Wednesday, William Hague, the UK Foreign Secretary commented that the euro is “a burning building with no exits” for several countries which took on the currency. Mr. Hague used the same expression in 1998 as leader of the Tory party and commented that he was proved right.
The Financial Transactions Tax
This news comes as the EU has presented a financial transactions tax, which the UK has rejected, in order to maintain Greece as a member of the euro and confront its debt issues. The eurozone continues to struggle as the sovereign debt crisis continues, which Mr. Hague believes is the result of the single currency created for the EU.
Mr. Hague previously ran a campaign to preserve the UK’s currency called “Keep the Pound” when he was the party leader for the Conservative party. “It was folly to create this system. It will be written about for centuries as a king of historical monument to collective folly. But it’s there and we have to deal with it,” he has said. He stood by that previous description of the euro, saying it has proven to be that way for several of the countries who had adopted it, maintaining that it was difficult to leave the euro—hence the “no exits” comment.
Too Much EU Power
According to the UK Foreign Secretary, the EU has too much power and a group has formed to re-evaluate the UK’s relationship to the EU. The UK has rejected the ideas of economic integration, which no doubt will continue as the euro begins to fail, and Mr. Hague believes that some powers should be returned to the UK. However, he also said that any proposals from the UK would need to be discussed with the other party in the coalition.
City of London officials have argued that around 80% of any revenues from the proposed financial transactions tax would come from London should it be accepted, which would hurt Britain’s largest industry, including insurance and fund management. According to Eursceptic Conservative MEP Daniel Hanann, “The problem was too much debt and the EU is trying to solve the problem with more debt, pushing new liabilities onto countries that couldn’t meet their existing liabilities.”