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Euro kidding right UK?
Former Member
Posts: 1,876,323 The Mix Honorary Guru
I know that the European Common Market is already one of the world's important market. But once the UK gives up its currency as well as some of its autonomy isn't that a heavy sacrifice. I read studies, that I can't substantiate here, that listed the British as being more productive. And isn't the UK less leftist? Also won't the UK lose agility with another layer of politicians?
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Bear in mind that there are a few economics students here!
You might want to check out a couple of the other threads on this before you start. This, I think, was the best of them:
€uro Debate
Of course it's a heavy sacrifice. One that should not be undertaken for a long time.
And how do you define 'more productive'? France and Germany have higher productivity rates than the UK (if measured using GDP per worker for example).
More productive. Well here's something I read. In Sweden, some shops are only open 5 hours a day. It's because if the owners earn too much money, the government begins to take 70% out of their earnings. so people in the UK work more. Of course, the article also said health coverage is total in Sweden. In the US, you lose your job and if you stay unemployed for a long time, there are some government programs but you won't get the best health care. However, Germany's economy is a mess compared to ours and their are more jobs. One reason for this is that if it's more expensive for a company to operate in Germany...even if it's for good reason like the benefit of workers...they just go and build in another country.
So I don't know what the answer is.
In Germany, people can go to training classes to start new careers. Trouble is, what many people are training to do, free of charge, there are no jobs openings for right now. This just illustrates the well meaning inefficiencies of big government.
By and large the EU only has authority in areas of common interest to all member states and the rest is the domain of national governments to handle.
Now having said that, what most Brits fail to appreciate (given the very low level of EU information circulated to the general public in the UK apart from inflammatory tabloid rubbish) is that final decisions at the EU level are the responsibility of the national Ministers anyways. Which means that in cases where the EU gets flamed by the public over a given policy or harmonised regulation, it is their own government Ministers which have agreed upon it.
Too much bickering ends up clouding the whole Eu topic over such issues as Farm subsidies, heck the whole Common Agricultural Policy (CAP) in general, as well as Fisheries.
If the EU is criticised for not fulfilling a greater role in areas like Defence or Industrial Policies, its because to date the CAP represents more than 60% of the overall EU budget expenditure to the dtreriment of other vital concerns.
With the coming enlargement I suspect we will see great dilution of interests without subsequent reforms of the CAP. This will keep the process of effective integration and social, economic reform at a snail's pace, sad to say.
The Euro represents a loss of a level of UK autonomy. It may well be economically sound, as I believe I argued in the previous thread, but for a nation-state to cede control of it's economy is a dubious idea.
I suggest you read Kenichi Omae's book, The Bordlerless World to get an understanding of the myth of economic sovereignty.
Whether the UK joins the Euro sooner or later, economic and business reality make it a huge strain for UK business growth by remaining outside and forcing those who are conducting transnational business to incur unnecessary added cost and lost revenue due to constant conversions.
The nightmare scenarios imagined by the trashier UK tabloids have not come to pass on the continent and will unlikely take place in the UK should it adopt the Euro.
As for Germany, their crisis is systemic in nature and due to unresolved lingering problems incurred by a badly and too highly optimistic unification process in which the Deutschmark was severely diluted when then Chancellor Kohl issued a 1:1 rate for the Ostmark in order to provide some solvency for the new reunited East German lander.
Additional ripple effects caused by financial overextension in the business comunity from the late 90's have also contributed to this mess.
To say its the fault of the Euro might sell newspapers in the UK, but its far from the actualities of the German economic decline.
The fact that monetary policy is decided by the ECB makes Euro membership foolhardy.
Such an interest rate would not be set for the benefit of the British economy. Besides, the UK is outperforming many other Eurozone nations now. We don't need to join.
Virtually all eurozone economies are suffering from lower GDP growth. Part of Germany's problems are that the labour market needs to be liberalised. Also, the poorer economic performance of the former DDR (, i.e. East Germany) is hindering the former Western part.
... and move this up a scale. The poorer economic performance of e.g. Italy/Poland/wherever would hinder the UK's performance in a Euro economy.
All it takes is the jobs to go from poor areas to the prosperous and a country will pull out, thanks probably to a right-wing government, and the Euro will collapse. I don't want to be in it when it does. (and it will)
Also when Markets are low we lower the rate of the pound. We loose that ability so Britain will go to hell as long as France and Germany are prosperous (and Vice Versa)
Saying that it is true. We're screwed if we don't join.
For your information my friend, London is far more expensive a city to live in than most continental cities. The cost of living in Brussels is probably half that of London, especially in the housing sector.
That Scandanvia is costly wasnt your initial conjecture. You specifically claimed that London was less expensive than continental cities which is blatantly false.