Rather than the Euro collapsing because Germany and the other Frugal Nations will not prop up for the foreseeable future the failed economies and politically weak states of Italy, Spain, Portugal, and now increasingly France – they will not sign up to ‘More Europe’ with EuroBonds and Euro-wide taxation – we may well see Germany, Austria, Finland, The Netherlands and The Baltics leaving the Eurozone and creating the ‘Hanse’ as a new currency.
Not after all an Italexit from the Eurozone followed by other southern Euro-states but a Norexit of the economically viable states. The latter process would cause far less global financial disruption than the former.
Those left behind in the shrunken Eurozone with a hugely devalued Euro might even see an economic bounce as they begin to escape the Euro Tragedy – one reinforced if they can some day also sort out their education and legal systems so as to foster innovation and give hope to their young so cruelly deprived of jobs.
Whether the EU could survive such a splintering of the Eurozone having for two decades tried to make work an economically irrational and reckless pet political project is unlikely – one variously labelled ‘More Europe’, ‘The Project’, ‘Greater Integration’.
The UK would be well out of the turmoil thanks to the wisdom of Brexit – and will enjoy strong trading links with the ‘New Hanse’ collective of like-minded nations. But will probably not want to give up the Pound so as to adopt the Hanse.
Of course, predicting the future is usually a futile exercise so maybe it will be just a matter of watching the EuroFarce muddle on for another decade or two, condemning the southern Euro-states to continuing strangulation at the hands of the ECB and of Brussels panjandrums unable to admit that the Euro Project has been an utter disaster.
David Palfreyman, OBE, is Bursar and Fellow of New College, Oxford.