Britain Should Adopt the Euro


Many Americans have a hard time understanding the European Union (EU), because countries that do not use the Euro currency are nevertheless allowed to be EU members. They cannot relate, since every U.S. state is required to use the Dollar, with no option.

The Euro, which was introduced in 2002, is presently the official currency in only 17 of 27 EU nations.  Seven countries, who enlisted in the EU in 2004 and 2007, will convert between 2012 and 2014 under timetables adopted at the time of admission. Three small non-EU tax havens also use it: Monaco, and San Marino and Andorra. But three EU states have opt-out, including: Britain (Pound Sterling), Denmark (krone), and Sweden (krona).

Since the recent economic crisis, it is unlikely the UK will replace the Pound with the Euro in the immediate future. Although the Euro would make foreign trade easier, and the failure to adopt it will adversely affect international investment, jobs, and economic prosperity, 66% in Britain have opposed a monetary conversion, because they fear a decline in national sovereignty and a loss of control over their economy. They worry a transfer of power from the Bank of England in London to the European Central Bank would give Frankfurt the ability to control interest rates, inflation, and unemployment. For these political and economic reasons, the UK decided not to adopt the Euro and continued using the Pound.

The question now is whether Britain’s refusal to join the monetary union will harm the EU? In the event of an EU recovery, will the UK start to become irrelevant? Since the Euro was a major success in terms of European unification during its first ten years, my guess is the new currency will survive the current crisis and the EU will emerge even stronger. Old England may in the long run be held down by the weight of their own Pound. In regional circles over time, the English currency will start to be viewed as funny money, since Europeans will be using the Euro. If Britain does not officially convert, their people may start to do so in the ordinary course of business, as a matter of fact, and inevitably the Pound may be lost anyway. Just when most think the adoption of the Euro would be the wrong move, some intelligent future British Prime Minister should courageously advocate its adoption.

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