Monetary Folly

ONE of George Bush’s first acts on replacing Ronald Reagan in the White House in 1989 was to ring Margaret Thatcher to tell her to stop blocking the European single-currency project, then under discussion by a committee of European central bankers presided over by the High Priest of European integration, Jacques Delors. Four months earlier, in Bruges, the British prime minister had excoriated the Delorsian vision of Europe as the attempt to re-create on a European level the socialist, collectivist, corporatist economy and society that she herself had been beating down in Britain.

In Delors’s own country, France, the failure of the socialist “experiment” in the early years of the Mitterrand government had made it plain that Socialism in One Country was no longer feasible. The increasing ability of international capital to hotfoot it out of any country whose government, unions, and employers’ organizations were conniving in an inadequate rate of return had seen to that. Mitterrand, when he came to power, said that his government would “make a clean break with capital”; instead, capital very nearly made a clean break with France, forcing Delors, who was finance minister at the time, into three franc devaluations in 18 months. Delors concluded first, as suggested above, that a bigger area than France alone would be needed to resist international finance-capitalism; second, that constructing that bigger area would require the support of business interests. Corporatism in One Continent, a/k/a Economic and Monetary Union, was his solution.

BC

About the Author

Bernard Connolly

Featured Tags

European Central Bank

Foreign Policy

ONE of George Bush’s first acts on replacing Ronald Reagan in the White House in 1989 was to ring Margaret Thatcher to tell her to stop blocking the European single-currency project, then under discussion by a committee of European central bankers presided over by the High Priest of European integration, Jacques Delors. Four months earlier, in Bruges, the British prime minister had excoriated the Delorsian vision of Europe as the attempt to re-create on a European level the socialist, collectivist, corporatist economy and society that she herself had been beating down in Britain.

In Delors’s own country, France, the failure of the socialist “experiment” in the early years of the Mitterrand government had made it plain that Socialism in One Country was no longer feasible. The increasing ability of international capital to hotfoot it out of any country whose government, unions, and employers’ organizations were conniving in an inadequate rate of return had seen to that. Mitterrand, when he came to power, said that his government would “make a clean break with capital”; instead, capital very nearly made a clean break with France, forcing Delors, who was finance minister at the time, into three franc devaluations in 18 months. Delors concluded first, as suggested above, that a bigger area than France alone would be needed to resist international finance-capitalism; second, that constructing that bigger area would require the support of business interests. Corporatism in One Continent, a/k/a Economic and Monetary Union, was his solution.