Eurozone Sovereign Debt Crisis part 2 - Ireland

[eurotop40]

The UK is hardly the sole (and certainly not the largest) net contributor to the EU budget, which again is only part of the picture.

Which countries are net contributors to the EU budget? / EU-Oplysningen

Have you ever heard Belgium, or The Netherlands, or Italy, or France complaining and wanting to "renegotiate"? OK, they don't drive on the left neither are so-o-o-o-o- special with the whole Windsor circus...

 

[Jason]

We need blunt talking. Maybe this was what Cameron was doing and which upset Sarkozy. There are two and only two solutions to the euro crisis.
1) The EZ becomes a single nation state with a common fiscal and domestic policy.
2) The euro fails and the nations of the EZ return to their own currency.
Anything else that politicians suggest is a lie for home consumption. I don't think there is the will among the peoples of the EZ to see their sovereign states come to an end, so (2) is the only solution. The costs will be enormous. People living in the EZ will get much poorer.

At the recent Conservative party conference many senior Conservatives spoke of the folly of the euro. The problem for the UK is that we will undoubtedly get the fallout. We are looking at a situation where on top of our own very difficult economic position we are looking at the failure of our largest market plus contributing to IMF bailouts for the whole EZ. If a few billion pounds of UK money could somehow stop the rot in the EZ it would make sense to pay - but it won't. Bailing out the EZ doesn't need €2tr, rather around ten times this.

The UK, with the USA and others, needs to get this point across through G20 and elsewhere. This includes bringing into the public domain the absurd views of France and Italy. Germany at least has an idea with a hint of coherence behind it. If all the EZ people want to become like Germans we could have a single sovereign state governed from Berlin. But leaving this aside ww need a managed retreat from the euro.

 

[Perados]

i think there are more people who would akzept an EZnation... You just need to explain it good... So option one is possible in my thoughts... At least in germany

 

[eurotop40]

i think there are more people who would akzept an EZnation... You just need to explain it good... So option one is possible in my thoughts... At least in germany

I think Switzerland is a good example for an EZ nation.

 

[Jason]

The Swiss model is a fascinating one. The level of independence of the cantons is such that there are even arguments for considering the cantons to be almost sovereign states, and Switzerland therefore as an international federation. And of course Switzerland does this across the four-way language divide and a religious divide. The great unifing forces are:
1 Relative similarity in economic development of the cantons along with broadly similar fiscal and domestic policies.
2 Popular support for the idea of Swiss identity.

The EZ is totally lacking in (1) and has problems with (2). Right now Belgium, Italy and Spain have strong forces which tend towards breaking them up. There are plenty of people in Milan who don't identify as Italian, let alone as European. Italy is pursuing domestic spending which shows no respect for the needs of the EZ.

If the EZ does go for the single nation state solution then the euro crisis would be solved and the UK/USA would be very happy. But it would have to happen very quickly. IMO it just isn't possible on the timescale available, even if people in the EZ would support it - I just don't see this happening. Therefore the euro must fail. Sarkozy appears to be in denial. Indeed his policy seems to be keeping the euro going until after the French presidential election. Berlusconi seems more bothered by the supply of young women to satisfy his sexual excesses than the fate of Italy or the EU. Merkel seems to have a degree of sense. The Spanish press seems to have all but stopped reporting euro problems (maybe tucked in the business pages). Right now the key is that EZ politicians recognise that the euro will fail and manage the process.

By contrast the UK has a vote around 10pm where a lot of Conservative MPs look like rebelling. The biggest previous rebellion is 41. There is talk that this could be 60-100. There is a degree of expectation management from the government, but anything over 41 will be a victory for the pro-referendum lobby. This issue is going to come back again and again in UK politics. It will prompt a more Euro-sceptic policy, and a greater frankness by UK politicians in speaking out against the folly of the euro.

 

[eurotop40]

... The great unifing forces are:
1 Relative similarity in economic development of the cantons along with broadly similar fiscal and domestic policies.
2 Popular support for the idea of Swiss identity.
...

1: pfpfpf, nope, sorry
2: after 160 years, yes

 

[deleted213967]

We need blunt talking. Maybe this was what Cameron was doing and which upset Sarkozy. There are two and only two solutions to the euro crisis.
1) The EZ becomes a single nation state with a common fiscal and domestic policy.

Huh?

Why would that be necessary?

I am all for fiscal harmonization and simplification, including between the US and the EU.

However, even within the US, tax policies between states differ dramatically. That's in part how Texas ended up gobbling up populations of other states, most notably tax-greedy-and-yet-still-broke California.

What the EZ needs to do is follow its own rules.

 

[dandelion]

1) The EZ becomes a single nation state with a common fiscal and domestic policy.
2) The euro fails and the nations of the EZ return to their own currency.

Occams razor: the simplest solution is the best. Therefore, do nothing.

