it were some absent mindedness of the average British subject.

      It’s odd to see the term ‘mild inflation’, used to describe depreciation of 9000% + since 1913** but most of it occurring since 1960. I’d hate to think what you might consider ‘rampant’ inflation.

      The cumulative effect of your preferred ‘mild inflation’ policies has been an excess of 9000% devaluation of the £ sterling.

      What’s the matter with ‘mild deflation’? I have never yet heard you or anyone else complain that the computer hardware you buy, is more powerful and costs less than the previous similar purchase.

      JR: “losing’ and ‘mild inflation’

      You mean deliberate theft, and calculated government policy respectively.

      **Bank of England figures.

      • Posted July 14, 2015 at 7:48 am | Permalink

        politicians and bankers love theft of deposits by inflation. It allows them to mostly get away with the lie, let’s call it what it is, that there is no theft of deposits.

        really , we have to evolve away from this system of deception(and theft) and have direct democracy. Representative democracy is a dinosaur from an era before effective communications

      • Posted July 14, 2015 at 3:06 pm | Permalink

        Nevertheless people are a lot better off now than they were in 1913.

        • Posted July 15, 2015 at 6:11 am | Permalink

          Denis Cooper: “Nevertheless people are a lot better off now than they were in 1913.”

          As the Greeks are finding out, their pretend affluence built as it has been on lies, deception and fraud, wasn’t cost free.

          They are now paying the price, as our children will be forced to pay the price.

          You are simply making the case that it’s ok to live at the expense of our children and grandchildren.

          • Posted July 15, 2015 at 12:19 pm | Permalink

            Nope, people are a lot better off now mainly through real technological advances, not through loading debts onto their descendants. That is why the automatic tea-making machine featured on that programme now looks like an absurd Heath Robinson contraption.

          • Posted July 16, 2015 at 6:26 am | Permalink

            Denis Cooper: “That is why the automatic tea-making machine featured on that programme now looks like an absurd Heath Robinson contraption.”

            OK, but it was a product of it’s time, and the level of technology avaliable then. It really doesn’t matter that it looks absurd to us today.

          • Posted July 16, 2015 at 3:33 pm | Permalink

            Missing the point again. We are much better off than our grandparents were in 1913 mainly because of technological advances, which would make them boggle at our present lifestyle, and not because we have loaded debt on to our grandchildren as you suggest. And while there can be no guarantee that it will happen I guess that by the time they are themselves old they will also be amazed at how the world has changed during their lifetimes through further technological advances.

  9. Posted July 13, 2015 at 6:47 am | Permalink

    The original concept of the European Economic Community, and then the EU, was about utter control by the State and against economic liberalism, world trade and the concepts of Anglo-Saxon notions of individuality, a balance of powers internationally and democracy.

    This concept was promoted and supported by fascist politicians, economists and industrialists of varied European backgrounds in the 1930’s and 40’s, (some ed) of whose statements could be attributed to modern-day plutocrats in Brussels without anyone blinking an eye.(most of whom are not fascists ed)

    So the madness and suffering of relatively minor players in the EU game is of little consequence to those who dream of a united and powerful (words left out ed)Union.

  10. Posted July 13, 2015 at 6:53 am | Permalink

    Incidentally, still waiting to hear how the Labour leadership contenders (save Corbyn) reconcile their view that we should stay in the EU under all circumstances with the fact that the EU is, in their name presumably, crushing Greece with genuine austerity.

  11. Posted July 13, 2015 at 7:01 am | Permalink

    If it is always the euro to blame, why is youth unemployment in the UK (a supposedly successful economy) more than twice as high as in e.g. Germany? Shall we blame the pound sterling?
    It appears that Greece has taken the sovereign decision to stay in the euro. It also appears that Greece wants to rebuild the trust it had squandered. It even appears that 19 governments will once again reach an agreement. Do notice that if it was only Germany calling the shots, it wouldn’t take so long to reach agreement.

    Reply Glad you are happy with the results! After bringing the Greek banks to edge of bankruptcy and stopping normal trading in Greece, we now have an agreement to hold talks about a bail out! Some people are easily satisfied.

    • Posted July 13, 2015 at 8:26 am | Permalink

      Peter vL

      The youth unemployment rate across the EZ is 21.4% almost double the UK.

      • Posted July 13, 2015 at 11:53 am | Permalink

        @libertarian: UK16.9%, Germany 7.7%

        • Posted July 14, 2015 at 7:07 am | Permalink

          @PVL

          You might as well measure Berlin against London if you are not going to take the whole area into account. Disingenuous use of figures by you I feel

          • Posted July 16, 2015 at 6:53 pm | Permalink

            @Narrow Shoulders: is it wrong to compare EU members?
            If you really must you can compare the non-euro area to the euro area – which is only very slightly in favor of the non-euro area.
            If you were to keep comparing the UK only to say, Zimbabwe, in order to make yourselves feel good, be my guest. I won’t compare the Netherlands to an economy like Croatia, I would chose more comparable economies like Belgium or Denmark.

        • Posted July 14, 2015 at 3:22 pm | Permalink

          Peter vL

          You are the one who wants to live in a unified country called Europe.

          In MY part of England unemployment is 1.5% and in my town its 0.7% in UK ( my country ) unemployment is half what it is in your super country ( Europe) isolating the best bits is easy .

          • Posted July 16, 2015 at 6:57 pm | Permalink

            @libertarian: a bit shy to compare the UK to e.g. Germany?
            Well, if it makes you feel better, chose Zimbabwe instead, I really don’t mind. I don’t even think of a “unified country called Europe”. How often do I have to explain the hybrid construction of the EU???

      • Posted July 13, 2015 at 12:57 pm | Permalink

        PVL, pure vindictive behaviour to bring a sovereign nation to its needs. True to form ignore the people’s wishes. The vile EU dictatorship must be stopped. Let us hope the people revolt as it was not their wish. Better to die standing than live on your knees. Did the passive Dutch not roll over when the Germans last came knocking? But we’re only too pleased when others made a stand and help free them. Sometimes you need the backbone of friends to help, unfortunately there were none in the fanatical EU to help Greece.

        • Posted July 14, 2015 at 3:09 pm | Permalink

          As I said, “Woe to the vanquished”; if those who have defeated them choose to be vindictive rather than magnanimous then there is nothing they can do about that.

    • Posted July 13, 2015 at 8:30 am | Permalink

      Uk youth employment would be even higher if the pound hadn’t been de-valued by 30% since 2008.
      The Euro area is a ‘German racket designed to take over the whole of Europe’ – designed and built to favour countries with an export surplus.
      Greece is uncompetitive and needs a de-valued currency to get it’s youth back to work.

    • Posted July 13, 2015 at 8:30 am | Permalink

      Germany benefits from the euro in having an undervalued currency which is good for it’s exports, so the strong German economy is, in part, due to the euro. The problem is that Germany seems unwilling to share as much of that wealth as they perhaps should within a single currency so thereby offsetting the benefits they have, although we can all understand the reasons that they are reluctant to do so! This of course is clearly not the only reason that Germany does well.

      • Posted July 13, 2015 at 11:59 am | Permalink

        @CdBrux: I agree with you that Germany, the Netherlands and others should share more of their wealth, but also with “conditionality” built in. There have to be reforms which make economies more competitive and finances more sustainable.

    • Posted July 13, 2015 at 8:44 am | Permalink

      Reply to reply: It is even worse! My prime-minister had to break his election promise that no more Dutch taxpayer money would go to Greece. He confessed that this morning. That includes the money from poorer pensioners like me to some wealthier Greeks, as inequality is not just an international equation. Various democratic decisions by various parliaments, including the Greek parliament, still have to be taken. However, the anti EU forces, both within and outside the EU cannot claim victory today. No doubt they will keep trying. 🙂

      Reply No-one wins today. You however need to recognise the grave structural weaknesses in the Euro architecture.

      • Posted July 13, 2015 at 11:43 am | Permalink

        Reply to reply: Also from a pro-EU perspective I’m concerned how things are developing. I had expected more solidarity and more creativity in addressing the Greek issues. But I also see the strength with which most continental countries always stick together and find solutions and compromises for their issues. Even without Greece and without the UK, the EU would be strong. But neither Grexit nor Brexit is likely to happen. Why not get used to being with us, the other 26 countries? 🙂

        • Posted July 13, 2015 at 12:44 pm | Permalink

          Peter, what is your preference, solidarity or democracy (sometimes referred to as populism)?

