silver_sun
09 December 2011 @ 10:00 pm
Occasional politics type post.  
I didn't think that I'd ever say it, but I actually agree with the Tory PM decision not to sign the new euro treaty. 

Having looked at what we'd have been signing up for I don't think it could have gone any other way. I'm surprised that pretty much all the other Eurozone countries have committed to it. 

I've seen a lot of comments on the BBC 'have your say' page where people are saying that he only failed to sign up for it because of the bank tax issue, that all he's doing is protecting the bankers. I don't like how the banks and those in charge of them run things, but they account for a substantial amount of money coming into the country and something in the region of 11% of the entire tax revenue of the country as well. The way in which the tax was planned risked driving them away. 

There are other things in the treaty - although I suppose I should stop calling it that as it seems to have been decided that it isn't actually a new treaty just an amendment to the old one, therefore it can be introduced without any votes, referendums and they can have it in place by March, which is the current plan. 

Other things such as automatic financial sanctions against countries who don't keep their national debt within the agreed figure, and that decisions that once had to be unanimous to pass now only have to have a majority vote. 

So basically the main reasons that the UK has refused to sign is 1. we couldn't be given any guarantees that European Central Bank wouldn't demand that all financial clearing houses had to be in Countries which had the Euro as their currency. 2. We wanted to keep the unanimous vote for financial changes rather than majority ones, and 3. We wanted all transfers of supervisory or regulatory powers to EU institutions also be made subject to a unanimous vote, rather than the majority one being proposed. 

A monetary union couldn't work with out a fiscal one, not in the long term, and that was something that was know back in 1999 when the Euro was first used. What I wonder about is whether in the long term, or even the short term given the current economic situation, if European countries are unable or the population unwilling to comply with the terms of the new treaty whether there will be a push for political union as well, to make sure that all the governments of the various countries of the Eurozone are on the same page. 

For anybody who is interested the proposed treaty amendments can be found here: http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ec/126658.pdf 

Only time will tell whether it has been the right economic decision for the UK, but at the very least it appears to have been for the right reasons. Which is more than can be said for an awful lot of the other things the this and the previous government have done. 
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