Save The Pound – and lose your job

The Tories have just dumped their ridiculous pledge to reduce taxes no matter what the economic circumstances. And while others condemn this as a U-turn (which of course it is) I would welcome it as common sense. But then I find myself wondering when they will dump that other foolish pledge – not to join the euro. Or rather not to join yet – a bit like Labour’s policy really. Except that the Tories say they would not join for the life of the next parliament – not even if it was clearly in our interests to do so.

There are several strands to arguments about the euro, and all of them are entangled with myths and prejudices.

I have written here before, and I still believe, that one of the least desirable legacies the Tories bequeathed us was the stifling of debate about Europe. The reasons are obvious – neither Mrs Thatcher nor John Major could afford the massive split in their party that a genuine discussion would cause. But the result was that despite taking us into Europe and signing the Maastricht Treaty, the isolationism and internal strife of the Conservatives when in government has left us on the margins of Europe.

The press also bears some blame. ‘Euro-nonsense’ stories have filled countless column inches over the years, creating the impression that nothing good comes from Europe, only farcical red-tape.

There is, for example, a common belief (especially among butchers, for some reason) that metric measures were imposed on Britain by Brussels. But in fact the decision to introduce metrication in Britain was taken by Parliament many years before we joined Europe, under the Weights and Measures Act of 1963. Who benefits from the perpetuation of such myths?

“Tales of ‘barmy’ European law are meat and drink to the headline writers. These stories are often pure fiction, or garbled accounts of perfectly sensible measures. They do real damage because they play on popular fears and prejudices.” That’s the view of Rt. Hon. Sir Malcolm Rifkind, former Conservative Foreign Secretary.

Indecision over the euro and an obsession with pandering to the euro-sceptic press is in danger of overturning any influence Labour’s more positive approach has gained.

Over 3 million British jobs are dependent on our place in the European Union. Hague’s Save the Pound campaign has failed to explain to people how his policies will protect their jobs. For example, in Castle Point Labour had a majority of 1,143 over the Tories at the last election. 2,347 jobs in Castle Point are reckoned to depend on Europe. Will people vote to keep the pound – and lose their jobs? We have lost 250,000 manufacturing jobs since 1998; staying out of the euro will cost many more.

Outside the single currency, trapped between the euro and the dollar, the pound is condemned to a highly volatile future. Sterling’s current over-valuation is just the latest symptom of this problem. The problems that the high pound is causing for firms like Corus, Ford, and Nissan show that staying out of the single currency is not a cost-free option.

British homeowners’ mortgage payments would be slashed if the UK joined the European single currency, according to a study published recently. The study by ‘Your Mortgage’ magazine, which compared the cost of home loans in Britain and the Irish Republic, inside the euro, revealed that an Irish homeowner borrowing £100,000 would save a massive £62,450 over 25 years – or £208 a month – compared with a British borrower. Andrew Stuart, the magazine’s editor, said: “If the UK joins the euro it will mean a massive cut in Middle Britain’s mortgage bills”.

Although our interest rates seem low at the moment, they are still nearly twice the rates in the rest of Europe. In whose interest is it to keep our mortgage payments so high?

Within the euro zone, companies are aligning their prices – while in Britain consumers are still being ripped off. In whose interest?

Keeping the pound will increase your mortgage, increase prices in the shops, and might cost you your job. In whose interest is it to keep quiet about these things?

Sovereignty is an issue often raised but rarely discussed intelligently. Have we forgotten the devaluations and interest rate hikes of the last forty years, under Labour and Tory governments, caused by events beyond our control? Is that the sovereignty we hanker after? In the euro zone, we will regain real sovereignty over our monetary affairs and real control over our economic environment.

People seem to forget that money is a convenience to make our lives easier, not a piece of national bunting to be waved.

Finally, while we’re on the subject of Europe, anyone care to guess whose sensible words these are? “It is a myth that our membership will suffocate national tradition and culture. Are the Germans any less German for being in the Community, or the French any less French? Of course they are not.” Well said, Margaret Thatcher!