        • Posted July 13, 2015 at 6:49 pm | Permalink

          Peter v L

          Heres why, because you are living in the past, imperialism is dead, it doesn’t work. If the UK wanted to be part of a massive centrally controlled block of countries we wouldn’t have given up the British Empire consisting of 141 countries and 20% of the population of Earth, if we wanted to be part of an integrated trading block we wouldn’t have let down the Commonwealth consisting of 53 countries and 2.1 billion people. We realised long ago that this ISN’T how things will be in the 21st century.

          Freedom is our call now, self determination and controlling our own country. You meanwhile can continue in slavery to your German/French masters. This treatment of Greece has finally let the cat out of the bag for all to see.

        • Posted July 13, 2015 at 9:27 pm | Permalink

          PvL, how can you expect the Greeks to accept their new role as an occupied zone of the EMU? Here’s a prediction, if this ‘agreement’ doesn’t trigger Grexit, nothing ever will.

          The idea that EU inspectors can supervise the Greek government, over-riding acts of the Greek Parliament is just naïve. Etc ed

          Of course, the timing of the Greek Debt Soap couldn’t be worse for Dear Leader David Cameron. No nation looking at the EU from the outside today could sensibly join it. If Cameron goes ahead with his campaign to press for Yes he will appear grossly irresponsible. The British electorate will not bother to distinguish between the EU, the EMU or any other acronym starting with E, they will just say No.

          The argument for Yes is already lost. Brexit is getting closer.

    • Posted July 13, 2015 at 8:47 am | Permalink

      Peter Van Leeuwen,

      Germany and Holland do reasonably well in the eurozone because both run illegal surpluses in their trading account. 8% and 11% of GDP respectively. They export their unemployment to other other eurozone countries. Their surplus in euros has, under current rules to be someone else’s deficit in euros. In other words, Holland and Germany are sucking the lifeblood (euros) out of the economies of their trading partners.

      Do people in Holland and Germany understand this? Do you understand this?

      • Posted July 13, 2015 at 12:54 pm | Permalink

        Maybe they learnt something from the British from 1967 to the current day. In a crisis always talk tough and promptly devalue your currency.

      • Posted July 14, 2015 at 5:42 am | Permalink

        @petermartin2001: Other EU countries (especially EZ countries) should pressure Germany and the Netherlands to reduce their trade surplus, e.g. by increasing consumption, which would lead to more imports and may help other EU nations’ export.

        • Posted July 14, 2015 at 12:18 pm | Permalink

          This sounds like a Dutch person saying “OK I know we have been misbehaving but its really down to ‘other EU countries (especially EZ countries’ ” to “pressure” us to stop !

          The simplest way for Germany and Holland to increase their imports is for govts to reduce the taxation burden on their own populations. Especially their less affluent members. They could also spend more on maintaining their infrastructure. They would then move from producing surpluses in money to having surpluses in real goods and services.

          German and Dutch people would be better off. Don’t you want to be better off? Why would you wish to rely on others to “pressure” you?

          • Posted July 16, 2015 at 7:03 pm | Permalink

            @petermartin2001: Actually, there are government decisions now to decrease taxes for working people, for which there is enought support in the Dutch parliament. Why only now – because our improving deficit allows for it.

    • Posted July 13, 2015 at 8:52 am | Permalink

      No, it is NEVER the euro, or the EU, which is to blame. And some of the people, traitors in my eyes, who urged us to join the euro still want us to join it.

      • Posted July 13, 2015 at 11:49 am | Permalink

        @Denis Cooper: I have all sorts of EU criticism and also about the way the euro is run . . . . with one minor difference: it is constructive criticism.
        We’re not about to give up on the EU. If you ever listen to EP debates, you’ll notice that strong EU supporters (take Guy Verhofstadt as just one example) is full of criticism.
        Why call British with a different point of view “traitors”? That would be rather telling . . . . about you!

        • Posted July 13, 2015 at 4:21 pm | Permalink

          Telling about you that you cannot recognise when people have betrayed their country; no doubt it would be different for you if they had betrayed the EU.

          • Posted July 16, 2015 at 7:06 pm | Permalink

            Many members of the Dutch parliament (a real democracy) are against the EU. Take Geert Wilders’ party with 10% of the seats. How many seats did UKIP have to represent 4 million voters? I would not call Geert Wilders’ followers traitors, that wouldn’t be very democratic.

        • Posted July 13, 2015 at 9:10 pm | Permalink

          Peter Van Leeuwen,

          I wouldn’t use the term “traitor”. If the euro was running successfully then there would be a good case for Britain joining in with rest of the EU.

          Yes there does need to be constructive criticism of but there also needs to be an understanding of why the euro is functionally deficient.

          I don’t believe most advocates of the euro understand, or want to understand, why there is a problem. They just prefer to point the finger at Greeks and others and claim it’s due to their incompetence.

          Or am I wrong? Do you understand why it isn’t working?

          • Posted July 14, 2015 at 5:37 am | Permalink

            @petermartin2001: The euro isn’t working properly because there is a lack of trust. “Eurobonds” would have helped to mutualise public debt, but then there would also have be modernisation and reform of the economies. Northern countries don’t trust that some countries will do that without significant pressure or, what is tried now, hard conditionality. Example Greece: for its bailout in 2010 is was to privatise €50 billion of state assets (often highly inefficient companies, the sort which the UK privatised decades ago). In 2015, Greece had only privatised up to €3.2 billion, an underperformance of 94%. No surprise that this results in less trust and the need for hard conditionality. I expect mutualisation of debt to return as a possible remedy.

          • Posted July 14, 2015 at 12:04 pm | Permalink

            “The euro isn’t working properly because there is a lack of trust”

            In that case you should favour breaking apart the eurozone. If two or more countries decide to share a common currency they have to trust each other. Period. As the Americans like to say.

          • Posted July 14, 2015 at 3:21 pm | Permalink

            I would have no hesitation about applying the word “traitor” to any of those leading figures who wanted us to join the euro knowing full well that it would drastically reduce the UK’s scope for independent action and potentially leave us at the mercy of foreign powers. Not only did they have a natural duty of allegiance to this country as citizens, also in many cases they had expressly taken oaths of allegiance as parliamentarians and ministers and Privy Councillors. And I only stop short of accusing them of treason because I know that technically the laws of treason did not extend to what they did, unfortunately, something which I believe should be rectified in a future law on the subject.

      • Posted July 13, 2015 at 1:17 pm | Permalink

        Dennis,

        It was interesting to note that the BBC were reporting that, written into the agreement, there are many phrases which say that if anything go wrong or anything fails, it is the fault of Greece and not the EU or EZ.

        Today will go down in history as the day democracy was ridden rough shod over, in the very place democracy was born.

        Message from the EU in effect:-
        We ARE the state, do as you’re told or we’ll have you.

    • Posted July 13, 2015 at 9:18 am | Permalink

      As long as the ‘EU project’ keeps moving forward, people like PvL don’t care about the consequences for other people.
      One day the chickens will come home to roost, even for PvL.

    • Posted July 13, 2015 at 10:24 am | Permalink

      PVL – the UK has had the highest teenage pregnancies in EU for a while. I blame the euro.

      • Posted July 13, 2015 at 11:10 am | Permalink

        I blame the Euro for all the economic migrants queueing up at Calais. Obviously you get more for your money when your given free pounds instead of free Euro’s.

        • Posted July 13, 2015 at 1:00 pm | Permalink

          Well if you believe that then you should advocate adopting the euro and, according to you, that would make the problem go away. Job done.

      • Posted July 13, 2015 at 6:55 pm | Permalink

        YulwayMartyn

        You are consistent at least, you are wrong about everything you put. Do try to keep up.

        Teenage pregnancies hit record low in England
        http://www.bbc.co.uk/news/health-31602417

        Probably due to the fact we didn’t join the Euro I would have thought

        • Posted July 14, 2015 at 1:11 pm | Permalink

          Wolfie

          I used the pluperfect tense if you care to read my original comment.

    • Posted July 13, 2015 at 10:34 am | Permalink

      “If it is always the euro to blame, why is youth unemployment in the UK (a supposedly successful economy) more than twice as high as in e.g. Germany? Shall we blame the pound sterling?”

      A question demonstrating an elementary lack of understanding; Germany has an undervalued currency, both in terms of internal EU and external trade, increasing demand for German produce beyond its natural level.

      Furthermore, UK unemployment is maintained at a relatively high level as a result of deliberately uncontrolled immigration from outside the EU in order to multiculturise us, and uncontrollable immigration from poorer parts of Europe from within the EU, meaning we can never have full employment whilst the majority of our politicians are traitors and the people are too stupid to get rid of them.

      • Posted July 13, 2015 at 12:16 pm | Permalink

        Although control of the money and labour supply are key to neo lib economics. Its a bit silly to blame an open door immigration policy on why, in Bristol for example, a thousand 16 year olds are chasing one job. Up in the North the ratio must be even worse. Germany has a worse asylum/economic migrant problem than ourselves. Go through the “der Spiegel” English language archive and see how local authorities are having to requisition flats there to house them all.

