The euro idea was always a long term plan for the extremist europhiles but when the Berlin Wall fell both us and the Frogs (Thatcher and Mitterand) were against - and perhaps rightfuly scared of - German re-unification. So what to do? Germans in full whoop mood about re-unification and can't very well send the tanks in and rebuild the wall... I mean we had been saying the wall was 'evil' etc. So the plan was to bind them closer to the French because if they don't fall out the rest us get saved from another bloodbath sorting them out right? Well according to the files I have read this was the theory. Some disagreed, a Cabinet Minister Nickolas Ridley was forced to resign when he said publicly that the EU was "a German racket designed to take over the whole of Europe", adding that giving up sovereignty to Brussels was as bad as giving it to Adolf Hitler. What could Thatcher do though? Oppose the EU but not stop the Franco-German alliance without war, and the US would have none of that unless peace was broken in Europe, ie between France/Germany. Thatcher had no option though she knew that the Franco-German alliance was bad for Britain - the French thought it was the only hope to save themselves and we being 'allies' had to respect French wishes. In effect that was the moment the French went truly 'Vichy' and quite a few people actualy used that term at the time.
So the result of the French 'Vichy' was the Maastrict Treaty because now we need the Germans fully integrated and under some sort of control otherwise history teaches us the lesson etc... Thatcher made the mistake of signing off Maastrict on the grounds that we had stick with the French. So first we had the ERM which was the forerunner of the euro. Well the ERM was nothing more than an attempt to tie all currencies to the DM. Fortunately, as it turns out, we in Britain crashed out of the ERM and so never seriously contemplated euro fiasco. When the ERM 'trial run' had had a few years to get the different currencies aligned the plan called for the euro. Democracy etc by this time out of the window - the extremist europhiles now also have an agenda. These are the people that will 'inherit German hegemony' on the continent, thus blunting the German threat to all. These Eurocrats are mostly ex commies etc because naturaly this 'big government' and unelected power is their dream revitalised.
So along comes Phase 2 and the euro with European Constitution and the euro etc. Sadly democracy did away with the 'Constitution' but the imperative of 'wrapping Germany inside the system' remained so we got a rush job that amounts to the Lisbon Treaty, which is totaly full of contradictions (ie. can't leave the euro without leaving the EU). Well the countries that join the euro do so not because they are financialy sound (the EU can overlook that) but because this is sold as whoop time for all. In reality it is done to tie the Germans to them all; hem them into the fabric so to speak. So Europe got lumbered with the euro - or new DM - and countries that didn't meet the requirements (Greece and Ireland) were let in specificaly to pin the Germans down - some Germans knew this at the time so they never had a referendum on the euro as it would not have passed. Well guess what everyone APPEARS pegged to the euro/new DM once it is introduced so everyone gets old DM borrowing rates - free money! Of course the underlying theory of the EU is that this means Germany HAS to be 'woven into the fabric' on the grounds that if I owe the bank £100 that's a problem for me but if I owe the bank £100bn it's a problem for the bank; the old Keynesian theory. So nobody did anything the about credit boom as it added to the general theory of the fabric - same as letting falsified Greek accounts pass etc. They also planned on what in 'EU-speak' they call a 'beneficial crisis'; that is, one that alows the EU to force more integration due to the 'extraordinary circumstances'. Well here "more integration" means more power for the EU so, in theory, disabling any potential German menace - as well as the rest of us but that's just a by product so never mind.
Next came something they were not looking for - the 'Lehmans moment'. Well the US 'sub prime' mortgage selling was essentialy the same cheap credit/free money based problem that Europe was enjoying. Because we in Britain are more closely linked with US via our banks we got hit bad. I remember saying then that the banks should be alowed to go broke but the problem was that Brown wanted to be a 'statesman' and was a Keynesian at heart (all pinkos are), so we propped up the banks who had bought the US credit receits and ended up just about broke when Brown tried to spend for growth. End of Brown and good riddance!
