Ken Clarke says no to euro
Kenneth Clarke, former Tory chancellor, has labelled the fledgling European single currency “a failure” and the constitution “effectively dead”.
The apparent sudden change by the self-confessed pro-European has been read as a political gesture to increase his support among Tory eurosceptics, should he put his name forward for the party leadership.
In an interview with a specialist journal, Central Banking, Mr Clarke said the euro had failed to act as a spur to economic reform and higher growth.
“I thought it would lead to increased productivity, efficiency and living standards and stimulate policy reforms. On that front so far it has been a failure,” the 65-year-old said.
“I do not think there has ever been a time when the British could have joined with complete security and confidence. I doubt it is possible for 10 years or more.”
Mr Clarke urged the European Central Bank (ECB) to emulate the successes of the US Federal Reserve and the Bank of England in managing economic growth.
“I think many people would agree that the ECB has to rethink the role it plays in the economic life of the nations it serves,” he said.
“It must stop imitating the Bundesbank [the German central bank], which was an institution suited for the 1960s.”
On the EU treaty, Mr Clarke called on Brussels to rethink the whole project. He described the treaty as effectively dead-in-the-water after voters in France and the Netherlands rejected it in referendums.
“There is no way of rescuing the treaty – although I was in favour – and the sooner we can make a reality of economic reforms in terms that are seen by the public as contributing to their economic wellbeing, the better,” he said.
With respect to the single currency’s effect on Italy’s economy, he said Silvio Berlsusconi’s government was “utterly oblivious” to “reasonable fiscal discipline”.
“It’s still running a kind of family capitalism without paying any heed to the level of wages or other costs.”
The comment is timely as some Italian right wing politicians, including welfare minister, Roberto Maroni, have openly called for the return of the lira.