        Consider this, who is going to be of more interest to an entrepreneur, a young lad who has served his time (as is mostly the case in Germany) or somebody with a arts/soc sci degree from an institution usually of dubious quality (as is usual in the UK)? If you are looking for an alternative explanation, you also might remember Sir Keith Joseph’s Birmingham speech with regard to the comment above about the UK leading Europe in teenage pregnancies.

        • Posted July 13, 2015 at 10:00 pm | Permalink

          Don’t quite follow that: are you saying the 1000 sixteen year olds seeking work in Bristol, unsuccessfully, all have Social Science degrees or that they are all pregnant?

          • Posted July 14, 2015 at 7:18 am | Permalink

            And that none of them were born elsewhere.

            Immigration does indeed create jobs but not in a 1:1 ratio so the existing population needs to be in full employment before the floodgates are inched open.

            If the existing population lacks the skills, train them.

      • Posted July 13, 2015 at 2:10 pm | Permalink

        @forthurst: you could of course have devalued your currency a bit more than the 25% you did, and you would also have had an undervalued currency and no significant youth unemployment???? I wonder if it works that way.

        • Posted July 13, 2015 at 10:08 pm | Permalink

          PvL perhaps you are not aware that sterling is a floating currency whose rate is set by international forex markets, whereas Germany has a fixed exchange rate within the eurozone, but which itself has an external floating exchange rate based on how the eurozone performs as a whole: further economic basics for your attention.

        • Posted July 14, 2015 at 1:45 am | Permalink

          PVL,

          No it doesn’t quite work that way. The UK’s currency is overvalued in the sense that it enables the countries inhabitants to afford more imports than it covers by the sale of exports.

          That means the UK runs a surplus in the trade of goods and services. Which increases living standards.

          Relatively low unemployment, in such economies as the USA and UK requires that government deficit spend the sale of govt bonds which are bought by the central banks of the big exporters.

          That would put the UK in a impossible position with regards to euro SGP rules. Whoever wrote those rules didn’t understand international money flows.

          • Posted July 14, 2015 at 1:46 am | Permalink

            Sorry. I have to correct this! “country’s inhabitants”

          • Posted July 14, 2015 at 11:14 pm | Permalink

            the UK runs a surplus in the trade of goods and services.

            Is that correct? In May 2015 we ran a £8bn deficit in goods but a £7.6bn surplus in services.

          • Posted July 15, 2015 at 9:57 am | Permalink

            sjb,

            The current account deficit is approximately 5.5% of GDP. This is the difference between the amount of goods, services and payments the UK sends to the rest of the world and the amount coming in. In short, it is the difference between the amount of money flowing in and out of the UK.

            There is a good article by Peter Spence in the Telegraph (April 2015) which describes “Why the UK’s ‘other deficit’ has economists scared”

            I wouldn’t agree that we should be scared, but neither should we ignore it as we largely do.

            It’s economic nonsense to think in terms of reducing the govt’s budget deficit with the CAD this high. If the economy is losing 5.5% of GDP to pay for net imports then the govt has to run a deficit of 5.5% of GDP just to keep things all square in the economy.

    • Posted July 13, 2015 at 10:36 am | Permalink

      PVL I have brought up the UKs rate of youth unemployment before with JR and just like with you he dodges giving you a straight answer. Here it remains government policy for you to a acquire a degree, run up a load of debt and then more than likely end up with a job that does not require that level of education in the first place. Perhaps JR could also explain as to why we also have the highest petrol prices in Europe too? If you are coming here for a holiday make sure you get tanked up before you get on the ferry, you will be paying around 30% more when you get off.

      Reply We have high petrol prices because tax levels of fuel here are high to -ay for the NHS, education etc. The government offers people the freedom to go to university or undertake job training and to borrow on soft terms to pay for the experience, expecting people to be better judges of which degree courses/apprenticeships etc are worthwhile

      • Posted July 13, 2015 at 1:35 pm | Permalink

        I realise this is drifting away from the topic. Although I agree with the ‘expecting people to be better judges of which courses are worthwile…’ I would also say that there seems to be a strong implication from many politicians and others that pretty much any university degree is ‘worth’ more than even a good vocational learning. For 30+ years academia has been seen as superior (“you need to get yourself a degree…”).

        Some are smart enough to see this is nonsense but it would be nice to hear more often the statement that a good vocational education can be just as good and often more useful.

      • Posted July 13, 2015 at 3:34 pm | Permalink

        DRW, remember that unemployment is an inflation control tool for a neo-liberal government, along with importing labour from low-wage areas, to suppress wage-push inflation.

        Countries like Germany and Netherlands, with high trade surpluses, need to suppress purchasing power in their domestic economies. Say you have 10 people in your street and they make between them, 10 washing machines. In simple terms, say, there is one machine for each of them to buy at a certain price. life is sweet and the clothes get cleaned.

        Now say, you are exporting like crazy, miles out of balance with your imports. Now you have 10 people with wages in their hands wanting to buy a washing machine, but there are only 7 left to buy in your shops, because you exported 3 of them to foreigners to enjoy in exchange for the foreigners currency. Washing machines suddenly become expensive, too much money chasing too few goods. Washing machine factory already working flat out.

        I know says government! Raise taxes and create some unemployment, that will reduce aggregate spending power and keep inflation down. Even better, import some cheap labour, guys who know how to make washing machines and will do it for half the wages.

        The junior government clerk says, what are we doing with all that foreign currency we have got in Foreign Land’s central bank, from selling them washing machines? Government replies, we are building a washing machine factory in Foreign Land. We can build them cheaper there and it’s nearer the customers, saves transport. 😉

    • Posted July 13, 2015 at 11:04 am | Permalink

      Youth unemployment in England is high due to unfettered migration from Eastern Europe taking the jobs the indigenous youth once did!

      • Posted July 13, 2015 at 11:36 am | Permalink

        Thanks for writing that for me TA!! (and DRW’s reply to YWM above).

        If PvL has any doubts about that, he can have a chat with my 19Y.O. daughter and her friends, who can’t get the ”traditional” school leaver/student jobs because they’re all taken by EU and non-EU migrants.

        • Posted July 13, 2015 at 2:13 pm | Permalink

          @DaveM: looking for easy scapegoats . . .
          You need immigrants to keep your economy healthy.

          • Posted July 13, 2015 at 10:27 pm | Permalink

            What is ‘healthy’ about an economy that pays people to sit at home and languish on the scrapheap as it is easier to import and subsidise low skill/low paid migrant workers using the benefit system ?.
            It’s also not ‘healthy’ for a transport/healthcare/education/social housing system having to cope with many more people than they were designed to accommodate.

          • Posted July 14, 2015 at 8:09 am | Permalink

            Nope, it’s a statement of fact. Agreed, we need SOME immigrants to help the economy.

            But, jobs we used to do (just a couple of examples):

            Summer farm work – .
            Building site labouring – .
            Washing cars – .
            Waitressing – .
            Cleaning – for an escape from the dictatorship that you love so much. If you got out and about a bit you’d see the same thing happening in your country.

            I have a job, Peter. I have a pension and a future. I worry about my kids and grandkids though. This is the problem with the EU though, isn’t it? It’s only liked by selfish money-grabbers with no sense of identity, nationality, or pride, and no concern for future generations.

          • Posted July 14, 2015 at 12:32 pm | Permalink

            Peter van Leeuwen,

            You’re absolutely right that British people will look to scapegoat overseas workers. It has always happened and I suppose it always will. Whenever people cannot find jobs they’ll blame immigrants for taking jobs that they consider should rightfully be theirs.

            I could try to explain to those unemployed workers that unemployment isn’t due to immigration but rather it is due to neoliberal policies applied by government. Their lack of willingness to deficit spend for example!

            It’s not easy! Especially when the ordoliberals who run your country and Germany hate the idea of deficit spending as a cure for high levels of unemployment.

      • Posted July 13, 2015 at 1:03 pm | Permalink

        Yes because they have been shafted by various UK governments that have variously claimed to have both educated and prepared them for the workplace. They have done neither.

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

    Democracy on the one side and the euro and the EU on the other cannot coexist. In the end I believe democracy will be the loser as the europhile’s and Brussels technocrats(commissars) hubris, self interest and narrow mindedness will refuse to allow the right decisions to be made.

    The EU has turned into yet another exclusive club for the members states senior and favoured politicians where egos can shine and highly profitable sinecures can be secured.

    We are going to continue with what we we do not need and is doing more damage than good for most Europeans because the EU and euro will be retained by those who only really benefit from it, Europe’s top politicians and bureaucrats.

