“Eurozone as it currently stands is not immutable, or inevitably dying…”

If anyone is still listening to experts for remain, here’s one worth paying attention to before the drop… It’s Simon Wren-Lewis responding to the brilliantly written and honest outline by Ambrose Evans-Pritchard I covered in yesterday’s Report of why he’s for leaving:

The fact that democracy was overridden in Greece so cruelly was not the result of actions of unelected bureaucrats, but of elected finance ministers from the other union countries. One reason these finance ministers refused to write off any debt was because of pressure from their own electorates.

This exercise in raw political power worked because the Greek people wanted to stay in the Euro. The ‘bad equilibrium’ Evans-Pritchard talks about happens in part because of democracy. The lesson I would draw is that union governments should not lend money directly to other union governments, precisely because governments are democratic and so find it hard to accept write-offs.

He also points out that there is no pressing ‘need’ we can expect to get bombarded with nnow for the UK to pull out…

The Eurozone as it currently stands is not immutable, or inevitably dying, or some kind of monster that is bound to ensnare the UK or bring it down. If the Eurozone did become one of these things, we can always exercise our option to leave. In contrast, once we leave, it will be a long time before we can change our minds.

 

  • chrisjones2

    The problem is when and how it ends. I fear the Euro will die quite quickly and unexpectedly and in a damaging manner. Exiting at that stage will not be a controlled process. Better to get out now …and prepare our own contingencies

  • Kevin Breslin

    Sterling isn’t going to last forever, how do you see it going when it dies?

  • scepticacademic

    Surely democracy was overridden in Greece because the democratically elected Greek government joined the Euro (with the full consent of the Greek people), thereby condemning itself to the consequences of the fiscal straight-jacket that comes with currency union? The was only enforced on Greece when Greece brokes the rules (although the underlying structural tensions in a currency union of unequals perhaps made this inevitable). So, how does this relate to the UK? The UK is not a member of the Eurozone and Eurozone finance ministers nor the ECB have any (direct) influence over UK fiscal policy or monetary policy. The UK is effectively fiscally and monetarily independent within the EU with the benefits of access to the Single Market. Surely the best of both worlds?

  • Chingford Man

    Gibberish. Sterling will be here long after the Euro has likely collapsed.

  • Roger

    in short, best prepare for doomsday…
    suggest populace buy in canned foods too.

  • Thomas Barber

    Put it this way Kevin, if the City want a Brexit there will be a Brexit, and if they do, then you can be pretty sure there is a coming financial collapse but of course Sterling as always, will, just like it has done throughout the centuries, survive. Its the oldest currency in the world still in use and it is also the third most held reserve currency in global reserves. The City are after all the same people who can if they wish either destroy a nations economy, bankrupt it or ensure it thrives, are you suggesting a Brexit would put at risk all the privileges, power and control they have built up in the City over hundreds of years.

  • chrisjones2

    No ….vote leave and avoid doomsday in the UK

  • chrisjones2

    possibly with a long slow whimper ….but its been with us for hundreds of years and ITS OUR CHOICE in how we manage it

  • Angry Mob

    Greece joined the Euro based upon a lie; after the figures were manipulated by Goldman Sachs and against the EU’s own rules that it had set out, they should of never have been permitted to join.

  • Mary Rader