Douglas Carswell's Blog

Bailing out the Euro

When the Coalition government recently signed us up to new rules for pan-EU economic governance, ministers implied that we'd be exempt because we're outside the Euro. 

Yet now it seems that the Euro is a debt union as much as it is a currency union.  And Britain is part of it after all.  Liable to the tune of £7 Billion, indeed. 

To put it in context, that's more than we struggled to reduce public expenditure by when we first came to office.  Yet those savings have now been soaked up by our massive contribution to bailing out the Euro.  Austerity at home, yet expensive bailouts to the EU.  An odd way of defining our national interest?   

Of course it is in our interest to see Ireland prosper.  Which is precisely why we must be prepared to help her escape from the Euro.  Until Ireland does so, she will either remain uncompetitive or suffer a fall in per capita GDP - or both.   

Yet today's bailout means Ireland moves in the wrong direction.  Rather than exit the Euro, accompanying the bailout are new rules on pan-EU economic government.

Instead of helping the Irish people, which is the right thing to do, we are bailing out her politicians from the consequences of their Euro folly.  It is worth remembering that the Irish people rejected precisely those EU treaty arrangements under which the bailout is now being imposed.

It is difficult to see how it is in either Ireland or Britain's national interest for the UK government to be spending money in order to impose more Europe on Ireland - when it was too much Europe that got Ireland into this mess in the first place.

And if a common monetary policy doesn't work for Ireland, how much more will we be liable for when that home truth kicks in in Spain, or Portugal, or Italy? 

One casualty of this crisis is the credibility of those in London who pretend that the new system of pan-EU economic governance agreed to this summer does not apply to Britain since we are outside the Euro.  There's now £ 7 Billion on the table that says it does.

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