  13. Posted July 13, 2015 at 7:23 am | Permalink

    BBC Headline @ 8:19

    Greece debt crisis: Eurozone summit ‘reaches agreement’

    I guess they have agreed who is going to kick the can….

  14. Posted July 13, 2015 at 7:26 am | Permalink

    Short answer. NO. The project must continue
    Europe is for the elite, the sheeple are there as tax cows. Still CMD wants to be part of this Nirvana.

  15. Posted July 13, 2015 at 7:28 am | Permalink

    Yes it is quite correct of you to pose all these questions. even though we have dissected them Ad Nauseum for the past year or more. You have had our response to these rhetorical questions.

    The real question, which you have to date avoided, remains unanswered. Why in the face of such evidence does your leader persist on a path that would bind the UK further into this multi vehicle crash. If Mystic Meg has advised him to await the tectonic plate upheaval within the EU because by 2017 they will be begging at his door for advice, I have the strongest doubts. The disintegration of Europe will run for at least another ten years before sense prevails.

    Why do two thirds of the H o C conservative party support this insanity. Is it because half of them have gopher to ministerial jobs and the other half aspire to such. What is it that Cameron has been promised by the EU, our banks, or big business that persuades him to keep the UK on this path to purgatory.

    Just remember that your party are in government because:-
    1.
    The last minute fear on the part of the electorate of a labour/SNP arrival in power.
    2.
    An electoral system that is corrupt. Check out the numbers of votes gained by the SNP, Lib/Dems, and UKIP then try to relate them to their representation in the H o C and tell me that this is fair.

    It is long overdue that you, the thinking element in the conservative party, stopped pedalling the blatant dishonesty of this so called re-negotiation and started to openly damn it for what it is. Where is the Farage eloquence in the conservative party, we need to hear it.

    Reply I backed a leader and party that offered us the only chance of an In/Out referendum – why not help us win it for Out or for a new relationship that gets us out of all these entrapments? Your endless criticism is tedious, when we have made a big advance with the referendum.

    • Posted July 13, 2015 at 8:58 am | Permalink

      Getting the referendum is one thing, but winning it against all the forces which will be arrayed against us is quite another thing. B

      By “us” I mean those who want to leave the EU, who can sign up here:

      http://www.betteroffout.net/

      to support the Better Off Out campaign which will start in September.

    • Posted July 13, 2015 at 9:20 am | Permalink

      Reply to reply,
      Why do you never advocate leaving the EU but always talk of “a new relationship”?

      Reply Because I am a realist who wants the UK to trade with the EU and be friends with them, but does not wish to be under the control of the current Treaties.If you do not want any kind of relationship with the EU then you will help lose the referendum.

      • Posted July 13, 2015 at 11:32 am | Permalink

        Reply Because I am a realist who wants the UK to trade with the EU and be friends with them, but does not wish to be under the control of the current Treaties.If you do not want any kind of relationship with the EU then you will help lose the referendum.

        The whole point of the Eu is ‘ever closer union’. Take that away and it’s nothing!. For me we cannot ever contemplate staying in, under any terms when the commission is happy to wreck an economy to keep their ideology alive.

        I thought the whole point is we can jettison the ‘baggage’ of EU membership (the costs, stifling rules and loss of sovereignty) and enter a trade only relationship. That is in effect leaving the European union and maintaining friendly/trading relations as the Swiss manage so well.

        Dr Redwood’s views are coloured by his need to maintain a semblance of loyalty to his party but on this issue a great deal of imaginative thought is needed to reconcile the problems with this position!

        • Posted July 13, 2015 at 9:46 pm | Permalink

          @Ken Moore: You might want to start thinking more creatively, and also make a better distinction between the intergovernmental and supranational aspects. Taking out “ever closer union” for British continued membership should b e quite feasible, as long as you don’t demand scrapping it for all the other nations (why should you anyway). The in between or “à la carte” relationship, provided it is fair to all sides, is the best a eurosceptic can hope for IMHO. It might be a kind of EFTA-plus or EEA-plus relationship, or (what I would prefer) a full-fledged membership with one or two more opt-outs.
          Of course you can opt for a completely “out” WTO kind of relationship, but just realise how much geopolitical pressure was exerted to keep Greece (less than 0.6 of the world economy) in the euro and the EU.
          You of course may think that the USA, the City, and the other big bear (UK big business) will duly respect the UK’s sovereign right to make its own choice. Yes, they will, in front of the camera. But lobbying and influencing ald elbow twisting doesn’t usually take place in front of the camera.

      • Posted July 13, 2015 at 11:48 am | Permalink

        Reply to Reply

        Then start pushing for EFTA/EEA with a caveat on immigration, which seems to sum up what you want and what I want.

        • Posted July 14, 2015 at 9:47 am | Permalink

          Agree with this, it embodies the relationship the electorate thought they were getting in the first referendum and suits us now. It also has the important benefit of access to existing FTAs with other countries that would otherwise have to be negotiated from scratch if we simply relied on WTO rules.

      • Posted July 13, 2015 at 2:18 pm | Permalink

        Reply to reply,
        Why is leaving EU incompatible with being friends with them,trading with them but governing ourselves?

    • Posted July 13, 2015 at 11:19 am | Permalink

      “What is it that Cameron has been promised by the EU” – -quite simple – a place at the top table for pouring our money down the drain and (inviting in many migrants that ed) love the housing, cash, healthcare etc that comes free, with a card saying “all courtesy of the taxpayer”, for everyone that gets here. He is willing to sell/destroy a whole nation, just to satisfy HIS ego. I hope what eventually awaits him will be just rewards for his treachery.

    • Posted July 13, 2015 at 11:41 am | Permalink

      JR – those of us who voted Tory likewise supported a party that offered a Referendum (although Ms Harman is starting to look more Conservative than your party leader at the minute, and probably would have offered one too).

      But that does not answer Agricola’s:

      “The real question……remains unanswered. Why in the face of such evidence does your leader persist on a path that would bind the UK further into this multi vehicle crash?”

      Why will NO-ONE answer that question?

      • Posted July 13, 2015 at 3:01 pm | Permalink

        Because the Mr Cameron is part of a privileged elite that utterly despises anything that isn’t ‘modern Britain’.
        The Europhiles have been proven to be wrong about every major decision for the last 40 years but aren’t about to admit this.

    • Posted July 13, 2015 at 12:11 pm | Permalink

      Reply to Reply.

      You might find it tedious, so lets have the answers. Why are you pushing the Cameron line of re-negotiation when it has been demonstrated to be a fantasy. He could not even get them to spare the time to discuss it. Come to terms with reality. We only got the referendum because of a fear of UKIP, not due to the generosity of Cameron who likes the status quo., stay in come what may. He hasn’t had the guts to stand up and explain why he wants us in. The tedium will reduce when we start seeing and hearing the shredding of the EU in the H o C as we do from time to time c/o Nigel in the European parliament. With a majority of twelve and about a hundred conservative MPs who do not like the direction we are being taken, you have power. Start using it.

    • Posted July 13, 2015 at 5:09 pm | Permalink

      Reply to Reply.
      I too voted for the same party, not because I felt assured of a referendum, your leader has a credibility gap, but because I respected the integrity of my MP. The only way I can help you win it is by voting for our departure from the EU. Should the country vote for out, comes the tricky bit. What sort of a relationship will your Europhile leader try to sign us up to. Things could get really nasty if your leader is still not listening. You will have to live with criticism if the questions do not get answered. The agreement to a referendum is not an end in itself. There is the wording of the referendum, who is allowed to vote, control of the bias that will come out of the BBC, funding to the BBC, CBI, et al from the EU, and whether the EU are allowed in any way to take part, equality of funding between the in and out camps. Never mind what your leader is asking for and may or may not get. When we could have what I think we both want via EFTA/EEA and a tweak to immigration, and current members of same would welcome us, what is all this re-negotiation really about. You will have to put up with me taking a Caveat Emptor approach, or not as suits you.

  16. Posted July 13, 2015 at 7:30 am | Permalink

    These are all good points and we see that democracy has become meaningless in the supplicant Southern European States, especially Greece. Mind you that’s true of any insolvent state – the UK in 1976 had its economic policy dictated by the IMF over the heads of the socialists in the Labour cabinet, as the UK could not borrow in the markets.

    There is some wishful misunderstanding on the eurosceptic right in the UK. Mr. tsipras is now being hailed by some – Peter Hitchens is a new example – as a righteous leader of a people struggling for freedom. He is no such thing. He is arguing for Greece to remain in the eurozone, in spite of all the evidence of the damage its dome to his country. Of course he is also a far leftist, but he would like the EZ to pay for his leftism. An honest and rational Greek politician would be arguing for exit from the euro, economic independence and reforms and restructuring in the Greek economy to make it competitive again. But there don’t seem to be such politicians and the majority in Greece don’t support that. Unfortunately they seem to be a nation in denial and will now sullenly have to submit to rule by the eurozone jackboot. It is a modern tragedy.

