Now Ireland and Greece have to bail out Portugal. Britain must refuse to join this madness.

Imagine you were a Greek taxpayer. No, alright, bad example: lots of Greeks avoid tax, which is one of the reasons they are in their present mess. Imagine, then, that you were an Irish taxpayer. You would, I put it to you, be feeling pretty miffed this morning.

First your economy was ruined by the euro: a monetary policy designed for Mitteleuropa meant real interest rates of minus one per cent during the boom between 1998 and 2007. Then you had to watch your main trading partner, the United Kingdom, enjoy a 20 per cent competitive devaluation, while you suffered the devaluation in output and jobs (Irish GDP is down by an almost unbelievable 20 per cent from peak). Then Brussels assumed control of your economy, and started demanding that you to raise your corporation tax. Now you learn that your government is obliged to send hundreds of millions of euros to Portugal, so that the Portuguese can suffer what you are suffering.

Can we please stop referring to what is happening as “assisting Portugal”? I’m enormously and sentimentally Lusophile, and if I thought that a loan would help, I’d be all for it. No alliance on the planet has endured as has the 700-year league between England and Portugal. The Portuguese defied Bonaparte in the name of our friendship, and even entered the First World War for our sake. They joined EFTA when we did, and followed us (ruinously, it now turns out) into the EU.

Yet it cannot be stressed too strongly that the Portuguese did not want this bailout. They resisted the pressure from Frankfurt and Brussels for as long as they could. They know perfectly well what ceding control of their economy means: the loans will end up in the pockets of European bankers and bondholders, the repayment will come from Portuguese taxpayers. The EU isn’t rescuing Portugal; Portugal is being sacrificed to rescue the euro.

Ponder the absurdity of the situation in which the EU’s currency union finds itself. The Irish and Portuguese governments have had to loan money to each other as well as to Greece. The EU, meanwhile, demands that its already mortgaged member states find yet more money in direct revenue for Brussels. Debt is piled upon debt. Oh, and having wrecked the peripheral economies with low interest rates, the ECB yesterday raised rates, just in time to catch their repayment.

Britain, which stayed out of the whole mess, is being asked to do something costly, detrimental to a friend and – most important – utterly illegal. We should refuse.

If the euro zone member states want to use the fund they have set up among themselves, so be it. It strikes me as idiocy – better by far to let Portugal leave the euro and price its way back to growth – but idiocy is the prerogative of any democratic state. What is utterly unacceptable is to expect Britain to make any contribution beyond the small liability we carry as a member of the IMF. We kept the pound. This isn’t our problem.

 http://blogs.telegraph.co.uk/news/danielhannan/100082966/now-ireland-and-greece-have-to-bail-out-portugal-britain-must-refuse-to-join-this-madness/