So meanwhile on the continent the credit boom is wearing off, could only last for so long, and Greece, then Portugal then Ireland need bailouts; not because they have done anything 'wrong' (except false accounting but what the hell the EU does that) but because their currency is the euro - the new DM. Now the old DM rules, and the only reason the could rope Germany in was under old DM rules, say you pay if you have if you owe. A wise policy for long term stability and confidence. Kind of anathema to Greeks, Italians etc though who are more used to fiddling their books. Nobody ever explained to the Greeks etc that the euro was a new DM so the Greeks went off raising wages and forgeting taxes and the Spanish and Irish built lots of new houses all over because money was cheap. I started to get worried after the first Greek bailout when they said it was 'solved' etc as it cleary wasn't. That is when I started looking into files etc. Now of course we have can see the success of the euro; it is clear for all to see and still they bail out more failed Spanish banks (just like Brown in 2008 with Northern Rock etc) and Italy has pay 20% of the Spanish bank debt by borrowing at 6% and getting 3% back. The Germans, quite understandably (although they have benefited most), want the new DM/euro on the terms they agreed to. They were misled as much as the Greeks who were told "never mind about your debts - we can cover them up: Welcome to the euro!". The 'beneficial crisis' has arrived for the EU but in a way it cannot control. It has miscalculated by wide margins yet continues to try to force ever greater. In effect when they went into the euro Germany was told it was one thing (a new DM) and the Greeks etc were told not to worry about anything, false accounts etc, as we are all now in the same family.
So when the US property boom hit (Lehmans etc) it hit growth in the US and UK first as we had to bail out the banks. Thus the banks losses were in effect transferred to the sovereign account leaving us both with larger deficits. This meant we had to cut Government spending to be able to continue to borrow (as Cameron and Osborne claim to be doing) thus public spending goes down and growth declines. The European banks were not so heavily linked with the US derivitative markets on which the US property debts had been sold so didn't at first get hit as badly. However when the recession flue hit the US and UK Europe first 'caught a cold'. This 'cold' exposed the underlying contradictions in the euro system and markets realised the truth it grew ever worse until we see todays European financial 'pneumonia'. The contradictions now manifest themselves in many forms but all stem from the root contradiction that the euro is essentialy NOT a financial project but a political one designed to harness the reunified German power. The trouble is though that a currency IS a financial system, not a political one. Of course the EU was all for it as they stood to inherit overall control and as the imperative was to harness the Germans nobody much cared that EU itself was using anti democratic methods; vote no and you vote again until you say yes and then you never vote again etc. So when the US recession hit Europe the problems, which until then had been overlooked and sometimes falsified, became clear. The central financial problem for the euro is implicit in the in the way it was it was set up; promising all things to all members. Thus the ECB cannot lend to Governments (a German demand) but nobody watched what anyone was doing with their 'free money' because we are 'all in the same family' (for Spain and Italy etc) and maybe this well bring about a 'beneficial crisis' (for the EU). Above all was the central and recurrent theme of intregrating Germany into a 'greater Europe'.
British Policy on Europe
Thatcher opposed German reunification; "We do not want a united Germany. This would lead to a change to postwar borders, and we cannot allow that because such a development would undermine the whole international situation and could endanger our security." After the French 'sold out' so to speak different UK Governments have had little choice but to side, to differing extents, with the EU and to keep the UK within it either as 'counterbalance' (in Conservative terms) or more willing 'partner' (in Labour terms). The central problem still remains how to deal with the reunified Germany? This question is what has brought about the euro crisis of today as the euro is essentialy a French answer to the question and is why our FCO is so largely pro EU. I beg to differ from this view for the following reasons.
Firstly the underlying motive of this entire theory is fear of Germany. It is not said but the implications are often made that if the EU fails then war is in some way a given; and nobody wants war right? But suppose the euro does go under does this mean that Germany necessarily has to invade Poland? Or France? I do not see that this is necessarily the case. Germany is a very different country than it was in the 1930s when they elected Hitler and there is no reason to suppose that can't live peacefuly with their neighbours. At any rate they deserve the chance rather than being tricked into a misguided form of financial blackmail for their past.
Secondly this theory overlooks the role that 'appeasement' made to the last European war. Fair enough we could not forcibly prevent German reunification but the French 'euro-theory' or financial integration theory has done little more than alow Germany to grow; precisely the opposite of what was intended. In effect the discussions now taking place about austerity or growth in Europe/leaving the euro and staying in the euro, amount to how far you are willing to 'appease' Germany. IF you believe Germany is still a threat the answer is not to appease her further but get out of the system that is making her stronger. German exports to the EZ account for 40% of German trade. Devalue and return to Francs, Pesatas etc increases the price of German exports and benefits your trade balance. Staying the system ends you in debt to Germany... 'Euro appeasement' is not working and the 'integrating Germany into the fabric' theory only enhances their power.