  17. Posted July 13, 2015 at 7:37 am | Permalink

    I agree with all of that John.

    I don’t like typing it but it’s academic. All the signs are that the Greek electorate are wholly supportive of retaining membership of the Eurozone. If that’s a future underpinned by their own electoral endorsement, then that’s the future they’ll have.

    However, on the basis that it’s recent news that the crisis in Greece overwhelmed in the headlines, there’s another little matter on which I found the reaction of the UK Government to be legendarily underwhelming. You yourself will remember with some anger the matter of the blockading of Lorries at French border crossings twenty years ago, which led directly to many dozens of drivers going out of business, a matter which took years of subsequent work for compensation.

    Yet again, one of those same border crossings has been closed – twice – (while the Mayor of Calais joyfully marches arm-in-arm with the strikers) and British business is harmed. I’d say the situation demanded a reaction a paradigm shift more strident than ‘this is totally unacceptable’. I would hope one of the lessons your colleague Stephen Norris learned two decades ago would be that any losses incurred by businesses would be followed up using fast-track compensation procedures at the very least? I would also hope that strategic plans are in place to take on these obstructions and militant activities in the Courts, where the French Government lacks the competence and courage to do so properly themselves, and has done across the past four decades?

    • Posted July 13, 2015 at 9:00 am | Permalink

      All the signs are that the Greek electorate are wholly supportive of retaining membership of the Eurozone.

      I am puzzled by how often I hear this claim being made.

      Have the electorate ever had the options explained to them or has the question every been put to them in a referendum? Perhaps we are we relying on political polling – the same political polling that went spectacularly wrong at the last referendum.

      Or perhaps it is the old belief that if you repeat something often enough, the electorate will come to believe it.

      Reply They were told by the Eurozone that their recent referendum was vote on whether to stay in.

      • Posted July 13, 2015 at 1:06 pm | Permalink

        Reply to Reply: And how was a “NO” vote to be interpreted under thiose circumstances? As a sign that the Greek electorate are wholly supportive of retaining membership of the Eurozone? Some people read into a referendum result only what they WANT to read into it.

    • Posted July 13, 2015 at 9:21 am | Permalink

      ‘while the Mayor of Calais joyfully marches arm-in-arm with the strikers’.

      One always felt it was a mistake to let Calais go on a permanent basis. There have been so many opportunities to put the matter right, all of them missed.

  18. Posted July 13, 2015 at 7:49 am | Permalink

    Democracy is anathema to the EU.
    We must leave regardless of any so-called ‘re-negotiations’.
    Who, other than your leader and others committed to government by the EU, would believe any of it?

    • Posted July 13, 2015 at 7:53 am | Permalink

      We really have got to stop assuming that everyone is English!

  19. Posted July 13, 2015 at 7:49 am | Permalink

    An unbelievable farce.

    Why do these idiots believe that this bailout will be any more successful than the last ones, given the enduring hatred the Greeks will now have for their dictators in Brussels and Berlin.

    Will the Greek parliament now do its duty and throw the agreement out?

    What is being done to Greece is vile and evil and it is only a matter of time before other countries share the same fate.

    • Posted July 13, 2015 at 9:18 am | Permalink

      No, the Greeks, both the people in general and their elected politicians, are in the grip of the Stockholm Syndrome, or possibly the Oslo Syndrome.

      On TV a Greek chap told the reporter than returning to the drachma would be a “disaster”, almost as if there was not already a disaster all around him .

      Many people in the smaller European countries, especially those with traumatic histories, seem to be terrified of the prospect of exclusion and don’t actually want their countries to be independent sovereign states if that means that their representatives would no longer be able to attend the European meetings and be embraced by the representatives of more powerful countries, especially of course Germany. That is a situation which the Heath government helped to create when it decided to add our weight to that of the Six in the EEC rather than continuing to take a leading role in the alternative EFTA system, the Seven.

  20. Posted July 13, 2015 at 7:52 am | Permalink

    “How can you run a currency and a banking system when the authorities are so visibly unable to deliver what they promise?”

    You can’t.
    That is exactly why the European Commissioners and 100 MEPs have written the Spinelli Document. Nobody even seems to have heard if it! They propose a Constitutional Congress to meet on 1st June 2015 and which will produce a Constitutional Document in 2017, which will be delivered in 2025.
    Then the Commission will have its own courts, its own police, its own army and its own bank. Money and capital will be moved freely round the Union by the Commission as planned. The Union will have been realised.
    If things get nasty, there will be a lot of force available to the President of the Commission…

    Reply I wrote about it here!

  21. Posted July 13, 2015 at 7:59 am | Permalink

    Mr Redwood do you know something we don’t?

    The media would have it that there is an agreement, preposterous and incredible though that sounds, particularly as the proposal I saw was that The Greek Banks will be recapitalised with the proceeds from a 50 billion sequestered privatisation portfolio.

    The Banks need recapitalising NOW, this instant; they cannot wait. Who is going to give them 30 billion tomorrow; which Parliament will pass that one?

    After eighteen hours of talks without sleep, we don’t have an agreement, we have predictable collective insanity; and OUR Parliament has put THESE people in charge of our destiny!

  22. Posted July 13, 2015 at 8:02 am | Permalink

    http://www.reuters.com/article/2015/07/13/us-eurozone-greece-idUSKBN0P40EO20150713

    “One diplomat said that was tantamount to turning Greece into a “German protectorate””

    Funny, that’s just what I recently said would be the simplest solution.

  23. Posted July 13, 2015 at 8:04 am | Permalink

    08.30 hours as I write. A brief three-man press conference, just finished, headed by Mr Juncker, failed to answer a direct question from a Czech journalist asking whether the “Agreement ” was not in complete disagreement with the position of the Syriza party and the Greek electorate. The next question from another journalist asked whether it was true that the “Agreement” amounted to “a coup ” ( meaning a coup d’état ) by the EU on the Greek nation. The question was not addressed at all. It appears there will be no debt write-down.

    The EU hopes the “Agreement” will be ratified by the Greek parliament by Wednesday.

    Whatever technical victory has been achieved by the EU over Greece and whatever the immediate acquiescence of the Greek parliament and in particular its people there does not seem to be any medium to long-term solution.

    If I were the Greek Communist Party Leader, I would be with my Party members arm in arm in characteristic long lines of Greek dancing, blasting out music from loudspeakers, dancing through the streets of Athens knowing a hammer and sickle had just been stabbed deep deep deep into Greek hearts.
    The cohesion of Europe , historically, should not be left to the wisdom of a German Chancellor.

    • Posted July 13, 2015 at 11:51 am | Permalink

      There WILL be a debt write-down. Just not yet. That’s all.

  24. Posted July 13, 2015 at 8:07 am | Permalink

    The EU is a political project to create a United States of Europe. They don’t care how many lives are wrecked in order to create it.

    With Greece, they now have their first completely captive nation. The EU is effectively governing Greece – dictating the fiscal policy which will apply and how they will achieve it.

    Greek democracy is dead. The Greek puppet-government serves and reports to the EU, not the people. Any future Greek puppet-government will serve and report to the EU, not the people.

    The EU is seeking to achieve with fiscal control what Napoleon and Hitler failed to achieve with guns: a European Empire.

    We should get out while we still can.

  25. Posted July 13, 2015 at 8:08 am | Permalink

    Why do the BBC keep telling lies about “the market”, the Euro is dropping this morning on this news, not going up. It never went up 1% as they reported. The Euro is collapsing and I am shorting it now and making money.

    Let us see if the media tell the truth (the Euro is collapsing on this news), because this is about a political project not an economic one.

  26. Posted July 13, 2015 at 8:11 am | Permalink

    It is a warning what the EU does do to democracies. The Greeks are on the extreme end of being a puppet Government , but don’t anybody be fooled into think that we aren’t. We are , we are just further back on the proverbial EU train, which has all European countries heading in the Greek’s direction.

  27. Posted July 13, 2015 at 8:21 am | Permalink

    Meanwhile Mr Cameron continues with his ‘useless and meaningless’ re-negotiation strategy. He could have used the Greek tragedy to press for serious reform but we all know he doesn’t want that.

  28. Posted July 13, 2015 at 8:23 am | Permalink

    So unanimous agreement in Euroland, and the leaders are patting each other’s backs. Greece gets a further 35Bn Euros, but at what cost? Loads of privatisation, which would be good if Greece was in a strong and stable situations. Complete reform of pensions.again good if Greece was stable. But Greece is not in a stable situations, Furthermore, every individual government of Euroland countries have to agree. Now we see Euroland being kept together but at all costs, yes ALL COSTS.
    .

