Every day I read the voluminous comments of eminent economists and columnists who make predictions about the future life or ultimate death of the European Community and the Euro. Just like climate change scientists, they are poles apart in their viewpoints, and so I can’t claim to be providing you with ground breaking comments that will be accepted by all. I just want to raise a few basic issues.
The concept of a united Europe was a good idea that gained life soon after the end of World War 2, but it has proven to be a flawed vision. The great nations of Britain, Germany, France, Spain, Portugal, Italy, Austria, etc, have been at war with one another for at least a thousand years, and the lack of trust that generated those wars has not abated.
They now do not have a genuine desire to save one another from bankruptcy, because pride in being a European does not exist. If it did, they would have moved rapidly from an economic union to a political one some years ago. Now, it is too late.
Their current economic woes are the direct result of the centuries in which they practiced colonialism. They lived a grand life by plundering the wealth of their colonies, and when they lost those colonies just after the Second World War, they were saved temporarily by massive American aid through the Marshall Plan, which was intended to ensure that they did not turn communist.
When they found that it was time to finally look after themselves, they formed the European Economic Community, which was intended to make them competitive with the United States. But, instead of investing in a potentially prosperous future, they set-up abnormally generous welfare programs while employing a massive number of bureaucrats in Brussels who lived off the fat of the land and achieved very little, while their industries fell behind the rest of the world, especially China.
Now, they are a pathetic rabble crying out for someone to save them from their irresponsible years of living on borrowed money, provided by bankers who could not believe their luck in finding irresponsible governments who were desperately eager to become their clients and pay them exorbitant fees for the privilege. They now have no option but to break apart and solve their own destinies, while putting every bureaucrat in Brussels out into thin pastures where they can try to earn an honest living —presuming that they understand what that is.
The place to start is by getting rid of the Euro right now!
My simple understanding of economics tells me that you can’t establish a currency unless it is backed by both the monetary and fiscal policies of a nation in the same way as the American Dollar, the British Pound and the Japanese Yen. Thus, the Euro is a currency of convenience, owned by no-one. It is valueless because people like Angela Merkel would rather operate with the German Mark once more instead of trying to prop-up the Euro in an unenthusiastic effort to save millions of lazy people in places like Greece, Italy and Spain.
It seems to me that, instead of throwing good money after bad by trying to pay back sovereign debts to irresponsible lenders, it would be far better to invite private equity from around the world to buy the hundreds of badly-run government enterprises that abound Europe like railways, power stations, ports, etc, and give those nearly-bankrupt nations some cash flow — while at the same time have those currently-useless state assets run efficiently and profitably for the first time, giving investors a good return and stimulating national economies in the process.
This probably means that, by peaceful means, Germany will end-up owning a lot of Europe, a feat that Adolph Hitler failed to achieve by force.