Sarkozy Gets Narky

Sarkozy, Merkel and all the great European elite got the euro wrong right from the start. Sarkozy knows it, they all know it as been amply demonstrated by Sarkozy telling Cameron Britain should not attend the summit to discuss the rescue of the European banks. The Chinese are saying that the they want to see systematic and fundamental fiscal and financial reform in Europe and that to achieve this extraordinary political courage and judgement is required. Liam Halligan here in today's Telegraph says he believes that what the Chinese are saying is that the eurozone will ether have to construct a fiscal union or break up the eurozone. Which of the lightweight European leaders will have the guts to break up the euro? None in my estimation, which means they will choose to move towards a fiscal union that is never going to happen. So yet again the EU will choose the worst of all possible worlds. The UK has a golden opportunity to use this debacle to show the leadership and hope the rest of the EU is looking for. Cameron should therefore tell his  EU counterparts that as opinion polls show that most Britons want to continue some relationship with the EU that by seeking to renegotiate our terms of membership now can be used as an excuse for a more fundamental change to the EU structure including the eurozone. Furthermore that Greece will exit the eurozone and that other countries will also be allowed to leave but in an orderly fashion. Since something positive is being done this could well calm the markets and give the EU and eurozone say 6 months in which to renegotiate. To demonstrate that Cameron is serious he will allow a free vote on the referendum issue. Wishful thinking? Probably, but no more so than d'Ancona's rather fanciful article in the Telegraph today here.