l****z
发帖数: 29846 | 1 The euro is doomed to fall apart: no, not because I'm some nasty man in UKIP
but because the basic idea was such a terrible one. Our chart above (from
JP Morgan Asset Management, which you can see more easily by clicking here)
shows just how terrible it was. It would, in economic terms, have been
better to have a new currency for all countries beginning with the letter M
than for the eurozone. Or for all countries that have the 5th parallel North
passing through them.
Yes, of course, we all know, the euro is the bright new dawn, the vital step
in stopping Germany from invading France. Again. No one seems to have
noticed it that they managed it last time and having experienced the place
seem to have no desire at all to go back. So this might not be a problem
that needs a solution.
However, let's look behind the political posturing and ask ourselves whether
, in economic terms, the euro was a sensible idea. The structure we need to
help us decide is Robert Mundell's concept of an Optimum Currency Area. We
should look at things like language barriers, labour mobility, capital, the
similarity between economies, their reaction to external shocks –
essentially what has been worked out for us in that chart.
And, as you can see, it's a blitheringly stupid idea to try and push
countries into the same currency just because they happen to be next door to
each other. People would have been better off if we'd insisted that the c.
1800 Ottoman Empire had the same currency again: Tunisia, Turkey, Israel and
Greece. Which is a real indication of how dumb it was to try and get Greece
and Germany into the same currency.
So a very silly thing done by those Very Serious People who have decided
they'd like to rule us.
There is one further thing. It is possible to take an area which is not an
optimal currency area and make it more so. This is what Lord Mandelson is
talking about when he parrots the line about a "fiscal Europe". The idea is
that if the rich areas send money to the poor areas then the effects of
being lumbered with the wrong currency can be mitigated. As indeed they can:
London sends vast amounts of money to the north of England and Scotland and
this helps reduce the impact of the Pound Sterling itself not quite being
such an optimal area.
Over larger areas and numbers of people, the US is regarded as a good
example. However, it is worth looking at quite how much money has to be
sloshed around America to achieve a single currency. Some would argue that
it's the welfare state bit of the Federal government, perhaps plus the
military, that does this. That's about 5 or 6 per cent of US GDP. Others
argue that it's the whole of the Federal government that does it, around and
about (outside current blowout deficit times) some 20 per cent of the
entire economy.
Which is fine if that's your sort of thing. But now try and move this over
to the European scenario. The US government, all levels of it, takes some 35
to 40 per cent of GDP. That's two fifths of everything that everyone
produces in a year. And this is after they've done that fiscal sloshing
around to make up for having a single currency.
Here in Europe, governments take 40 to 50 per cent of GDP, two fifths to one
half, before they've started to chuck the cash around to pay for the vanity
project of the euro. We'd have to take in tax another 5 to 20 percent of
everything produced and ship it off to the poor countries to achieve what
the Americans have: a single currency that doesn't cripple those poor areas.
Five per cent of the UK's GDP is £75 billion or so: that's more than
all council tax and all business rates. Twenty per cent is £300 billion
Can we see any possible future in which we (or the Germans, the Finns or the
Swedes) agree to pay such taxes so that we can build a Common European Home
– or, if you like, to subsidise the countries which we really shouldn't
have a common currency with?
No, quite. I can't, either.
Look at that chart again. The UK and its English speaking offshoots: the US,
Canada, Australia, New Zealand and so on. They make up a more logical
single currency area than the eurozone. The euro was and is an insane
economic idea balanced on the nonsense upon stilts of a very silly indeed
political ideal.
And, let me remind you, just because you want to ignore economics does not
mean that economics is going to ignore you. |
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