Making one mistake doesn’t entail that the source is untrustworthy, yet that is what Leave campaigners seem to be saying about Remain

 

One of the points hammered home hardest by Vote Leave campaigners is how the same ‘experts’ who recommend staying in the European Union, also supported the UK joining the European single currency (Euro).  It is clearly a fallacious argument (but that is to be expected), to state that just because an organisation got one piece of advice wrong at some time in the past means that from then on they will be wrong on every subject forever and a day.

When the Bank of England and the Treasury are attacked, there is a complete departure from facts.  The late Eddie George, then Governor of the Bank of England, at the time of the adoption of the Euro said that it would take 300 years before the Euro could be judged and George’s successor, Mervyn King, has been a true ‘Eurosceptic’. Meanwhile, the man who compiled the Treasury dossier on remaining in the EU was the same one who provided the spadework for Gordon Brown’s five tests for entry, which ultimately blocked Britain’s entry to the Euro.

Sadly, few, if any, Remain campaigners have pieced together this abuse of facts or semantics — maybe they too agree silently on the Euro being a failure.  When you see Greece being held over a barrel, Germany and Finland demanding a pound of flesh while agreeing to repeated bailouts and Portugal, Spain, Ireland, Cyprus and Italy struggling, how could one judge it otherwise?  But possibly, just possibly, would it have been bad for Britain to join?

The Euro itself was created in the wake of the fall of the Berlin Wall and French president François Mitterand demanded that if West Germany was to absorb East Germany, the price of unification would be the Germans giving up the Deutschmark and becoming evermore embedded in European integration.  The law of unintended consequences has meant that this exact scenario played out because of the single currency.  The membership criteria was very flexible, allowing Greece to join (although even then Athens had to ‘cook the books’ to achieve it), but the European Central Bank being located in Frankfurt was indicative of which country would have the greatest clout.  The UK was not a part to ameliorate a distinctly German-model application; that lasted until Mario Draghi took over.

Joining the Euro project in June 2003, when Brown definitively ruled out membership, would have been too late, having to agree to rules that had been composed without British input.  After rejecting the offer of being a founder member in 1957, the UK soon realised its folly but had to wait until 1973 to gain entry, working within an existing framework that was not Anglo-Saxon (no bad thing?).  With the Euro, that again would have seen Britain late to the party.

Though John Major’s government was not in a position to follow through, being neither ideologically inclined or with a sufficient majority, the real time to engage with our European partners in the project was after the Maastrict Treaty in 1993.  Denmark’s referendum rejection of it allowed Major’s unruly backbenchers to gain the upper hand and achieve major opt-outs, including moves to a single currency.

With the UK helping to build the rules that incorporated its own interests, the Euro may have been more robust and Greece may have had to wait a lot longer before joining.  Arguably, had Britain been more committed to European integration, that project may have been more of a success in terms of benefiting the UK as well as more generally. But the insular political nature of this island country would always have militated against that.

Critics of both left and right might say this exegesis is hypothetical Panglossian rhetoric. Yet it’s no more of a counterfactual than saying Britain avoided a fate worse than death in not joining the Euro.  One might criticise a one-size-fits-all monetary policy between such divergent economies as London and Scotland/the north of England — how far must one atomise?  The Euro in its current form is in a mess, yes, but the contrarian should never close themselves off to possible optimistic lines of enquiry as guides to the future, if not laments to the past.