EZ isnt going to become one nation and you know it doesnt need to. I recall you once quoted a report by someone demonstrating it is already an integrated economic zone, and it certainly is. The knot it has got into right now is the fiction that states may not default within the system, whereas obviously they can. We continue in a holding pattern until either Greece defaults, or it doesnt. If it doesnt for long enough then the crisis is over. If it does, then we manage the issue. Many banks have already been preparing for this and even some of the worst off seems to have done rather better than expected. So I guess Greece will be kept on drip feed indefinitely while people wrangle about finding a solution. The ECB will continue quietly adding to its collection of Greek bonds ( and others), thereby effectively quietly easing quantitatively until hopefully it has a full set of bonds at least from those institutions within the EU.

Someone suggested today that maybe the conservative mPs most exciteable over a referendum are those with very small majorities. The chap from the polling organisation said that frankly people in the UK absolutely dont care whether britain is in or out. My mother said she didnt realise we were in it. Perhaps because they changed the name several times since joining. Its a total non issue. They pointed out today that Mrs Thatcher was pro eu.

 

[deleted213967]

The UK, with the USA and others, needs to get this point across through G20 and elsewhere. This includes bringing into the public domain the absurd views of France and Italy. Germany at least has an idea with a hint of coherence behind it. If all the EZ people want to become like Germans we could have a single sovereign state governed from Berlin. But leaving this aside ww need a managed retreat from the euro.

Dude,

You've got to be the most jingoistic and certainly one of the most stubborn members of this forum.

No hard facts or figures anyone may throw at you will shake your bizarre conviction that the UK is somehow in a position to act as The Co-Leader Of The World.

Still, thank you for not completely relegating the US to a cameo role on the world stage.

 

[Drifterwood]

Still, thank you for not completely relegating the US to a cameo role on the world stage.

In 500 years this may be the conclusion of historians. You never know. :wink:

 

[Jason]

80 or thereabouts Conservative EuroSceptics have defied a three-line whip to vote for an EU referendum. This is an enormous rebellion. It is on the high side of expectations.

It is likely that this will force Cameron to be more EuroSceptic. It has certainly created a group of 80 Conservative MPs who will become an identifiable group and get more support. The phrase being used is that EuroScepticism now "goes mainstream" in parliament, and will therefore follow through into government policy.

 

[deleted213967]

80 or thereabouts Conservative EuroSceptics have defied a three-line whip to vote for an EU referendum. This is an enormous rebellion. It is on the high side of expectations.

It is likely that this will force Cameron to be more EuroSceptic. It has certainly created a group of 80 Conservative MPs who will become an identifiable group and get more support. The phrase being used is that EuroScepticism now "goes mainstream" in parliament, and will therefore follow through into government policy.

Will South London get its own currency once the UK breaks into medieval fiefdoms?

Should American tourists staying near Paddington expect to clear customs (with moats and alligators) before reaching their South London clubs?

 

[Jason]

We already use eight different sets of banknotes within the United Kingdom - that's just the official ones. Bank of England notes are mostly for England and Wales. Scotland has three issuing banks, and Northern Ireland uses the notes of four issuing banks, two of which are based in another country (Ireland). Curiously the town of Lewes has already issued its own unofficial currency Lewes Pound - Wikipedia, the free encyclopedia - it is getting some use. Isle of Mann, Jersey and Guernsey have their own currencies on parity with sterling.

 

[deleted213967]

We already use eight different sets of banknotes within the United Kingdom - that's just the official ones. Bank of England notes are mostly for England and Wales. Scotland has three issuing banks, and Northern Ireland uses the notes of four issuing banks, two of which are based in another country (Ireland). Curiously the town of Lewes has already issued its own unofficial currency Lewes Pound - Wikipedia, the free encyclopedia - it is getting some use. Isle of Mann, Jersey and Guernsey have their own currencies on parity with sterling.

Well, if you folks don't even believe in a UK, how could you possibly believe in a EU...

 

[Klingsor]

We already use eight different sets of banknotes within the United Kingdom - that's just the official ones. Bank of England notes are mostly for England and Wales. Scotland has three issuing banks, and Northern Ireland uses the notes of four issuing banks, two of which are based in another country (Ireland). Curiously the town of Lewes has already issued its own unofficial currency Lewes Pound - Wikipedia, the free encyclopedia - it is getting some use. Isle of Mann, Jersey and Guernsey have their own currencies on parity with sterling.

Why stop there? Let's all just use pigs and chickens, like in the good old days.

 

[deleted213967]

Why stop there? Let's all just use pigs and chickens, like in the good old days.

So what's the price of gold in chickens?

 

[Klingsor]

So what's the price of gold in chickens?

It clucktuates.

 

[Perados]

or one goldnugget for a chickennugget... And mcdonald's is the zentral bank...

But that more and more areas use there own currencies in germany and austria to... I guess also in swiss
And i know some citys in brasil to... But this system works good as long as the local economy doesnt need to export and not to many areas can do so or the hole system would became to expensiv... But its a very good idea to support a weak economy area...

 

[Drifterwood]

or one goldnugget for a chickennugget... And mcdonald's is the zentral bank.....

I'll be rich. No chance of me ever wanting to eat the money. Vegetarians will take over the world. The chickennugget will fall and we will trade in carrots.

 

[deleted213967]

I'll be rich. No chance of me ever wanting to eat the money. Vegetarians will take over the world. The chickennugget will fall and we will trade in carrots.

It is the Central Bank's third installment of Quantitative Greasing that will ruin the economy for good.