Britain in the Euro

[V-J]

Originally Posted by Devolved

I understand the butterfly effect

I really, really don't think you do. Or at least you're only prepared to apply it in the most unrealistically limited fashion.

[Devolved]

Originally Posted by V-J

I really, really don't think you do. Or at least you're only prepared to apply it in the most unrealistically limited fashion.

Since I linked Andy Murray winning Wimbledon to Blair entering the Euro then I don't think you can accuse me of applying butterflies in a limited fashion!

[El Danoo]

Though I'm all pro-european and all that jazz, Britain would be in a worst position than it is now, most likely just behind Spain and Italy. However, having the third largest economic power in Europe backing the euro might give the currency a bit more power; though I find the idea of Queenie Liz being on the euro coins/notes quite amusing.

[Amakan]

Originally Posted by Devolved

What the hell has 9/11 got to do with Blair and Brown?

They were behind it all, duh.

Personally I can't think of a way without making it look thoroughly ASB.

[Simon]

Originally Posted by The Professor

Hhmm, did you watch that Eurocrash programme on BBC2 last night? Basic points re UK politicians is that all competent Chancellors of the Exchequer knew full well the problems that becoming part of the Euro would entail so we not only have to neutralise Golden Brown as Chancellor but also other members of the Treasury.

The Euro has always been much more of a political thing than an economic one. Since Blair gets to appoint anyone he feels like from the Parliamentary Labour Party, within reason, he can shop around for someone to give him the 'right' answer about the Euro - hell, it worked for Iraq. He doesn't even need to listen to the Treasury and the right Chancellor can help keep a lid on them. Just paint it as being 'good Europeans', maintaining or increasing Britain's influence in the EU, a mix of other vacuous sound bites, fudge the economic numbers on the benefits of joining, or just outright lie and you can get away with it.

... (let's avoid the political argument of how nuts a monetary union without political union is )...

Why not? I mean the people that created it and the politicians that signed up for it all pretty much did.

Originally Posted by The Red

Prevent the 'Granita Deal' from occurring, Brown runs against Blair but Blair still wins by a significant margin.

This seems the most likely. I generally see Brown working himself into even more of a huff than he did in our timeline about being denied what was rightfully his by this johnny come lately, although possibly being bought off with the offer of the position of Chancellor of the Exchequer. However with no Granita deal Blair doesn't feel the need to put up with him and his antics when he starts throwing his toys out of the pram later on, his bitterness over not getting the top job probably helping to exaggerate his somewhat thuggish bent, and he gets demoted to the back benches. With no guaranteed prospect of the leadership after Blair, not having the influential position of Chancellor to play patronage with, and his at times rather anti-social tendencies he isn't able to build up his cabal and launch into almost guerrilla warfare.

[RousseauX]

Originally Posted by Monty Burns

We should remember that Eurozone could be out of this problem rather fast if ECB was willing to accept inflation rates as high as in the Anglosphere, thus inflation rates the "PIIGS" were used to before the Euro. I'd recommend that actually - but then I'm young, my major asset is discounted working income and I'm working in a profession that grants me raises far above the inflation rate. I won't be hit that hard from that strategy...

You would need inflation in the double digits all across Europe as a form of revaluation to have a chance of getting Greece out of it's current account deficit.

[Jape]

Since butterflies has come up, surely having Britain in the Euro would change the global economy and the recession?

[Nanwe]

Originally Posted by Jape

Since butterflies has come up, surely having Britain in the Euro would change the global economy and the recession?

Of course the conditions might change, and with an Britian using the €uro, probably in 2000 and 2003 Denamark and Sweden would join the eurozone (tbh in Denmark the difference stood at a 3-4% and iirc in Sweden too).

And although a British euro would chnage the world economy, it will not butterfly away the massive building bubble, that sooner or later (unless an extremely competed Fed. Reserve) will explode provoking a financial crisis too.

[Monty Burns]

Originally Posted by RousseauX

You would need inflation in the double digits all across Europe as a form of revaluation to have a chance of getting Greece out of it's current account deficit.

At the moment, I really don't know what could rescue Greece.

But even less than double digit inflation could do a lot to help Spain and Italy.

[stodge]

I think it's possible for Britain to be part of a European Monetary Union but there have to be a couple of significant changes;

First, the events of September 1992. Had the Major Government agreed to a devaluation within the ERM which was on the table the weekend BEFORE September 16th, the events of Black (or White depending on your perspective) would not have occurred.

Thus, Britain remins in the ERM and while I think it's still highly likely the Conservatives would have lost an election as they had been in power so long, the depth of their defeat is less and the margin of Blair's victory is less as well.

Ken Clarke becomes leader of the Opposition in 1996 or 1997.

Meanwhile, the ERM countries discuss a new single currency which they will call the Crown and ensure each nationality can keep its own insignia on its coin. The Crown will be introduced on 1st January 2001.

