For sometime the Euro has been off colour. That’s what we have been told – it’s fine, just a sniffle, and it will running round like normal soon.
Today it is clear that the Euro is in huge trouble. Finance Ministers from around the Euro zone are looking at the patient, as its lifeblood is slipping away by the minute. How can they save it? Could the Euro zone survive this loss? Where does that leave the whole EU project?
The Euro was a flawed idea. When the UK struggled with a two-speed economy, where for a long time the South East overheated helping to creating a house price bubble, alongside some regions that were faring much worse, a one size fits all interest rate was tough.
How could the whole of Europe align their economies when at one end you have a technological manufacturing economy like Germany, a world leader in manufacturing exports, alongside Greece, where the economy is slower, based on different sectors and where tax avoidance is a national past-time?
The answer is simple – the criteria to join the Euro was fudged.
We are now left with a situation where Greece is certain to default – all that is needed is for a way to default that doesn’t say default on the label.
Portugal and Ireland are living through Austerity measures that means economic growth sufficient to pay these debts and return to normal looks impossible.
Italy’s massive national debt is in focus, and if the bond markets keep increasing the rate of return they want, the mother of Euro bailouts beckons.
As Euro zone Finance Ministers look at the patient, surely they should let the Euro slip quietly away to a dignified death.
After the funeral life post-Euro can begin. This should lead to a new Europe – more democratic, not controlled by the European Central Bank, and each country returning to independent currencies to allow them to set the interest rates and tax regimes that suit the citizens of each country.
Perhaps we can return to the notion of a Europe where we trade freely with each other, work together on big issues like climate change and finally admit that economic and political union doesn’t work and is not wanted by the people of Europe.