European Union (Approval of Treaty Amendment Decision) Bill [Lords]

Neil Carmichael Excerpts

Monday 10th September 2012 Commons Chamber

[Mr Baron]

That is up to the Greek people. Unlike many initiatives relating to the eurozone crisis, one is not trying to replace the democracy that exists in Greece, although if we look at what has happened in Italy and, it could be argued, to a certain extent in Greece, we see that it is very much the bureaucrats who are in charge. However, ultimately Greece will have to make a decision; it cannot have it both ways. We have seen the high social cost of Greece remaining a member of the euro, and it is very saddening, with the suicide rate going through the roof and the economy collapsing. Perhaps someone needs to explain to Greece that a course of devaluation would do its economy a power of good.

[Neil Carmichael (Stroud) (Con)]

I want to develop that point, because it seems to me that Greece has effectively decided to stay in the euro—the Government are committed to that—so exactly what business do we have trying to tell the Greeks how to run their economy, especially since we are not in the euro?

[Mr Baron]

One is not trying to tell them how to run their economy at all. I am afraid that my hon. Friend was obviously not listening. What one is suggesting is that the experience of past cases illustrates the merits of devaluation. Since the second world war there have been about 40 occasions when currency blocs have broken up, and in the vast majority of cases—I struggle to think of an exception—the countries that left currency blocs benefited. Their growth rates picked up because they became more competitive, their currencies devalued and, most importantly, their peoples benefited. If my hon. Friend can think of one exception to that general rule, I would be delighted to hear it, because I cannot think of one. In summary, I believe—

[Neil Carmichael]

rose—

[Mr Baron]

If my hon. Friend does not mind, I am about to finish. Interruption.] All right, I will give way, if he can think of an exception.

[Neil Carmichael]

I was casting my mind back to 1967, when the Labour Government devalued the currency, but can see no evidence at all that the decision brought about any improvement. In fact, it was followed by the creation of the Department of Employment and Productivity, and by 1970 that was an unmitigated disaster.

[Mr Baron]

rose—