The EURO will not save manufacturing It is a frightening experience reading this years TUC motions on Europe with their apparent universal approval of the European Union’s Single Currency experiment.
It appears that the movers of these motions have collectively suspending their critical faculties in order to find a quick fix solution to the crisis in Britain’s manufacturing industries.
The fact is that this blinked sectional approach will not lead to a long term revival in this area, but will prevent any future implementation of a coherent national manufacturing strategy and will undoubtedly devastate large parts of the economy which rely on public expenditure and investment.
So lets focus on what the TUC is being called on to do. It is being asked to ‘call on the Government ..to announce at the earliest possible moment the date of a referendum on joining the euro’ and then ‘to obtain the support of working people in the UK for a positive vote in the referendum’.
In other words the TUC is being called on to urge their members and their members’ families to vote for Britain to sign up to a European super bloc of countries dominated by big business interests, to which all other concerns are subordinated.
They are being urged to support a Europe where:
But, what the hell! May be signing away all our hard earned democratic freedoms, along with our welfare state, will be worth it; so we’d better look at the arguments that have been put forward for joining in with this monetarist EMU experiment.
However, the idea that this country will enjoy stability by having the euro is based on wishful thinking rather than concrete evidence.
The fact the single currency has plummeted since its launch only exposes this reality further.
The idea that this country will lose investment, and our manufacturing base will collapse, if it does not abolish the pound is also very contentious.
The official statistics publication of the European Commission, Eurostat, has stated that in 1999 Britain received over 50% of all investment from across the world placed in the EU.
Other statistics, specifically on manufacturing, from the Office of National Statistics show that between 1992 and 1999 manufacturing employment in Britain rose by 0.5 per cent.
In France, it fell by 10.2 per cent and in Germany by 17.3 per cent.
The idea that this country will benefit because our public spending, and employment rights, will somehow be improved to the European average, ignores the fact that across Europe public spending levels are being reduced.
Whether you look at pensions being slashed and the retirement age raised in Italy or benefits being cut in Germany, the reality is that the rest of Europe’s public spending is being lowered to bring it into line with the monetarist expectations of the Maastricht Treaty.
But the rest of Europe has an excuse for sleep walking into a monetarist experiment as they didn’t have to endure Thatcherism and our 18 years of Tory government.
And be in no doubt, this is Thatcherism on a European scale.
This has been proudly declared by ex-European Commissioner Sir Leon Brittan when he boasted that Europe has moved massively towards Thatcherite policies over the past decade and all the things that he had fought for as a Conservative have now been blazoned across Europe because of EMU.
Finally, the idea that this country will benefit by handing over the ability to decide exchange rates to the European Central Bank is a dangerous illusion, it simply means bankers based in Frankfurt decide a ‘one size fits all’ economic policy which will, inevitably, not suit all parts of the EU.
It is this point which is worth dwelling on, as it has proved to have been madness to impose one interest rate on so many divergent European countries. With Ireland’s economy overheating while Germany is demanding low interest rates for its struggling economy.
A report entitled ‘ The Euro and Regional Divergence in Europe’ by Kent University Professor Tony Thirlwall warns that entering the EURO would widen the gap between Britain’s regions.
Thirlwall states that the economic and social disparities in the EURO zone are vast and likely to widen, placing European economic and political stability at risk.
What consideration then will the European Central Bank give to the economic problems of Wales, Scotland or the English regions when compared to those of Germany or France?
Since it’s launch on January 1 1999 to much corporate fanfare the European single currency has operated as planned, that is in the interests of the biggest economies in Europe, namely France and Germany.
European Central Bank president Wim Duisenburg made it quite clear that this would be the policy when he said, ‘policy will be directed towards the French and German economies, smaller fry with other needs come second.’
The arguments in favour of joining the Single Currency have been exposed as wishful thinking at best and capitulation to big business profiteers at worse.
There isn’t room here to lay on with a shovel the arguments against joining but may I suggest you look up the Maastricht Treaty and the Amsterdam Stability Pact and discover the monetarist economic constraints and the powers to enforce economic policy onto member states regardless of the trade cycles which exist in the different countries.
I also suggest you consider the relationship between these policies and the privatisation policies across Europe and the adoption of PFI and PPP to finance public works.
Trade unionists should indeed be at the fore front of the Single Currency referendum campaign and should be demanding a positive vote.
But the positive vote should be for democracy, for trade union rights, for a national integrated and publicly supported industrial strategy and, therefore, for a No vote.