  29. Posted July 13, 2015 at 8:24 am | Permalink

    The Greek Banks will be recapitalised with the proceeds from a 50 billion sequestered privatisation portfolio.

    >
    How does that work if the Greek banks get recapitalized and privatized at the same time? Doesn’t someone get free money?

  30. Posted July 13, 2015 at 8:31 am | Permalink

    I think the end game is in sight and will consist of Greek physical assets to the tune of 50 billion euros being moved into some form of escrow arrangement, managed by the EU and flogged off as quickly as possible.
    At the same time the EU technocrats will be moved quietly into position such that they will run Greece through the elected government who will have to do as they are told. It won’t be the first time a figurehead government was imposed on a country as done on so many previous occasions. Don’t mention the war!

  31. Posted July 13, 2015 at 8:41 am | Permalink

    There is almost no limit to the price people in the grip of a political fanaticism, as the EU is, are prepared for others to pay in pursuing their cause. We saw this over and over again in 20th century Europe. Lessons are never learned as one cause disintegrates they come up with another idealistic untried scheme to tell people how to live their lives. Seeing all those politicians and bureacrats assembling in Brussels you could see how little they cared for the Greek people and how much they cared for their own self importance.

  32. Posted July 13, 2015 at 8:48 am | Permalink

    Breaking news now is that Greece will NOT leave the Eurozone, says Juncker !!! How predictable. Ruin their project ? No way.

  33. Posted July 13, 2015 at 8:51 am | Permalink

    We have taken away the Germans armies yet they still find a way to wreak havoc and mess with security across Europe.

    The reality – yet to materialise – is a North South split. Last time the Germans created an East West split for 50 years that almost lead to global nuclear destruction.

    My father flew in the Berlin airlift. The ungrateful, destructive Germans are at it again. This time with their banks rather than their tanks.

  34. Posted July 13, 2015 at 9:09 am | Permalink

    Although everyone says an agreement has been reached, my understanding is that it still has to be approved by the Greek parliament. Furthermore the agreement states that many of the demanded changes are legislated into law by that parliament before the other EZ governments and parliaments decide whether to approve it – the lack of trust issue. No doubt we will be presented with the spectacle of immense pressure being applied to the doubters in Germany, Finland and other eastern members of the EZ to approve it. Quite why they should have much, if any, faith in the stability of the Greek political system to deliver this time escapes me; the chances of it all going wrong again, and again, are very, very high.

  35. Posted July 13, 2015 at 9:17 am | Permalink

    Hmm, John, as ever you point out truths which many do not wish to hear. It’s a bit like belief in Global Warming, the EU is a religion now – sacrosanct, unaffected by truths.

  36. Posted July 13, 2015 at 9:28 am | Permalink

    Dr JR, it is clear that only the fear of German unemployment reaching 25% will cause a change of policy in Berlin. So what might trigger that fear? In the first instance, Germany’s important trade with China seems like to wither if the collapse of the Chinese equity markets is an accurate leading indicator of economic trends there. Secondly the continuing drama with Greece may be adding to systemic risk in the EMU banking system by the hour. Even if the EMU achieves a binding agreement tonight, the Greek banks and possibly their counter-parties will have been stressed to the limit.

    Reply I do not think the Chinese sharp correction in shares does mean a Chinese slump in the economy. Chinese domestic shares are still massively up on a year ago anyway.

    • Posted July 14, 2015 at 9:17 am | Permalink

      Reply to Reply

      But look at the commodities year on year performances, Dr JR. All down except wheat and corn. Hardly indicative of economic growth in the emerging markets like China and India.

  37. Posted July 13, 2015 at 9:39 am | Permalink

    What I cannot understand is if people like me knew they cooked the books when they allowed Greece in (I am not expert on financial matters), yet I knew this was inevitable, surely the political elite did as well? As far as I can tell the winners here will be the international investment class who get Greek public assets (50 billion worth) at knock down prices? It is almost like their is this symbiotic relationship between the political elites utopian political project and the international investment class who piggy back on their idealism and destructive ideas? Are they all Fabians?

    • Posted July 13, 2015 at 4:29 pm | Permalink

      They knew, but the euro is above all a political/geopolitical/geostrategic project with the economics coming a poor second as a priority.

  38. Posted July 13, 2015 at 9:52 am | Permalink

    Hi John,

    As ever, your comments are ‘spot on’.

    The EU project is an utter farce. Lending money to Greece is madness. Of course, it’s just an extension of the madness of flooding the world with the artificial money of QE.

    Even worse is the total disregard for democracy. The europrats loathe the idea of letting the ‘little people’ – those who pay their salaries and assume the debts they impose – express a view. Referendums are an anathema because they discover that voters can see through their arrogance.

    I hope that DC can renegotiate the UK’s terms of engagement with this morally and financially bankrupt club, but I have my doubts.

    Keep up the good work.

    James

  39. Posted July 13, 2015 at 9:57 am | Permalink

    It is not just Greece that is bankrupt.

    The EU and the Euro are two sides of the same coin, a coin that is itself bankrupt of ideas. How can even the most enthusiastic Europhile watching this unedifying spectacle still think that the EU has a safe, harmonious and peaceful future ?

    While there is a huge amount of blame attached to the country for its failure to reform over many years, watching Finland and Germany twist the knife in the corpse that is Greece is pitiful. In similar circumstances I have no doubt that the people of Britain would have the dignity to refuse to go along with the demands and withdraw from the Euro.

    Events of this weekend have shown very clearly what many of us here have long suspected – that there is no appetite amongst the countries in the Eurozone for the pooling of Sovereignty and massive fiscal transfers that are absolutely essential for the Euro to succeed.

    This weekend will be seen by historians as the turning point in this calamitous project.
    By their actions – or inaction – Eurozone politicians have over the course of one weekend demonstrated beyond a reasonable doubt that the Euro project is ultimately doomed.

  40. Posted July 13, 2015 at 10:02 am | Permalink

    This farce has brought some moderate left wingers into the OUT camp. This means that the BBC and its allies will start to take the OUT arguments much more seriously

  41. Posted July 13, 2015 at 10:23 am | Permalink

    I read in the Guardian that Greek business men were transferring their funds to German banks as obviously the Greek banks are not functioning properly.

    • Posted July 13, 2015 at 11:26 am | Permalink

      The Greek banks are only not functioning properly because the ECB has withdrawn support to the Bank of Greece. Why are residents of Greece penalised because of a political dispute between their Govt and the EU? Would residents of Wales ever be directly penalised in the event of a political dispute between the devolved Welsh assembly and the Westminster government?

      Of course not. That would be an appalling misuse of Government power. The Bank of England would , I hope, refuse to become politicised to that extent.

      Everyone in the Eurozone should keep the bulk of their money in German or Dutch banks. This isn’t doing the Germans or Dutch any favours. It’s simply the only way of forcing them to accept unconditional liability for their so-called common currency.

      It’s outrageous that holders of that currency are discriminated against simply on the basis of their home address.

  42. Posted July 13, 2015 at 10:27 am | Permalink

    So………………the answer to crippling debt, is yet more debt. Only in the world of the lunatic could such a thing make sense!

    What message is that sending to maxed-out credit card holders who are now seeking help?

    Tad

  43. Posted July 13, 2015 at 10:37 am | Permalink

    Can we get Farage off the TV and hear John Redwoods views instead?

    • Posted July 13, 2015 at 9:11 pm | Permalink

      We need both John Redwood and Farage on our tv screens they are both gifted and powerful public speakers – together they can reach a wider audience than either can alone.

      JR and Farage heading the Better of out campaign would help unite the splits in the Con/Ukip camp and give the best chance of victory.

  44. Posted July 13, 2015 at 10:48 am | Permalink

    I know the Greeks are suffering.

    I know the Germans don’t want to pay, and neither does anyone else.

    I know it will affect all sorts of economies.

    But I really don’t care any more.

  45. Posted July 13, 2015 at 10:52 am | Permalink

    “So they lied again” – the whole EU is a pack of lies. No wonder Mr Cameron likes it so much. It is what he is known for.

  46. Posted July 13, 2015 at 10:53 am | Permalink

    I owe Dennis Cooper an apology for not taking seriously his proposal yesterday to suspend the Greek constitution and install a German governor general. It turns out that he was very much in line with the real German position. The only difference is that things will get slightly dressed up to disguise the stark reality.

