On the European Union VoteAll over on the 23rd June. IC is covering this extensively now such is the jitter it is causing in UK markets, this is my take:
I am without question a Europhile. I have spent the past 4 summers touring Europe. While Europe is in my experience a very civil place, the continent's grasp of economic logic is not it's strong point.
On a tour of the Acropolis in Athens last October, our tour guide, a historian and linguist of considerable knowledge was happy to discuss the Greek economic predicament. We touched upon the Euro, how exit would allow debt write down, the need to collect taxes consistently, a smaller state, business friendly government policies and so on. Our tour guide's view was that these were secondary issues and that if the 'primary issue' was addressed, then all of Greece's economic problems would be easily resolved. And what was this primary issue? The payment of additional war reparations to Greece by Germany. I don't doubt the horrors imposed on Greece by axis powers in the 40's, but if they still believe this to be the primary cause of their current woes then what can one say!
The single currency is the real European disaster. Approaching high oil prices will probably bring it all to a head. Italy is in no shape to withstand the inevitable recession and will probably leave the Euro, devalue by c30%, placing severe strain on their creditor French banks and in turn French public finances and so on....
I will vote to remain - Europe is not going anywhere and neither are we. Nearly 8 years after the financial crisis we have a sizable deficit and an alarming debt which will be cripplingly large once we emerge from the high oil price induced recession - and we can't even use the Euro as an excuse - we can hardly claim the economic management moral high ground. We need to be part of the solution when the time comes.
Europe - c7% of the global population, c25% of the global economic output, making c58% of the global welfare payments. We are as much a part of this unsustainable nonsensical situation as the rest of Europe, walking away from Europe will not fix anything.
Doug
10:38 PM on 23/5/2016