Thursday, 7 June 2012

Welcome to my club


How easy it is to jump onto the bandwagon of popular opinion.
For years, UKIP have been labelled everything from fanatically anti-European to xenophobic for holding the view that the European Union was bad for Britain. As recently as a couple of years ago, throughout the early months of my tenure as an MEP, I received accusations of scaremongering if ever I suggested the Eurozone was doomed. Those critics have fallen strangely silent of late.
Now politicians from across the political spectrum are championing a British exit from the EU, warning of the dire economic consequences of prolonging the single currency without fiscal unanimity and bandying about suggestions of an in-out referendum. All of a sudden our party line is trendy.
One thing is for certain. For the single currency to survive member states must forge closer economic bonds, to the extent of becoming a single federal entity (the argument is that the EU has borders, a flag, an anthem, a Parliament, an army, foreign policy, a currency and laws, so the only thing separating it from a federal state is the lack of tax raising powers). If this does not happen, the Eurozone will, eventually, implode, and in doing so, force the UK into a decade of depression.
Of course, the UK would resolutely not wish to be part of a federalised super-state. It raises the question of what sort of relationship we could have with a new Europe. UKIP has always championed a relationship akin to the current Swiss model, where free trade and continental cooperation remain priorities, despite not being a member. This is now being mooted by politicians who but a few months ago championed a more integrated European Union, only to find their subject today ridiculed by fate.
Either way the tapestry that has been woven by Brussels over the last five decades is unravelling at an alarming rate. Spain requires a £100 billion bank bail out to save her finances. The incomprehensible nexus that has formed between the Spanish state and the banking sector means the Government can no longer sensibly bail out the very banks that have been bailing out the Government. The Spanish Finance Minister has resolutely denied needing a bail out, but we’ve heard this before. Greece, Portugal and Ireland all said the same thing. In the UK, the Government recapitalised British banks to the tune of £1 trillion, a measure that was widely criticised on the continent as too closely bound to Anglo-Saxon capitalism. But it saved us from the economic disaster we are now seeing affect banks in the Eurozone’s largest economies – even in Germany. It’s estimated at least £200 billion must be injected into Eurozone banks to stimulate borrowing capacity, but in order for this to happen Germany must essentially underwrite all single currency loans.
It’s understandable that Germany doesn’t like the idea of so-called “Eurobonds”. Why would they? Holding them culpable of the debts of their neighbouring countries is hardly going to seem fair to the majority of Germans. Meanwhile Spain wants a bail out with no strings attached. Of course they would. They can see what has happened in Greece, where desperately ill people are queuing outside pharmacies for life saving medicines as stocks run dangerously low. Germany does not want Spain to get a free handout without agreeing to fairly stringent conditions. And thus we are left trapped in an ever revolving circle of national self-interest that is leading critics to cry out for the greatest seismic shift in political power ever seen by Europe – the move to federalise the Eurozone before the clock ticks down, despite such a schismatic resolution flying in the face of democracy.
What about the UK? What do we want? We need Eurozone banks to be protected. Barclays is exposed to Spanish banks to the tune of £26.5 billion. RBS is liable to £14.6 billion if they do collapse, while Santander, one of the high street’s biggest financial retailers, is actually Spanish owned. Then there’s our economy. In many respects inextricably intertwined with European markets, not just through EU membership but as the result of simple geographic positioning.
The most sensible answer would be the UKIP option. Leave the EU, enhance trade with traditional partners in the Commonwealth and demonstrate neighbourly cooperation and free trade with Europe as is the modus operandi of Switzerland and Norway.
As part of the Queen’s Diamond Jubilee celebrations, a lunch with Commonwealth leaders was hosted at Buckingham Palace. We were reminded that our Queen is not just the head of state in the UK. She is Queen of Antigua, Barbados, Bahamas and Belize, Canada, Grenada, Jamaica and New Zealand, Papua New Guinea, St Kitts, St Lucia, The Grenadines, the Solomon Islands, Tuvalu and Australia, as well as being head of the 54 countries that make up the Commonwealth of Nations, including India, Nigeria, Pakistan, Singapore, South Africa and Kenya. These are long established natural allies of Britain, countries with a diverse diaspora, different geographical landscapes and as a result, present true international trade opportunities.
This year Commonwealth GDP will soar past the Eurozone’s. While the Eurozone will grow by only 2.7% if it manages to avert fiscal disaster, the Commonwealth will be boosted by 7.3% growth.
I’m not bitter that my views are now being championed when for so long they have been slated. I would be a poor politician were my pride more important than my conviction. I just hope the newest recruits to Eurosceptic ideology have strength enough to hold as steadfast to their beliefs. For what Britain and Europe needs more than anything right now is a steady hand on the tiller.



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