It can be hard to weigh up the almost daily panics and rallies in the eurozone but things are extremely grim. In his column this morning, Allister Heath – Editor of City A.M. – writes that there “will be no sustainable solution to the Eurozone crisis without either a break-up or a dramatic acceleration in integration.” Even when there are rallies, they are just the result of “desperate, short-termist bailout junkies” hoping for “more QE or taxpayers’ cash to bail out Spanish banks.”
Leaders in the eurozone need to work out how to resolve the crisis. Unfortunately they will be very resistant to the radical action needed under the most economically realistic plans, like those set out by Neil Record. But the critical thing for Britain to do is to ensure our economy is as well prepared as possible for any trouble and that our banks know all they’ll get is cold turkey, we can’t afford our own bailout junkies.
The 2020 Tax Commission sets out a plan for the major reforms our economy needs so it can grow more strongly and make the best of whatever conditions the international economy throws at it.
But there is also the more direct issue of how to protect taxpayers from new bailouts if the banks get in trouble again. Last month Andrew Lilico, a Director and Principal of Europe Economics, wrote about an alternative so we can protect taxpayers from new bailouts. He set out a six point plan, which I’ve contracted here but you can read in full at ConservativeHome:
We need to end the bailout culture. It produces terrible economic and political results and is impossible to justify to taxpayers struggling enough with the economic fallout from the ongoing financial crisis. There is a clear and credible plan for how that can be done, very similar to what both the British and European authorities themselves acknowledge is needed in the long run. The Government will have no excuse for bailing out the banks if the crisis worsens again.