Europe United: Part II. The Sensibilities of Saving Sterling
It is a generally accepted principle of rhetoric and reality that the bane of all great democratic political endeavors is the notion that inter-party consensus is essential to accomplish the task. It is also a basic principle among most political parties that it is often wiser to include in their governments or shadow cabinets members who disagree with the party leader on important issues. These notions add complexity to the topic of whether, when, and at what rate Britain should abandon the Pound Sterling in favor of a currency no one has used to buy consumer goods or deposited in a personal bank account. The images of bridges, towers, windows, and gates euro bills will display actually reveal much more about the weak and volatile new currency than the panel that selected those images probably realize. For the euro to be a respected, stable coinage in the mold of the Deutschemark (DM), the European Central Bank (ECB) must prove it can lead euro-zone currencies across the bridge of diverse monetary policies to full convergence. In doing that, it will fling open the gates to public support.
But now the euro drifts hesitantly as the ECB tries to force its monetary ledger to balance. We are told that according to trading criteria, the euro is a monetary unit approximately valued at USD0.84-0.89, but the assertion requires the same level of faith as expected of a gambler who is told by a casino that red chips are worth $5 and yellow chips are worth $50: The chips themselves have no value, but trading them for hard currency gives them tangible value. Fees shown in euros now have only speculative value; converting those fees to DM or pounds or other terms gives them tangible value.
Establishing the euro is a process fraught with fiscal hazards. This process is not something newly created by the Maastricht Treaty. It has been a source of banter among European leaders since the 1960s. And no wonder: Their success to date is a hypothetical currency that for two years has steadily weakened.
The first incarnation of the euro was a rather poorly thought out plan known as the Barre Plan. Named for its sponsor the French finance minister, the Barre Plan sought to create a single European currency by 1980. The Barre Plan cited the Treaty of Rome as its main source of authority, but it did not stipulate how convergence criteria would be applied. After months of debate, the Barre Plan was shelved for later discussion.
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