EMU Gets Ready to Fly
Pardon us, please. We need one last round of old puns about Europe's looming 1999 monetary union (EMU) and its year 2002 currency (the euro).
Today, monetary union looks far less like a flightless bird (the ornithological emu) and much more like an EMU (an electromagnetic unit) attracting adherents.
Magnetism is, in fact, an apt metaphor. As the Jan. 1, 1999, launch date for EMU approaches, both its future core member states and global businesses have gotten more serious about preparing to benefit. And seriousness has bred more seriousness: Greater mass, more magnetic units.
That pull has gradually affected British Prime Minister Tony Blair's Cabinet leaders. They now seem to be firming up plans to announce this fall that the UK, pending a popular referendum, will join the club in time for its new euro coinage in 2002.
Will Britons vote yea when asked? Controversy over joining all those non-British people across the channel (and trading shillings for euros, not to mention jilting the Little Old Lady of Threadneedle Street!) has not vanished entirely. But momentum has a way of influencing public perception. And business enthusiasm, plus the suasion of a still very popular prime minister, may tug much of the fence-sitting public along.
The same may be said of citizens in Germany, France, Italy, etc. And neither Britons nor British business will have to forsake old ties and trade with the US and Commonwealth nations because of carrying euros and using the chunnel.
Tony Blair will have a high visibility pulpit next year as he assumes the rotating presidency of Europe. Once he casts his lot for the project, he will likely be a sturdy advocate - if only to offset London's delay in joining (probably until nearer 2002).
As financial analysts point out, that delay will give the UK time to get its economy, interest rates, and currency more closely aligned with those of the core continental nations. That's dull but vital stuff. Rather like getting all squads in a platoon to march in step before they close ranks. Miss and they collide, in this case into high borrowing costs and job loss, or inflation.
The rest of the world is paying only vague attention to Europe's long one-step-forward-half-a-step-back process of uniting. But it's coming closer. And it looks more like turning out well. That will certainly be so, in historic terms, if it accomplishes three major ends: (1) Yielding the economic benefits of an undivided $8 trillion market. (2) Providing a large, prosperous common tent within which more regional pride (Scotland, Northern Italy, Ulster, Spain's Basque provinces, Walloon Belgium) can thrive with less tension. (3) Nudging its members to put their welfare states on a sound diet, while coordinating their economic cycles through a single central bank.
As historians of the United States know, the process of forming a more perfect union is seldom easy, until it's done.