CITY AND SUBURBAN
Three men in the same boat, without a paddle between them
CHRISTOPHER FILDES
It has been odd to find this election fought out between three parties, each making the same economic assumption, with the same fatal flaw. We are in reces- sion because we are in debt, and Conserva- tives, Labour and Liberal Democrats have not a proposal between them for getting us out of it. They are all three of them stuck with absurdly high interest rates, because they are all three committed to tying the pound to the mark. This, they suppose, makes them good Europeans. The Conser- vatives got there last. Eighteen months ago Margaret Thatcher suddenly popped out of 10 Downing Street to say that we were join- ing the European exchange rate mecha- nism. So she landed my bet that we would join in the week of the Labour conference — but I was sorry to have won. 'All we have to do now', I wrote, 'is to live with the consequences. They will be with us for many years to come, and I fear them. We must try to make our economy fit our exchange rate. Fixed rates are to economic management what Procrustes was to inn- keeping. They stretch or chop the cus- tomers to fit the framework. To rely on the ERM as an external discipline is to say that we either cannot or will not manage our affairs and would rather that others acted for us. They will, of course, act for them- selves.' Of course — for whoever supposed that the Germans would run their policy to suit us? They never offered. They are doing what they think best in a situation as differ- ent from ours as could be, and if we choose to ape them, that is our decision and we must live with it. So we have.
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