Re: Benefits of the Euro
Oh dear, oh dear, oh dear.
Not that I'm disputing all the good points about the Euro. It certainly can make life more convenient. However there are a few (frankly enormous) caveats.
Exchange rates are actually really important. Vitally so. They're the rebalancing mechanism that allows countries who are doing badly in trade terms to recover, relatively painlessly. Sure the drop in sterling costs every UK person money, but only on the component of prices that relates to imports. This also makes exports more competitve. Giving both a way to earn more foreign currency, and an incentive to substitue imports for locally produced goods. When a certain amount of that happens then the UK consumers' demand for foreign currency will drop, demand for sterling will rise (as more exports are being sold to foreigners who need pounds to pay for them) and so sterling will recover. Thus currency is acting as both a buffer to cushion the effect of economic shocks - and a push towards equilibrium, as unsustainable levels of exports or imports will be corrected by natural currency movements.
The alternative to this if your economy has become uncompetitive is wage cuts. But employees don't like wage cuts. In the Great Depression in the US, which started in 1929 - wages didn't seriously drop until 1932-33. Unemployment rose massively, but those in work were still unwilling to take cuts, even if there were no rises on offer.
The Eurozone does not have the natural balancing mechanism of currency movement. However the architects of the Euro knew that there was an alternative. What other monetary unions (say the UK and US do) - which is large transfers between regions of government money. Wealthier regions are taxed more, and that cash goes to the poorer ones, and helps to cushion asymetric shocks - where currency movement can't take the strain within a single currency area. This is the theory of optimum currency areas. The US Federal budget is something like 20% of GDP - or government spending per head in Scotland is something like 20% higher than it is in England.
However the EU budget is only 1% of GDP, and although a chunk of this is structural/regional spending to help the poorer regions of the EU - a third of it is still spent on agricultural subsidies - mostly to the richer bits of the EU.
In order to make the Eurozone work, the Commission budget would need to be at least 10x higher than it currently is (probably 15x-20x), and much of it be spent in the poorer bits that pay less tax.
At the moment there are none of the tools to currect the current Eurozone imbalances, which is why Greece has actually suffered worse than Germany and the USA did in the Great Depression of the 1930s.
Your comments on Greece are a sick joke. And only ignorance makes them forgiveable. The Euro has been an even bigger disaster for the Greek economy than the Greek government - which is saying something! And the response from the Eurozone has been vindictive, sanctimonous, dishonest, cruel and worst, fucking stupid!
Which is why the IMF prediction is that Greek unemployment will only fall below 10% (from its current 25%) in 2040!!!!
Italy's economy is now smaller than it was when it entered the Euro, even though they've been reasonably prudent, and avoided huge government deficits. Finland has been much better managed, but unable to use their currency buffer when hit by economic shocks, they've been in recession for 8 years. The comparable Swedish economy, which recovered very similarly from the 90s recession is well out of it now, as they weren't foolish enough to join the Euro.
The Euro has been a total disaster. And will continue to be so until it is either unwound or fixed - and by fixed that means common bank stabilisation funds plus common government debt and/or spending.
Oh and Greece didn't have all that generous a pension system before the crash (although too generous for its economy), and on average Greeks worked longer hours than Germans and retired later than them. Despite the lurid headlines in the press. They just weren't as efficient, productive or well governed.