A eurosceptic friend, John Hopkinson, writes on his blog about how conveniently people now support fiscal union for the eurozone and argue who thought of it first.
I have been arguing the opposite for nearly ten years, including in my submission to the Richards Commission.
As someone who supports UK entry to the euro, but only when our interest rates have been stable for a significant period of time at the same rate of the eurozone, and the exchange rate, which would also need to be stable, would result in the value of wages and goods in the UK being the same as the EU, in order to avoid high inflation.
In my view, as a dual Master of Economics and a Master of EU Law those calling for fiscal union don’t know what they are talking about.
If the political elite lack the ability to converge their economies using a single interest rate, how can they be expected to with a single tax regime across the eurozone?
The only way for the eurozone countries economies to converge is for each region of each member state to converge its economies by varying income and business taxes (e.g. business rates, corporation tax), and use the single interest rate as a baseline to set them.
The channel tunnel could not have been built if the French engineers were drilling in a different direction to the British ones. Equally the eurozone won’t be stable if the economies aren’t converged heading in the same direction.