Leading article: A voice of euro-fatalism that must be challenged

Share
Related Topics

Just when the European Union might have welcomed a fortnight's breathing space, between the Yes vote in Ireland and the Greek election on 17 June, up pops George Soros, billionaire philanthropist and all-purpose financial guru, to throw his venerable spanner in the works. At a conference in Italy, Mr Soros warned that there was but a three-month window to save the euro.

To describe his intervention as ill-timed would be an understatement. It was worse than ill-timed, it was irresponsible. European leaders need no reminding about the scale of the crisis they are confronting, and they especially do not need a deadline set by a speculator. They need time and they need space to examine the options. That is what Mr Soros will have stolen, if they – and/or the markets – choose to heed him. We hope they do not.

To ignore or contradict Mr Soros is a risk not to be taken lightly. Ever since 1992, when he bet against the UK remaining in the European Exchange Rate Mechanism, and won, his words and his financial manoeuvrings have assumed a legendary status. And the difficulty is that, whether his soothsaying is accurate or not, his clout gives him the capacity to move markets. His prophecies become self-fulfilling. When he issued a similarly doom-laden warning at Davos in January – but without the deadline – the euro immediately fell.

The danger now is that politicians and markets respond to the bleak musings of Mr Soros rather than to some of the more positive developments of recent weeks. There have been changes since Mr Soros spoke in January, and not all of them have been for the worse.

The first is Ireland's referendum result. To imagine what different territory the eurozone could now be in, one has only to posit a No vote in Ireland. The 60 per cent Yes might not have been an overwhelming vote of confidence, but it was a convincing statement to the effect that Ireland felt more secure as part of a common European endeavour than not. As such, the vote reflected hope for Europe rather than despair. European leaders, whether inside or outside the euro, can take heart from that.

A second is the change of mood in Europe since the election of François Hollande as President of France. It is often argued that, given all the constraints of the modern world, a change of national leader can alter little. Mr Hollande is the latest in a stream of examples that give the lie to this particular brand of cynicism. With Mr Hollande's arrival on the European scene, the balance between austerity and growth has shifted. While never the straight alternatives much rhetoric suggested, the search is now on for ways of encouraging growth within existing economic limitations. Progress in this direction might just facilitate the election of a viable government in Greece.

And a third is a hint of greater flexibility from Germany. For her own political reasons, Chancellor Merkel cannot afford to execute a sharp turn in economic policy. Her party has, however, come in for a battering in regional elections, and the forecasts – here Mr Soros is right – are for an economic slowdown, even as the country enters a federal election year. Ireland gave Germany the endorsement of the European fiscal stability treaty it needed; with that battle won, perhaps talking can begin.

The bank troubles in Spain and the prospect of Cyprus joining the queue for a bailout must be included in the equation. But one financier, even George Soros, should not be left to dictate the fate of the eurozone unchallenged.

React Now

Latest stories from i100
iJobs Job Widget
iJobs General

Guru Careers: C# Project Team Lead

£55 - 65k (DOE): Guru Careers: A unique opportunity for a permanent C# Develop...

Guru Careers: Graduate Editor / Editorial Assistant

£16 - 20k: Guru Careers: A Graduate Editor / Editorial Assistant is needed to ...

Guru Careers: Software Developer / C# Developer

£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...

Guru Careers: Software Developer

£35 - 40k + Benefits: Guru Careers: We are seeking a Software Developer (JavaS...

Day In a Page

Read Next
The Irish referendum was the first on the issue of same-sex marriage anywhere in the world  

Don't be blinded by the Yes vote: Ireland is still oppressing its LGBT population

Siobhan Fenton
 

Daily catch-up: union bosses mobilise to try to prevent a Labour government

John Rentoul
Abuse - and the hell that came afterwards

Abuse - and the hell that follows

James Rhodes on the extraordinary legal battle to publish his memoir
Why we need a 'tranquility map' of England, according to campaigners

It's oh so quiet!

The case for a 'tranquility map' of England
'Timeless fashion': It may be a paradox, but the industry loves it

'Timeless fashion'

It may be a paradox, but the industry loves it
If the West needs a bridge to the 'moderates' inside Isis, maybe we could have done with Osama bin Laden staying alive after all

Could have done with Osama bin Laden staying alive?

Robert Fisk on the Fountainheads of World Evil in 2011 - and 2015
New exhibition celebrates the evolution of swimwear

Evolution of swimwear

From bathing dresses in the twenties to modern bikinis
Sun, sex and an anthropological study: One British academic's summer of hell in Magaluf

Sun, sex and an anthropological study

One academic’s summer of hell in Magaluf
From Shakespeare to Rising Damp... to Vicious

Frances de la Tour's 50-year triumph

'Rising Damp' brought De la Tour such recognition that she could be forgiven if she'd never been able to move on. But at 70, she continues to flourish - and to beguile
'That Whitsun, I was late getting away...'

Ian McMillan on the Whitsun Weddings

This weekend is Whitsun, and while the festival may no longer resonate, Larkin's best-loved poem, lives on - along with the train journey at the heart of it
Kathryn Williams explores the works and influences of Sylvia Plath in a new light

Songs from the bell jar

Kathryn Williams explores the works and influences of Sylvia Plath
How one man's day in high heels showed him that Cannes must change its 'no flats' policy

One man's day in high heels

...showed him that Cannes must change its 'flats' policy
Is a quiet crusade to reform executive pay bearing fruit?

Is a quiet crusade to reform executive pay bearing fruit?

Dominic Rossi of Fidelity says his pressure on business to control rewards is working. But why aren’t other fund managers helping?
The King David Hotel gives precious work to Palestinians - unless peace talks are on

King David Hotel: Palestinians not included

The King David is special to Jerusalem. Nick Kochan checked in and discovered it has some special arrangements, too
More people moving from Australia to New Zealand than in the other direction for first time in 24 years

End of the Aussie brain drain

More people moving from Australia to New Zealand than in the other direction for first time in 24 years
Meditation is touted as a cure for mental instability but can it actually be bad for you?

Can meditation be bad for you?

Researching a mass murder, Dr Miguel Farias discovered that, far from bringing inner peace, meditation can leave devotees in pieces
Eurovision 2015: Australians will be cheering on their first-ever entrant this Saturday

Australia's first-ever Eurovision entrant

Australia, a nation of kitsch-worshippers, has always loved the Eurovision Song Contest. Maggie Alderson says it'll fit in fine