Thirdly and currently most importantly for those of us in Britain is the EU hegemony. The Cameron Government passed a law that said no new power could be transferred to Brussels without a referendum. This of course is lies as the Houses of Parliament pass EU directives every week but means no new Treaties etc we must assume, though of course the Government decides what constitutes 'transferal of new powers'. Well it is now clear that EU is largely powerless without German money. The EU cannot bail out Spain etc... only Germany can, and only for so long. The EU banking idea recently proposed by Barruso (see past post) was immeadiatly shot down by the Bundesbank and will probably never see light of day again. Basicly we also face the same 'German question'. Apparently over 80% of British people want a vote on Europe but the Government fears this will result in us leaving and therefore having no 'counterbalance' so a vote is denied: The 'British appeasement'.
British policy on Europe has for 400 years been based on a 'balance of power' for good reason. If a country becomes too powerful on the continent it may gobble up (hi SW) it's neighbours and then one day us. We opposed Spanish hegemony in the 16th century, the French under Louis XlV and Napoleon, then German. The roots of German power lie back in the Versailles Treaty after Napoleon when Prussia was given Saxony which altered the German balance of power vis a vis Vienna and the Austro-Hungarian older Germanic power centre. Vienna lost and Prussia/Berlin won but we did not forsee what this would mean a century and two centuries later. When the consequences became clear in the Franco - Prussian war of 1870-71 and Bismarks unification we had nowhere to look for an ally to continue the balance the power other than France. Now when Germany reuinified in 1990 the French 'went Vichy' so we got half heartedly 'roped in'. Now however we see our Prime Minister "call me Dave" Cameron advocating ever greater European integration. This amounts to advocating what we have for 400 years sent our soldiers to die in order to stop: A united Europe of which Britain is not a part. In effect Cameron is advising that a Napoleonic 'European System' is good for Britain! A reversal of 400 years of policy. Why? Well primarily for financial and electoral reasons; as alot of British exports go to Europe if Europe is not growing no amount of 'stimulus spending' will help our exports to Europe unless they "sort themselves out" so we suffer, although he has also encouraged British business to find other markets and done alot to promote that. Of course if the British economy is not doing well then Camerons chances of re-election diminish. Essentialy he is prostituting British foreign policy in Europe for a short term financial gain and electoral prospects. Of course when I say 'British foreign policy' I exclude the current Secretaries at the FCO as they are hooked on the 'harnessing Germany theory'. Camerons policy is misguided in my opinion as if one power does one day control the continent this is a direct threat to Britain, and even should a unified EU emasculate a German threat the EU itself becomes a threat as it can dictate terms to Britain.
So there you have it as clear as I can express it. Sixty seven years after the last 'German war' and 22 years after German reunification all of Europe is still scared of Germany and since its reunification has been looking for ways to control it. The answers that have so far been tried are economic solutions to foreign policy problems - the underlying contradiction of the euro - and the undemocratic attempts to form a European Federal State. Both are appeasement and have lead to a stronger Germany. There does not seem to be any reason to suppose that Germany is a threat though and should it become so Britain, and the rest of Europe will need to look to the US and Russia, not prostitute ourselves further. For myself I am not convinced that Germany is a threat nor that in the event that it should become one a better handling of the situation differently than Chamberlains and our current policies could not prevent war. If we fear Germany why are we appeasing? Less Chamberlain needed and more Farage with increased military spending and closer alliance with the Commonwealth and Eastern Europe. You do not prevent war with appeasement. I thought that lesson had been learned...
On a Lighter note
Why "Sir Tankie"? Because aliens do exist! Somewhere out there there has to be life - even single cell disease type life, but mostly because he served his country.
Because truth is not carrots and I am not a bunny wabbit. Nor is:
1. “Spain is not Greece.” (Elena Salgado, Spanish Finance minister, Feb. 2010.)
2. “Portugal is not Greece.” (The Economist, 22nd April 2010.)
3. “Ireland is not in ‘Greek territory.’” (Irish Finance Minister Brian Lenihan.)
4. “Greece is not Ireland.” (George Papaconstantinou, Greek Finance minister, 8th November, 2010.)
5. “Spain is neither Ireland nor Portugal.” (Elena Salgado, Spanish Finance minister, 16 November 2010.)
6. “Neither Spain nor Portugal is Ireland.” (Angel Gurria, Secretary-general OECD, 18th November, 2010.)
7. "Spain is not Uganda" (Spanish PM, Rajoy to Luis de Guindos, economy minister… last weekend.)
8. "Italy is not Spain" (Ed Parker, Fitch MD, 12 June 2012.)
9. "Calais is not England and Britain is not Europe" (moi ever.)