Or the conference before the Visegrad 4 one or something like that. Lots of people earnestly talking about cooperation and Europe and stuff. Definitely the B team on display which was why I just scraped into an invite. Frances Coppolla and I did a panel, should Greece leave the euro? Which Frances has already talked about (my answer, Hell Yes, everyone should leave, it’s an idiot way to run a continent).
The interesting bit was how scary it was in fact. The groupthink is strong in this arena. There is no questioning of the goal, even if it’s not clearly delineated. That ever closer union is just assumed: how to bring it about being the only difference anyone has. I was the only truly eurosceptic person there and I wasn’t on the panel discussing eurosceptics for example (Frances is reasonable on this subject where I am not).
At one stage I pointed out that fiscal union simply was not going to happen. Europeans just are not going to allow 15-20% of GDP to be distributed through Brussels, which is what would be needed for the automatic stabilisers to operate properly so that the eurozone comes even close to being an optimal currency area. To do that really does mean German taxes paying Greek pensions.
It. Will. Not. Happen.
Not this century at least.
Everyone was shocked: how could you say such a thing? And anyway, we need to work out how to make this happen not think of why it cannot.
What’s scary about this is that these are the people (the varied policy wonks, political aides and so on who made up the audience) who are actually deciding policy within that EU bureaucracy. and they’re simply off with the fairies. The demos is something to be managed, not something to be regarded as the fount of legitimacy. Something to be imposed upon, not something to be listened to.
It’s out of this sort of mindset that we get the recent one from Martin Schultz. Only those who sign up to European values should be allowed to be elected to the European Parliament. EU values of course including ever closer union etc. Not all that odd a socialist shouting that only those who agree with him can stand for election but what’s remarkable is the lack of people pointing out the idiocy of the idea.
They’re seriously dangerous these people. Not listening to that demos, locking it out as they wish to do, is going to cause that very unrest that they say they wish to avoid.
For the record my argument was very simple and it’s the one I have been making for 20 years now. The eurozone is too large to be an optimal currency area. There will always be asymmetric shocks across such an area: that’s just the same statement. Asymmetric shocks means your single monetary area is too large. You can increase the size of this areas by moving to fiscal union. But Europeans just aren’t ready to do that (my phrasing was, go to Germany, state that half of German taxes must be paid to Brussels so that German taxes really do pay Greek pensions. You’ll be gutted and hanging from a lamp post before you’ve finished your speech). Thus, too large a currency area, local monetary policies not possible to deal with asymmetric shocks, (examples being Spain and Ireland pre-crash, Greece and Finland now), we’re always going to have asymmetric shocks and we can’t have a common fiscal union simply because the people won’t wear it.
Thus we should not have the euro. Everyone should leave.
Wasn’t a popular reading of the runes that one. However true it actually is…..