Merkel and Sarkosi entered the gladiatorial arena, that is the Euro crisis, and presented their plan for a German Forth Reich as the solution to massive Euro Zone debt. The finance markets responded with a very firm thumbs down.
What the markets wanted to hear was that immediate steps would be taken to underwrite bonds issued by Euro Zone countries. What they got was a crude attempt by Merkel to turn the Euro crisis into German political profit with Sarkosi tagging along behind.
Not surprising that the markets gave a firm thumbs down to the way that the Euro Zone is responding to a probably terminal crisis.
The Franco-German led Single European Currency has always been regarded by shrewd currency dealers as a disaster waiting to happen. The evidence suggests that the markets are now betting that Greece and Portugal will be forced out of the Euro. There is some evidence that Britain will be prepared to help Ireland re-establish the punt as a sovereign currency. That leaves Spain and Italy exposed. If currency dealers win their bets on Greece and Portugal, they are unlikely to be satisfied and will turn on Spain and Italy. There is real money to be made out of forcing the Euro apart.
The only option likely to fend off the dealers would be for the European Central Bank to issue Euro bonds backed by Germany. The danger is that Germany is now itself exposed, a situation unbelievable only weeks ago and a sign of how Euro dithering and denial has created a very deep and serious economic emergency. Germany is exposed because dealers are coming to realize that Germany is determined to cling to the Euro Zone and attempt to expand it, but does not have the funds to bail out all the other Euro members. French debt and a growing bank crisis are also coming to be understood better.
Merkel and Sarkosi seem to believe that somehow they can saddle non-Euro Zone member Britain with the bill and at the same time destroy the London markets to the advantage of their own stock, commodity and currency markets. What they are more likely to achieve is the rapid exit of Britain from the European Union. With a very clear majority of British voters saying that they already want to leave, any additional efforts to rob Britain will force the Coalition Government to accept the will of British voters and withdraw from the European Union. The process of withdrawal is much more simple than many believe. Under the British Constitution, it has long been accepted that no British Government is bound by the decisions or indecisions of any previous Government. All that is required is an Act passed by Parliament to affirm that Britain is a sovereign nation and all legislation passed previously as part of EU membership is now null and void. That would be the cleanest and most straight forward approach to declaring independence from Brussels. Future trade would be subject to GATT agreements and reciprocal trading with European countries. As trade between Britain and Europe is firmly in favour of Europe, any attempt to introduce trade constraints by Brussels would end up damaging Europe and befitting Britain.
So what could Europe do if Britain left the EU?
One option would be to attempt an invasion but that is not likely in view of the military strength of Britain and its ability to target Brussels, Paris and Berlin with submarine launched cruise and ballistic missiles.
The more likely response would be a welter of words and petulant attempts to deny markets to British companies. Even when Europe faces a very clear danger such as the Euro crisis it demonstrates an inability to act, covering its dithering by mountains of meaningless words and idle posturing.
So what could Britain do after leaving Europe?
The answer is – a great deal!! Since the traitor Heath mislead Britons and signed up to the European Federal Project, Britain has been seriously damaged by European membership. This damage is at every level. As seen recently in an outbreak of street violence, Britain has caught the European plague and now needs urgent medication to restore democracy, remove corruption, return to competent Government. It will not be an entirely painless process because a generation of police officers and political representatives have been contaminated by European socialist corruption. A generation of adults have been contaminated by the Human Rights legislation, excessive dependence of welfare benefits, ambulance chasing lawyers and the police state. A generation of children have been betrayed by very poor education and a lack of any concept of honour, duty, responsibility, civil order. A generation of businesses has been contaminated by abuse from Brussels as they are strangled by Brussels originated red tape. The wealth creation under the Thatcher Government has been thrown away under the Blair Brown regime as it tried to be a good poodle to Brussels and run up huge public sector debts while reducing the services provided.
The greatest service to the peoples of Europe could be performed by the European Union shooting itself in the corporate head and allowing Europeans to emerge from the mess to build strong and co-operating economies.
The great tragedy of the European Union is that it has betrayed and ignored the people. A political elite has maintained that there is only one way forward to a German dominated Federal State where the people have no rights or value except where granted by the political elite. European countries could have formed a Confederacy where they worked together co-operatively without losing the power and quality of their national heritage and worked in equal co-operation with nations outside the geographic boundaries of Europe. The EU was formed of fear of Germany and vanity of France to produce a new super state that had no equal and could humble the United States. It has been a protective trading area that has consistently attempted to ignore the attempts of GATT to produce an open and fair global market. The recent case of illegal Airbus funding demonstrated the lengths Germany and France are prepared to go to in ignoring the rest of the world. Neither France nor Germany have pulled their weight in maintaining NATO and in working to establish peace in Afghanistan or dealing with any common external threat, expecting the United States and Britain to provide the military commitment and shoulder the financial burden of doing that.
Lets hope that 2011 becomes the Year of European Independence and sees the breaking of the EU shackles.