    • Posted July 13, 2015 at 4:25 pm | Permalink

      🙂

  47. Posted July 13, 2015 at 10:58 am | Permalink

    Everything you say is right but it still goes on so your views presumably are not those of the majority, assuming of course that the majority are right. Perhaps it is collective fear of the unknown that supports this mad situation. That way will lead to disaster.Putting off the evil day just makes the evil greater. I hope the Greek parliament rejects the proposals.

  48. Posted July 13, 2015 at 11:01 am | Permalink

    John, you are absolutely correct here once again – the Greeks faced a referendum, the EU politicians threatened them that a ‘no’ vote was a vote to leave (not what the paper said and not what their PM said). When the ‘no’ vote came in with a large majority, the EU refused to let them go, shut down money supply and blackmailed them, kicking the can down the road for another 3 months. The only way that this can be resolved is for Greece to introduce the Drachma as a parallel currency before the next situation arises.

    • Posted July 13, 2015 at 9:29 pm | Permalink

      Please, please can we come up with an alternative to the cliche of “kicking the can down the road” !

  49. Posted July 13, 2015 at 11:09 am | Permalink

    I don’t think we in Britain can afford to gloat too much over Greece’s debt problems. Britain’s debt is 900% (yes, nine hundred percent) of our GDP. That is nearly the same as the Weimer Republic when inflation hit something like 1000% if not more needing wheelbarrows of cash to buy just a loaf of bread. We are living on a precipice and none of our politicians has the guts to do the right thing and rein in their spending or tell us the truth as to why they need to do some painful things. It is so irresponsible.

    Reply Pay as you go pension schemes are matched by future tax revenues. The UK has taken the precaution of buying in £375 billion of its official £1500 billion bond debts. The UK state is both solvent and piqued, with its own currency to meet sterling obligations.

    • Posted July 13, 2015 at 11:38 am | Permalink

      Britain’s public debt is 82.5% of annual GDP. You might like to Google that if you’ve any doubts.

      At the time of the Weimar republic Britain’s public debt was around 170% of GDP. Were there the same kinds of economic problems? Well no, there weren’t. The problems were real but different.

      • Posted July 13, 2015 at 1:44 pm | Permalink

        There is always a debate about how much debt UK has, as John implies you can approximately double the headline figure if you factor in publis sector pensions and PFI/PPP initiatives – these raise the figure to about roughly 160% GDP. If you look at all the debt in UK, public, household, private sector it comes to 500% GDP so the 900% figure quoted above is wrong.

        • Posted July 14, 2015 at 12:47 pm | Permalink

          Roy,

          I’m not saying that debt doesn’t cause a problem in the economy. It can. But we need to understand why it is a problem. For every borrower there is a lender. For every liability there is an asset.

          If government takes on too many financial liabilities, it can create too many financial assets in the non-government sector which can lead to high inflation.

          So it doesn’t make any sense to simply add up all the debts that everyone has and express them as a percentage of GDP. If everyone had to lend someone else a sum of money then total debts in the economy would increase. Assuming that no-one defaulted on their debts the total assets , of holding the debt, would equal the total liabilities of having those debts.

          So nothing much would change. So debts or liabilities, and assets created by those debts, don’t necessarily have to be any problem at all.

    • Posted July 13, 2015 at 12:28 pm | Permalink

      JR you have got to be joking! All Osborne has managed to do is mildly reduce the rate of deficit spending not eliminate it. You seem to have forgotten our current account deficit. For how much longer are foreigners going to indulge us to the tune of £100 billion p.a.?

      For your readers who are getting on a bit and are living on a pension. I would ask them to google up the IMFs report from last week on the effects of ZIRP and the solvency of insurance companies and pension funds. JP Morgan came to similar conclusions a couple of weeks earlier. I would forget about booking that next cruise, there is a high chance that you will enjoying a Greek style retirement quite soon.

    • Posted July 13, 2015 at 5:35 pm | Permalink

      Dr Redwood,
      I find little comfort from the fact that the government has been busily buying up it’s own debt. The authorities previously poured newly-created money into the capital markets with the specific aim of increasing capital values and thus depressing yields. To the extent that this has kept sovereign debt serviceable, it has worked – but, in the medium- and longer-term, the medicine is likely to be worse than the disease.

      It’s part of George Osborne’s lala land of extend and pretend until someone else is lined up to carry the can…

      We have many self inflicted home grown problems – a seriously bloated housing market (ramped up by our zero interest rate policy) and sky high consumer debt. Gone are the days when we saw a nice house or car and thought that person is doing well. More often now that person is up to their eyes in debt.
      Then we have the bare faced cheek to accuse the Greeks of being ‘feckless’.

      When the next crash comes housing and other over-inflated assets are going to be a millstone around our necks. And what are we going to do then – interest rates have already been nailed to the floor.

      Our current account deficit of close to 6% of GDP, and a consequent need to borrow £100bn annually (and rising) from abroad isn’t sustainable. ..

      Public debt keeps rising – albeit at a gradually decelerating rate as the government hose money at it’ beloved unreformed NHS. The railways are a complete shambles….

      Oh and the Chinese have become massively indebted within the last few years – representing a vastly larger debt than the subprime debts that triggered the 2008 banking crash. The sun isn’t anymore and the roof hasn’t been fixed..just a series of panic stricken short term bodges have been made.

      • Posted July 14, 2015 at 1:32 pm | Permalink

        “I find little comfort from the fact that the government has been busily buying up it’s own debt.”

        That’s at least one thing we agree on! I’d like to be able to buy up my own debt, too!

        Can anyone explain how I go about that? 🙂

    • Posted July 15, 2015 at 8:57 am | Permalink

      Reply to Reply – thank you, but buying our own debt with borrowed money just does not calm my worries. I do not think that is sensible and it is just “kicking the can down the road” for future generations. Really responsible !

  50. Posted July 13, 2015 at 11:55 am | Permalink

    The reason they bailed out Greece again was because they could. What will finish the EU is a similar situation arising in Italy or Spain and/or German voters turning Eurosceptic. It will take a few years but it will come.

  51. Posted July 13, 2015 at 1:15 pm | Permalink

    Well the Greeks have got their Eu.86 Billion from the ECB and IMF I assume. This is not I would suggest an accolade for Greek financial management, more like euro cement for the cracks appearing in the Eurozone.

    The Euro is the means by which the EU can exert political control of those countries using it and thereby create their United States of Europe without the political agreement of the populations of those states.

    Keep a close watch on the UK’s contributions to the IMF as their money tree will require further pollination.

    As to your damage question, I would suggest that we have only seen the start of it. Although the populations of Southern Europe are stirring politically and may cause further problems for those in Brussels, the real weak link is the population of Germany. How long will they wish to keep paying for this misbegotten experiment. If pointing this out is considered tedious, so be it.

  52. Posted July 13, 2015 at 1:33 pm | Permalink

    We can now clearly see the nature of the EU and understand Europe’s future.

    A Europe dominated by Germany and held together by force.

    Where have we seen that before?

    Do the German people want that future?

    Did anyone ask them?

  53. Posted July 13, 2015 at 2:43 pm | Permalink

    Looks like we’re going to have a hell of a fight on our hands to get out of the EU but fight I will, my grandparents didn’t die just to be told by some foringneer what I can and not do, I won’t lay on my back and have my tummy rubbed , I am British and proud and want my country back and run by our elected government END OF

  54. Posted July 13, 2015 at 2:59 pm | Permalink
  55. Posted July 13, 2015 at 3:28 pm | Permalink

    The uncomfortable and painful truth is that by means of its huge trade surplus, Germany is acting as a parasite feeding on the rest of the EU.

    One way or another, that has to be addressed for the EU to survive.

  56. Posted July 13, 2015 at 5:58 pm | Permalink

    This is getting interesting. According to the FT the Commission is proposing to use the EFSF to fund the bridging finance needed. That’s partly our money and would breach a 2010 agreement secured by Mr. Cameron.

    http://www.ft.com/cms/s/0/0c789340-296a-11e5-acfb-cbd2e1c81cca.html#axzz3fmhBPsKC

  57. Posted July 13, 2015 at 6:59 pm | Permalink

    http://www.telegraph.co.uk/finance/economics/11737286/EU-demands-Britain-joins-Greek-rescue-fund.html

    “EU demands Britain joins Greek rescue fund”

    “Jean-Claude Juncker, European Commission president, discards David Cameron’s deal that spares Britain from Eurozone bailouts”

    If this is about Article 122(2) TFEU, as I believe it is, then I said at the time that it was only a political agreement and could be ignored later; what was needed was a legally binding treaty change to take the decision back to needing unanimity as it was before the Nice Treaty made it qualified majority voting, and Cameron could have demanded that treaty change in among others in return for the treaty change that was demanded by Merkel in the autumn of 2010; but that would have meant that some of the package of treaty changes would have applied to the UK, and so Hague could not have so easily used Section 4(4)(b) of his “referendum lock” law to avoid a referendum.

