Will the Finns be first to jump?
http://www.telegraph.co.uk/finance/c...ving-euro.html
Euro disintegration spreads
German eurosceptics quietly hope that Finland will become the first creditor state to storm out of monetary union in disgust, opening the way for others to break free.
Quote:
Originally Posted by Telegraph
Once Finns break the taboo, it would be easier for Germany to extricate itself from an escalating national disaster without inviting opprobrium from across Europe, or so goes the argument. “We can’t start this off, but the Finns can,” said Hans-Olaf Henkel, former head of Germany’s industry federation. Berlin’s policy elites are constrained by their honourable - if misdirected - feelings of moral duty towards the euro. They cannot bring themselves to plunge the dagger.
Or as ex-Bundesbanker Thilo Sarrazin puts it, they are driven by “the very German reflex that the Holocaust and Second World War will only be atoned for finally when all our interests, including our money, are in Europe's hands". Finnish exit - or FIXIT, as they say in Helsinki - is certainly a plausible hypothesis. The Finns have no ensnaring duty to a mystical “Europe“. They did not join the EU until 1995, and only then with widespread dissent.
“Sweden and Denmark both held referendums on the euro, and both said no. We were never allowed to vote,” said Timo Soini, leader of the True Finns party. That was a mistake. The nation is not locked into ritual assent. Finns obeyed the rules of EU membership with scrupulous care, while others gamed the system. “Our Lutheran morality, if you will,” said foreign minister Erkki Tuomioja.
They alone faced the fiscal implications of EMU for small economies out of cyclical alignment. Finland’s budget surplus was 5.3pc of GDP at the top of the boom in 2007. Greece’s was 6.5pc in deficit. There lies the full horror of what has happened. “In Finland, a handshake is final. We thought we had a deal that every country would look after its own finances, only to find the deal was broken,” said Alexander Stubb, Finland’s Europe minister.
The Finns survived their own gruelling depression without foreign help in the early 1990s when the Soviet Union collapsed and exposed the fragility of the Finnish banking system. The economy shrank by 13pc. “We had the IMF knocking at our back-door. Unemployment was at 18pc. We said 'never again’ and yet here we are in a fresh crisis because of somebody else’s fault,” said Mr Stubb. For the True Finns - with 19pc of the vote in the last election - it is an outrage. “We bailed out our own banks, and now after all the lying, dishonesty and malfeasance in Europe, we are being asked to bail out their banks. This is the last straw,” said Mr Soini.
There is no doubt that Finland could go it alone.
The southern countries in the Eurozone are completely broke as it is, as is the ECB with the trillion-Euro loans it provided to them back in the winter - loans which have to be paid back in a period of three years time, something that won't be happening as they can't even pay back the debts they have now let alone those made by the ECB.
But what we're seeing here is the disintegration of the Euro and the EU at the heart of 'the project' - with the Germans (apart from the French) being the historically most pro-EU starting to question the entire currency project as examined here http://www.eureferendum.com/blogview.aspx?blogno=83060. The drama could continue on for a few years, but I think in the next few months we'll see the Euro end - if it manages to keep going into next summer i'll be mildly surprised, put it that way.
Thoughts?
