Global economy: Britain out of Europe

 
David Cameron

Today's headlines have rightly focused on the starkness of David Cameron's message - his warning that the world could soon be staring down the barrel if eurozone governments don't tackle their debt and their lack of competitiveness.

However, just as significant - at least in the long term - is the fact that the British prime minister wrote his letter calling for action to save the world economy not with European leaders but to them.

Cameron's joint signatories were his Canadian, Australian, South Korean, Indonesian and Mexican counterparts. In other words, on the biggest macroeconomic policy question of the day Britain is not part of Europe, it is looking on from outside.

When Ireland first got into trouble the prime minister told his advisers that he was minded to give a speech calling on the eurozone to take the next logical steps towards integration.

He felt that his call would carry weight given that it would be coming from a British, Eurosceptic Conservative. George Osborne was amongst those who said that that was precisely why he should not make it - the risk was that it would look like another British lecture to a club we'd refused to join.

Besides, went the argument, the EU will muddle through - they always do. Finally the PM has delivered his message along with members of the Commonwealth and developing countries.

Britain's relationship with the EU is changing not because of any decision taken in Westminster or by the British people but thanks to "events, dear boy, events". Whether you find this a relief or a frustration is a good indication of whether you are a Euro-sceptic or a Euro-enthusiast.

If you feel a bit of both you are where the pollsters say most voters have been since Britain joined the Common Market - that is, someone who believes we cannot afford to be out but doesn't much like being in.

For years our political leaders have tried to change the attitudes of a country summed up by that old newspaper headline - "Fog in the Channel. Continent cut off." The headline these days should probably be just one word - "Fog" - although perhaps a second headline might help "No-one can see where they're going."

PS The prime minister clearly signalled in his Channel 4 interview how he would react to Lib Dem Cabinet ministers asking him to spend or Tories who might call on him to cut taxes:

"[B]ecause we were left such a massive budget deficit there isn't the opportunity to cut taxes and spend more money...you can't spend your way out of a debt crisis."

He also indicated that he is putting his faith in the Bank of England and supply side measures to stimulate growth:

"Interest rates are already incredibly low but I believe in monetary activism, using monetary policy where possible. But the most important thing we can do is actually to improve the productivity and the efficiency of our economy. Make it easier to employ someone. Make it easier to set up a business. Make it easier to grow, to build, to expand. Those are the steps that we're taking in a very, very aggressive growth plan."

 
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  • rate this
    0

    Comment number 260.

    250 John_from_Hendon

    "I wonder why Nick R's latest blog is not available for comments?

    Could it be BBC political bias?"
    =====

    About Ed MIliband's comments, ideas, vision, policies etc ? Perhaps the BBC want a blank sheet of paper about... well...er.... a blank sheet of paper....

  • rate this
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    Comment number 259.

    255. Strictly
    This isn’t about private v public sector. Pensions or pay. Its about tightening any slack in performance. Responsibility, accountability, working smart in areas of the civil service that need it. You know I believe in the public sector. Lots of good people there, perhaps in some areas they need some more, along with some reform. All easily possible under the public umbrella.

  • rate this
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    Comment number 258.

    254 john.251 feed.255. strictly248. john from h.
    Im positive under the right conditions, civil service can operate more efficiently/effectively. If I was a government minister and not an IT expert, I would be relying on people below me who negotiated/managed contracts etc to know what they were doing. If an idea is wrong its wrong, if it had legs id expect to be able to delegate confidently.

  • rate this
    -1

    Comment number 257.

    I thought moribund was learning but in his pre-conference guardian interview he is quoted as;

    "We have got to break this government's addiction to austerity because it is not working," he said.

    Nick Robinson hailed milibands 'big new idea'

    sounds like a rather old idea - tax and spend - borrow and spend.

    I suppose there will be some that will still vote for that.

  • rate this
    0

    Comment number 256.

    248 JFH think you are discounting the cost of being part of a statist regulation driven club. Its bad enough to cope with all the drivel that westminster chruns out. Yes it provides access to a large market but this can be had without even being a full member (ref Norway). The currency risks are only material on longer projects and they can be hedged. Not a huge problem for what UK want to sell.

 

Comments 5 of 260

 

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