Larry Elliott's apocalyptic reconstruction of what would have happened if Britain had joined the euro (3 June) is so fanciful and prejudicial that it merits a response. All his assumptions are questionable. It is quite possible that Britain could have negotiated an acceptably low entry rate for sterling as the price for UK membership, which most other member states wanted. As a eurozone member, Britain could have had a strong influence on monetary and fiscal policy, both in the eurozone ministerial group and at the ECB. As it was, Gordon Brown, to his frustration, was excluded from the former and the governor of the Bank of England was not a member of the inner ECB governing council.
Although interest rates and monetary policy would have been determined by the ECB, it is false to assume that it would have been exactly the same in the lead up to 2007, or that our domestic fiscal policy would not have taken a different and offsetting course. It is also absurd to claim that, deprived of the alleged safety net of devaluation, Britain would have landed in the same boat as Spain, Greece, Ireland and Portugal after the 2007-08 crash. Mr Elliott omits to point out that our precious safety valve of an unparallelled trade-weighted depreciation of well over 20% in sterling seems to have done little for our exports, manufacturing sector or economy more generally. This is not to claim that all would have been roses if we had joined the euro. But there is at least a sporting chance that, with our participation, the eurozone would have been better equipped to face the 2007-08 crisis, and Mr Elliott does no service to the current European debate by presenting such a one-sided analysis.
Brian Unwin
Dorking, Surrey
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