Letter: Euro opt-out is for the birds

Sir Frederic Bennett
Tuesday 10 December 1996 00:02 GMT
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Sir: One aspect of the current controversy about how deeply we ought, in regard to the management and control of our national economy, to become integrated with the EU, seems not to have been adequately perceived by the Euro-sceptics.

On Black Wednesday in September 1992, the Government only escaped total economic collapse by resorting to a massive devaluation of our currency, a tactic which during my 35 years as a Tory MP was condemned by the Conservatives in office, or out of it, as reprehensible, and at best as a mere shot in the arm, intended to improve the terms of trade by cheapening our exports; but which in the long term would lead to inflation.

The fact that this latter has not yet happened is because domestic consumer demand has not been as high as one would normally have expected because of the high level of unemployment we have endured until very recently.

So far, well and good; but if we exercise our undeniable right to opt out of the euro, as John Major has declared, "right up to the 11th hour of the final month", when we have to make up our minds, we are living in cloud-cuckoo-land.

For faced with that prospect, the countries joining the euro are never thereafter going to allow us to enjoy the present favourable trading arrangements with them by allowing us to maintain, let alone increase, our competitive position, by indulging in large budget deficits and resorting to further unilateral devaluations when the going gets rough.

Sir FREDERIC BENNETT

Aberangell, Powys

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