The Blair Government calls a referendum on the UK joining the Crown - the Tory leadership under Clarke is supportive, the rank-and-file less so and the party begins its long journey to eventual schism and the creation of a new anti-EU party called UKIP. However, the referendum passes 61-39 and Britain joins the Crown.

[Xgentis]

Many republican countries would refuse such a name as Crown why should the name be changed in the first place?

[Nanwe]

Originally Posted by Xgentis

Many republican countries would refuse such a name as Crown why should the name be changed in the first place?

Because the name Euro was a last minute decision and was grudgingly accepted by Germany among others, they would surely have preferred others, maybe even keep ECU (European Currency Unit iirc)

[Dathi THorfinnsson]

I expected theyd keep "Écu"... in english, european currency unit, in france an old coin.

Other countries could use their word for shield.

[Plumber]

No Granita Deal. Perhaps even as POD as late as the one in For Want of a Vote can suffice. IDS stays on.

Originally Posted by Amakan

They were behind it all, duh.

Personally I can't think of a way without making it look thoroughly ASB.

No Blair, different Balkan Wars, which can certainly butterfly away 9/11.

[Genmotty]

What is known with 'certainty' if Britian joined the Euro around 2008;

1. The exchange rate value of the Euro would increase dramatically (by about 40% according to the Telegraph). Thus allowing for several years of cheap international trading with the other monetary markets. Pro.

2. Bank of England interest rates would drop (about 5%), thus slowing the 'Credit Crunch' in Britian and across Europe. Pro.

3. The equvillent worth of the Euro post Britian joins, to pre Britian joins goes from €1:80p €1:£2. This is amazing news for France, Germany, Poland, Holland etc. but a much greater disaster for the weaker economies of Europe like Italy, Spain, Greece, Czech Republic and would risk Europe having to split into a two stream economy system a couple years later.

There could be deflation or stagflation in Britian during this process; Pros & Cons

4. Long term (5-10yrs), the UK exchange rate with America may be lowered to below what it would be with retianing the pound, thus causing a loss for British businesses only if they keep their investments in North America.Those investments will need to be moved to Europe or Asia to prevent this. Con is no action is taken, Pro for Europe if action is taken by Britian.


5. Would force the UK out of being able to 'borrow its way out' of financial crisis. While this means lack of government control to take action independant of Brussels, it is the first step that many people have been calling for in montary reform policy in capping the government deficit. Pro reform, Con control.

Sources:
- A selection of news group articles (Guardian, Telegraph, BBC, New Statesmen)
- Background knowledge

-------------------------

The best call is for when £1 = €1 for the two currencies to lock-step on the global money markets, then hope to 'cut a deal' with the Americas for dollar-pound trade that is seperate from dollar-euro trade. Allowing much of the strengths of the montary union to come true, albeit somwhat reduced since people would be able to buy pounds or Euros seperately still.

The downside is Europe might not like this, because its like Britian giving itself a safety net which they can fall into at any time they think Europe is going down sh*t creek. i.e. the recession that was began in America and spread to the UK, then causing the Eurozone crisis might have awakened calls to seperate the currencies. This would hamper the Euro overnight, and so Britian could hold a defacto gun to the head of the European monetary system.

Obviously many in Europe would see this negatively.

This is why the Euro as is, is not designed with an easy pull out manover like this, such that indervidual nations can't unstabilise the entire union.



Britian would be much better off today if it had joined the Euro suffering a much lessened recession due to better international exchange rates and lower home interest ones. However we would still have about 4 years before the Dollar-Euro problem would hit Britian thus this would need a future resoluton.

Apart from banker/investment stakeholders in American businesses, their is no real credible reason for Britian not to join the Eurozone single currency. Unfortunatly try telling that to the stubbon predudiced Brits who love their eccentricity . Because of this, the UK Media prints the rhetoric that it would be a 'terrible idea' for Britian to join.

Indeed you can see that both Blair and Brown knew the score that it would benifit the UK, but wouldn't be able to swing the population overnight. Therefore Blair got the 'pro-europe' feeling going, then Brown gave his 5. key points that would need to be fufilled, softening us up for the day with the '3rd labour government' that would say that these conditions were met etc. etc. helping to lay the groundwork for a future integration.

Hell, that's me being cynical about the whole situation, but it makes a lot of sense that no British government is going to be popular for joining the Euro even if it makes sense. Therefore you'd have to soften up the people (who are the main blocking reason) to accept a future integration.

Unfortunatly Cammaron knows sh*t all about the economy and I can't believe some of the idiotic crap he's come out with over the last couple of years to this score. His economic philosophy has been debunked by a TED talker, several montary reform groups and other inderpendants. In affect 'muddling britians way through' the Credit Crunch.