Paddy Ashdown has a thoughtful piece in today’s Times (£) making the counterintuitive argument that Britain would be better off if it had joined the euro. He argues that joining the single currency would have forced Britain, like Germany, to improve its economic competitiveness and maintain fiscal discipline since it would no longer have been able to devalue its currency or borrow to maintain living standards.
The weakness of Ashdown’s argument is that the Stability and Growth Pact, which prohibits eurozone members from running deficits larger than 3 per cent, was repeatedly flouted by France, Germany and other European Union members, who went unpunished by the EU. There would have been nothing to stop Britain doing the same (or worse). But Ashdown’s piece remains an important corrective to those who simply indulge in the politics of Schadenfreude.
Ashdown is one of several British europhiles who have rallied to the single currency’s defence in recent days. Michael Heseltine declared yesterday that Britain would be forced to abandon the pound and join the euro “faster than people think”. I’ve compiled a list below of prominent figures who continue to argue that the UK could join the euro. Do let me know of any I’ve missed.
‘If you’re looking at the very long term and assume the euro stabilises, we should certainly always keep the option open of doing it”.
Tony Blair, 13 November 2011
“I think we will join the euro. I think the chances are the euro will survive because the determination, particularly of the French and the Germans, is to maintain the coherence that they’ve created in Europe.”
Michael Heseltine, 20 November 2011
“So should Britain join the euro now? Of course not. But we should not exclude the possibility. This is what separates us from the eurosceptics. We still say that if it becomes in Britain’s interest to join we should. They say that even if it were in Britain’s interest to join we shouldn’t.This could — sooner than we think — become much more than just an academic question.”
Paddy Ashdown, 21 November 2011 (£)
“If and when the economic circumstances were right and to Britain’s advantage, we should certainly consider doing so [joining the euro].”
Peter Mandelson, 14 November 2011
Certainly nothing is going to happen in the next decade but I find never say never in politics is a very good rule
“He [David Cameron] should say that while it was right for Britain not to join the single currency as it was previously constructed, if Germany were to act responsibly, Britain would peg sterling to a reformed euro and in the long run even consider joining the regime.”
Will Hutton, 13 November 2011
“Certainly nothing is going to happen in the next decade but I find never say never in politics is a very good rule.”
Ken Clarke, 25 July 2011