A decade or so ago, when we were all very exercised about the euro, there were two kinds of people who were against it. One was nationalist head-bangers; the other was the people - including Liberals - who were afraid that fluctuating exchange rates played an important role.
I was in the second category (definitely not the first), and felt somewhat alone in the Lib Dems.
Those in favour of the euro at the time, though otherwise charming and sane, took on a kind of Napoleonic certainty when it came to discussing currencies. Which is a way of saying that they didn't engage much with the exchange rate argument.
There seemed to me to be a danger that one interest rate could not possibly suit the whole of Western Europe. It was bound to suit the cities at the heart of Europe, but prevent those peripheral places and nations from devaluing when they needed to. It would trap those poorer cities and nations in a currency which was too valuable to suit them, and would usher in fierce populist right-wingers in their devastated cities.
Unfortunately, that is what seems to be happening - and, sure enough, in the outlying nations like Portugal and Ireland. Before the euro, Ireland could devalue and balance their economy by doing so. Now they have to cling to the mast, cut everything in sight and hope - like Phineas Fogg, chopping up the train to feed the fire that drove it - that there will be something left at the end.
That is an illiberal disaster and it should not have happened. None of which suggests that the euro should be abolished. We need more international currencies. But we can't survive without other currencies that serve our needs alongside them.
There is still a Napoleonic tendency that doesn't really believe in economics. I'm hoping maybe, maybe, if I approach them very delicately, we might have a rethink on the euro...
Roy Goodman on Allegri's Miserere
4 hours ago