One life. Live it.

Via British taxpayers ordered to bail out euro – Telegraph:

All 27 EU finance ministers have been summoned to Brussels on Sunday to sign up to a “European stabilisation mechanism. Britain will be unable to veto this as it will be put through under the “qualified majority voting” system.

And the mandate for a Labour Chancellor to sign up to this is what?

Interested readers may wish to see The Cobden Centre’s posts on Greece and my serialisation of The Theory of Money and Credit (start at the bottom of the page). Also my precis of Huerta de Soto’s explanation of the fundamental problem.

Update: you may enjoy my other economics posts and in particular Eamonn Butler’s Mises Primer published by the IEA with a foreword by yours truly.

Via the Guardian: Alistair Darling rules out British support for euro

Via Britain’s bankers plumb new depths – Times Online :

Jon Moulton, the private equity chief, warned a City lunch this week that he feared serious civil unrest. There was, he said, a 25 per cent chance of one of the 15 member countries of the eurozone pulling out of the currency club. That, he said, would be a catastrophic shock leading to a “far greater financial crisis” than the current one.

But thinking is established in this area: we are not without explanations and options. See for example Denationalisation of Money — The Argument Refined, by F A Hayek.

From the cover page:

Diseases desperate grown,
By desperate appliances are reli’ved,
Or not at all.
– William Shakespeare, Hamlet, Act iv, Scene iii

Hayek makes practical proposals for free trade in money and explains:

The purpose of this scheme is to impose upon existing monetary and financial agencies a very much needed discipline by making it impossible for any of them, or for any length of time, to issue a kind of money substantially less reliable and useful than the money of any other.

He considered the proposal “more practicable than utopian European currency” which

would ultimately only have the effect of more deeply entrenching the source and root of all monetary evil, the government monopoly of the issue and control of money.

And his remarks on monetary policy and a common European currency now look prescient indeed. Consider:

On the effects of the adoption of the proposal all I will add at this point is that it is of course intended to prevent national monetary and financial authorities from doing many things politically impossible to avoid so long as they have the power to do them. These are without exception harmful and against the long-run interest of the country doing them but politically inevitable as a temporary escape from acute difficulties. They include measures by which governments can most easily and quickly remove the causes of discontent of particular groups or sections but bound in the long run to disorganise and ultimately to destroy the market order.

Reason has shown and history has proven that the free market is the only successful system for cooperation in a society based on the division of labour. We must find the courage to fix what intervention has broken.