Monday, 23 July 2012

We Need to Talk about Europe

With stock markets around the world falling and rumours of a bailout of Spain once again in the ascendant, it was illiminating to watch the CNBC take on all of this.

One of their pundits, Jim Cramer, expressed two interesting opinions. One, that in fact, nothing substantive had changed over the past three years and every attempt by the Eurozone to restore confidence had failed and that the US economy was in a healthier state than every European economy with the exception of Germany.

On the first point, I well remember that the Monday after the election, when the markets were went to be in freefall because no Government had been formed, they surged on a bailout deal for Greece. For the past two years and more, we have seen played out a Greek comedy or more accurately a tragedy with overtones of farce. Elections have come and gone as have Prime Ministers - all manner of "plans" have been trumpetted and none of them have worked for very long. Some indeed have unravelled within a few hours.

Now, Spain stands on the precipice with bond rates approaching 7.5% while those of Italy stand at 6.3% or thereabouts. The bailout of an economy as large as Spain and the rescue of its banks will be a major undertaking for the Eurozone and will test its viability to the limit.

We in Britain may scoff at all this - we aren't in the Eurozone and it's a jolly good thing we aren't so claim many. That said, and to paraphrase an old adage "if the Eurozone catches a fever, we'll get a nasty chill". A large part of our trade and our economic dealings is with Europe and Eurozone countries. A Europe in recession or worse Depression does none of us any favours.

Apart from the shrill rantings of the Europhobes insisting anyone who even mentioned the possibility of joining the Euro be metaphorically tarred and feathered, the fact remains we are still in the European Union and need to have a relationship with the rest of Europe.

Geography, history and culture combine to re-enforce our insularity - we stood alone against the Hun in 1940 (aided by the English Channel of course. Had the panzers been able to drive the twenty-two miles from Calais to Dover there's no doubt we'd have succumbed just as France did). We use that insularity to promote a kind of smug superiority over Europe and trot out age-old stereotypes based on experiences of war about the Germans, French, Italians and others.

There was a time when the Conservative Party was the most pro-European of the main parties. Up to 1983, Labour were still calling for withdrawal from Europe while Edward Heath and his generation of post-war Conservatives were following the spirit of Winston Churchill in advocating a closer relationship between Britain and Europe.

All that has changed - the Conservatives are split from stem to stern on Europe and everyone knows it. Were there to be a referendum on Britain's continued membership of the European Union, those divisions would be laid bare much as Labour's were in the mid-1970s. This is why David Cameron does not want and will not allow a referendum however shrill the cries from his backbenchers, members and activists. He cares little if they move off to the irrelevance that is UKIP as long as he can keep his party united.

Ultimately, even if the Eurozone fails or fragments, the European Union itself will endure and as America turns increasingly toward the Pacific to observe an economically resurgent and possibly militarily resurgent China, its interests will turn away from the backwater that Europe may become.

Yet with Russia and the Middle East on our doorsteps, Europe does matter and our involvement in that matters too.

The Conservatives have always tried to come out with daft slogans about Europe - a "diet of Brussels" (remember that corker).

My adage is much simpler - "a part of Europe, not apart from Europe". The siren calls of the sceptics and the Europhobes need to be confronted and challenged and driven back into the darkness. There is no future retreating to some Imperial pre-1914 idyll when we could ignore Europe and prosper without it. Our destiny and that of the Eurozone are inextricably linked.


Gawain Towler said...

'This is why David Cameron does not want and will not allow a referendum however shrill the cries from his backbenchers, members and activists. He cares little if they move off to the irrelevance that is UKIP as long as he can keep his party united.'

It is an odd sort of unity that sees your hardest working activists leave to a more honest party

loadofoldstodge said...

Thank you for the comment, Gawain.

I was thinking about how parties are perceived and how a referendum on an internally-divisive issue can intensify divisions.