Robin Hood wrote:TD:In the first place, the UK DOES have its own currency (it's called the pound) and its own independent central bank, and as a member state prior to the introduction of the euro, is not obliged to adopt the latter, so that is a non-issue.
I would not consider the Central Bank (BoE) to be independent. It is part of the banking system and is ‘controlled’ by commercial banking interests not independently owned by the people i.e. government. The pound is also an internationally traded reserve currency which puts it ‘at risk’ to market forces. The Brits do not have control of its value, but of course the same applies to all reserve currencies ..... they can be attacked, which is why control of the system is essential to the Worlds only Super power whose banks dominate the global banking system......... the USA.
If you look at any large land mass it is broken down into smaller parcels and can be called Provinces, Counties, regions etc and each with its own local government. That applies to the US, Russia, China, Europe, Australia etc. and each geo-defined area has its own form of local administration but is applied to matters that are usually related to each individual geographical entity, but internally. When you get a central government that is a layer of administration over several smaller administrations, where collective policies are applied, it has to be considered as Federal, at least in form. One tune .... one conductor?
IMO: I don’t think what they have in the US is healthy as you have some 50 odd smaller administrations but a single seat of international political and military power. They are the political/military equivalent of ‘too-bid-to-fail’ banks, as the smaller entities have insufficient control over what their central government does to affect their international influence/interference. A single or even a few dissenting voices can be squashed by the sheer weight of influences the majority can exert. That now happens on the grand scale ..... one power attempts to overrule all others. Because of this, I believe this should be avoided at all costs in Europe as it is already becoming an extension of the US global sphere of influence and is why I believe Obama came to the UK to carry the message to Cameron that the UK WILL remain in the EU ........... primarily for the benefit of the US.
The problem I see for the UK is that it has an economy which is dominated by banking and financial interests. It is almost a one-horse economy.
I saw this growing in the mid 80’s when, as an engineer I found myself redundant after some 12 years with the same company. Much of my time was spent in Europe on company plants, so I was no novice to working away from home. When I started looking there were very few jobs in the UK in the wealth creating industries, to be had. I had to follow the work to survive, the UK Govt. didn’t help as they would not allow people whose jobs were transitory (say 6-18 months) to get tax relief on travel and subsistence costs of working around the country to obtain work. Unfortunately, Mr. Tebbit’s advice to get on your bike to find a job was OK in theory, but they taxed you on your bike! All the jobs that were available were those in the greatly expanding financial sector and these were not wealth creating .... something Mrs. Thatcher managed to over look. So I reluctantly went abroad to work. I never returned to the UK to work.
The UK economy is now very much dependent of the financial sector for its survival. In spite of comments here to the contrary, things are not all hunky-dory in the global financial and banking system.
The fact that the financial system is based primarily on computer transactions, that happen very quickly and over a global net work, it would not be too difficult, for instance, for the Germans and the French to take that dominance away from the City of London. If this was backed by a major power with whom we supposedly had a ‘special’ relationship, the UK would be finished and simply an historical has been, in all spheres of influence.
The economy in the UK is about as secure as the shell of an egg! The UK has very little industry left and would be unable to even remotely counter an attack on its financial/banking sector. The alternative for the UK is to change how the banking and financial system works and greatly reduce its influence on the real economy. This has been recognised by many politicians ...... even Trump, but that is a taboo subject, not only on the forum but in the international political/diplomatic sphere of influence.
I still believe the UK will stay in the EU even if it means fiddling the result of the referendum ..... but either way, the UK and eventually Europe is in for a very rough few years ..... maybe even globally.
Australia is already greatly under the influence of the US and will follow the US no matter what as a de facto member of the US/NATO alliance. It also has an economy that is greatly dependent on a single source of income. Natural resources, that it sells mainly to China. If the Chinese/Asean economy collapses, this will have a great effect on the Australian economy. Although it is nothing like the degree of dominance the financial/banking system has on the UK economy ........ as the Australians do have other goods to export!
Great post I liked it.
Now about the future of the EU everybody seems to ignore the new rising giants, Poland and Romania.There's a good chance they will dominate after 20 years as most factories and heavy industries move there (mainly to Poland).
Perhaps Paphitis who admires UK's financial system could explain us what of essence that system is actually delivering. Thin air maybe?
I must admit the same system worked fine in Cyprus for about 2 decades. We all became rich, and thought we were clever...
