To be antieuro, the PM has implied, is to be anti-Europe. But as Blair’s own Labour government is forced to consider calling a referendum on adopting the euro, his party is betraying its own ambivalence toward the currency.
A group calling itself Labour Against the Euro, which includes 34 of the party’s 410 members of Parliament, last month launched a campaign against holding a referendum. The group warned that any attempt to take Britain into the euro zone during the current Parliament, which could run until 2006, would split Labour and divert the government from its primary goal: improving public services.
“I’m not a ‘never’ person, but I think the economics of the situation are all wrong at the moment,” says Ian Davidson, the Scottish MP who is leading the campaign.
Davidson contends that it would be “economic madness” for Britain to consider adopting the new currency at anywhere near today’s high level of the pound against the euro. Davidson, along with many U.K. industrialists, maintains that sterling is in fact significantly overvalued, hurting British exports. He also asserts that joining the euro zone would clash with the government’s domestic spending agenda, because euro members are required to meet the low-deficit rules of Europe’s Stability Pact.
Blair and Chancellor of the Exchequer Gordon Brown have declined to comment on Labour’s euroskeptics, but that in itself may be telling. Brown has promised an assessment of whether euro entry would be good for British jobs and investment by June 2003. If he and Blair really want to call a referendum and have any chance of winning it, they’ll have to begin turning around public opinion by late this year.