  58. Posted July 13, 2015 at 7:01 pm | Permalink

    As always, Ambrose Evans-Pritchard is well worth reading on this subject.

    http://www.telegraph.co.uk/finance/economics/11736779/Greece-is-being-treated-like-a-hostile-occupied-state.html

    His conclusion is that Europe’s leaders haven’t saved the Euro and the EU, they’ve destroyed it.

    An opinion which is widely shared.

  59. Posted July 13, 2015 at 8:26 pm | Permalink

    John oh John we/you are not going to change things.The only hope is to protect ourselves .Have you ever heard of che sara? You have everything you want ; a house , a family, a partner,a good job ,but the influence is slow and it won’t be until we are long gone that someone may say ‘they / Mr JR was right.’… but it will be too late. The bees went to the honey pot and found that most of their lives hard work had been taken from them .They worked so hard to make their sweet trillions and now even they are dying due to the misuse of their habitat.

  60. Posted July 13, 2015 at 8:37 pm | Permalink

    Greece: “We voted no to further austerity measures and showed that we still have some pride and self-respect”

    Juncker et al: “Aah, how sweet. Now run along and be a good boy – do what auntie Germany tells you. You belong to her now. I hope you didn’t spend too much of your post office account on that silly referendum.”

    Germany: “1 down, 27 to go.”

  61. Posted July 13, 2015 at 9:44 pm | Permalink

    And where is the gutless leadership of your party at such a time? Democracy is being burned alive in a Brussels cage.

    Britain used to stand up for democracy and the bullied. We expect nothing of the current sham of an American president, but if we can’t rely on a Tory government to stand up against European aggression, because they are busy crowing over a 9 pound minimum wage and crawling on their bellies for a couple of benefit rule amendments, what exactly is the point of the conservatives? I voted for you lot!

    To think that Thatcher was once borne of this party that lies silent.

    • Posted July 14, 2015 at 11:33 am | Permalink

      I regret to say that our government is being every bit as cynical as those of the Eurozone by acting entirely in the interest of Britain.

      Never mind the interests of the Greek people, Cameron and Osborne judge that keeping Greece in the Euro is better for the UK economy that Grexit would be so that’s what they are supporting.

      They have the added bonus of not having to contribute to the black hole that is the Greek economy to keep it afloat.

  62. Posted July 13, 2015 at 9:56 pm | Permalink

    I just learned that the very much elected EU official, Jeroen Dijsselbloem, has now been chosen to head the Eurogroup of Ministers of Finance for another two years. That doesn’t ake away from the probability that British eurosceptics will continue to view a Dutch electe politician as a “dictator”or “anti-democratic bureaucrat” or whatever else can be thought up by not very well informed people 🙂

    Reply The issue is where the sovereignty of the people rests. Most people in the EU still look to their elected national governments to reflect the popular will, which the EU now acts to prevent in many cases, as with Greek economic policy

    • Posted July 14, 2015 at 5:22 am | Permalink

      Reply to reply: 18 democratic countries, all reflecting their popular will, had no choice but to put on more pressure. The eurogroup is NOT the EU, just a group of governments.

      • Posted July 14, 2015 at 1:04 pm | Permalink

        ” The eurogroup is NOT the EU”

        That’s only true because of the UK and Denmark who have enough political clout to defy the rest of the EU. All other EU countries are required, by the EU powers-that-be to align their currencies with the euro and prepare to adopt the euro.

        But why wouldn’t they want to leave well alone, as with Poland which seems to be doing well with their zloty?

        Governments always have a choice. Some pressure is one thing , removing the democratic rights of the Greek people is quite another.

        Maybe there should be another rule to add to the SGP? If any country is default to the ECB then democracy should be formally ended. After all, what is the point of wasting taxpayers money on elections, paying MP’s salaries etc when the Government is run by appointees of the Troika?

        • Posted July 15, 2015 at 8:38 am | Permalink

          Denmark has aligned the krone with the euro for the past 15 years. Codogno and De Grauwe argue that they should either abandon the peg or join the euro.[1]

          Incidentally, Armstrong claims that in five years time at least 23 of the 28 member states will be in the eurozone.[2]

          [

    • Posted July 14, 2015 at 8:13 pm | Permalink

      Tell me, Peter van Leewen, if the majority of citizens in the Member States of the Euro zone take the view that a third bail out of the Greek government would be high risk (as well they might), how do they make their opinion prevail and stop the bail out?

      Note that I didn’t say ‘make their opinion known’, I said ‘make their opinion prevail’.

  63. Posted July 13, 2015 at 10:14 pm | Permalink

    The question to be asked is :

    How much more damage to Greece needs to occur for the Greeks to believe that Grexit is the preferable option ?

    • Posted July 14, 2015 at 1:22 pm | Permalink

      That’s a good question.

      By their own admission, the advocates of the euro, and ever closer union, in the relatively prosperous euro countries, have lost all trust and confidence, in the less prosperous countries to be able to make the common currency work.

      The richer EU countries don’t want to share their wealth in the same way that the richer US states share their wealth with their less affluent states.

      So it’s not just the Greeks who need to accept the logic of their own arguments. It’s the entire eurozone. Every country needs to exit the euro. Not just Greece.

  64. Posted July 14, 2015 at 1:30 am | Permalink

    EU economic policy is not made in Brussels but in Berlin. Germany is resolutely determined that the Euro will remain a hard currency, come what may and no matter who gets hurt. When the Euro was created, had Helmut Kohl asked the German people in a referendum whether they wanted to replace the Deutschmark with the Euro, they would have voted ‘No’. The demand for a hard currency has arisen from two bouts of hyperinflation, once in the Weimar Republic and once at the end of WW2.

  65. Posted July 14, 2015 at 1:42 am | Permalink

    May I ask a few awkward questions:
    – If the 3rd bail out goes ahead, what proportion of their money do the lenders think they will get back?
    – I have heard that the UK will have to make a contribution to the 3rd bail out. How so?
    – Why hasn’t our PM said that any contribution from the UK is dependent on a Grexit? Isn’t he supposed to be representing OUR interests?

    Reply The UK is refusing to contribute to this Euro bail out

    • Posted July 14, 2015 at 3:08 pm | Permalink

      Why hasn’t our PM said that any contribution from the UK is dependent on a Grexit? Isn’t he supposed to be representing OUR interests?

      Yes indeed we need to hear this LOUD AND CLEAR.
      Its presence or absence will be proof from Cameron of where he stands on Europe in general and this deal in particular.

    • Posted July 14, 2015 at 3:38 pm | Permalink

      Reply to reply:
      Juncker has declared that the signed agreement protecting the UK from further bailouts is just a political document with no legal provenance.

      The very fact that they are trying to renege on an agreement should be telling Cameron that there’s absolutely no point is negotiating any deals, at all, with these people- they will just tear them up at the first convenient occasion. So what’s to talk about?

  66. Posted July 14, 2015 at 5:12 pm | Permalink

    Rarely have I been so angry at reading a newspaper article but the item in the Times today about the IMF’s “debt sustainability report” that was made known to all EU leaders last Saturday made me furious.

    The BS coming out of Brussels would be a total farce if the future of several million people in Greece were not so tragically at risk.

    On Saturday, the IMF gave Eurozone leaders a written report that told them in no uncertain terms what everybody outside Brussels already knows : more austerity and at least €75 billion in new loans will not help Greece without a massive debt haircut.

    Yet they carried on with the charade of a “renegotiation” over the entire weekend which in reality was nothing more than bullying and blackmailing the hapless Greeks. The purpose ? To avoid giving Merkel and her cronies the problem of having to either sell debt relief to their electorate at home or kicking Greece out of the Euro.

    When it came, the “solution” is one that, if the IMF is right, will solve absolutely nothing or make things even worse, while being completely the opposite of what the population of Greece voted for only a week before.

    For the EU to have any future, a dose of realism and honesty simply has to be foisted on Brussels. From top to bottom the whole Brussels establishment is living in a parallel universe totally detached from reality. “Democratic deficit” doesn’t go halfway to describing the current situation.

    Somehow both bureaucrats and politicians have to be made to confront the issues around the Eurozone and the EU in general and be forced to take decisions that are practical and deliverable :

    i.e. decisions that are acceptable to the electorate in Member States.

    Quite rightly, voters across the EU must surely be regarding Brussels and the politicians as a complete joke. Such is the damage currently being inflicted that David Cameron must now be facing a real uphill struggle to persuade the people of Britain to vote to remain within the EU.

    We can only hope that he isn’t successful.

  • 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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