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Why is David Cameron so keen to talk about the possible collapse of the euro? Two theories

Why is David Cameron so keen to talk about the possible collapse of the euro? Two theories

Strange as this might sound, the most interesting thing about Downing Street’s decision to hold a meeting this morning on the prospect of a Greek euro exit has nothing to do with the meeting itself.

As it happens, we’ve known for years that the Treasury and Bank of England have contingency plans in place in case the euro breaks up, or one of its members leaves. Those plans were first forged in 2011 and 2012, when it really did look as if Greece was on the brink of leaving the single currency. They were dusted off again when Syriza won the election last month.

Meetings such as the one this morning are more frequent than you might assume: there are always economic risks facing the UK economy. There were detailed contingency plans in place around the eventuality of a Scottish yes vote in last year’s referendum, for instance.

No — what’s far more interesting than the topic of the meeting is the fact that Downing Street has been so keen to advertise it. This morning it briefed lobby journalists in some detail about the meeting. David Cameron even tweeted about it.

There is clearly a party line being toed here. Every time Mr Cameron or George Osborne has been asked about the Greek elections they have painted it straightforwardly as a big source of risks for the UK economy. Yes, doubtless this is one of the implications. However, it is hardly the only one.

Other politicians around Europe have painted it as an important moment for democracy, an opportunity to address the continent’s problems, a breath of fresh air or — closer to Berlin — a sign that Greeks simply don’t get it yet. Few have been quite as parochial in their response as the UK.

So why is Britain reacting in this way? There are two possible explanations, one intriguing, the other depressing.

The intriguing possibility is that Britain is playing an important diplomatic role in the drama. No eurozone leader would publicly say they are countenancing the break-up of the single currency — but, if they’d like the negotiations to conclude sooner rather than later, it may well be useful to have others dangle that prospect around. Might these comments (designed to unsettle) be intended to chivvy the Germans and Greeks to sort out their differences quickly?

The depressing explanation comes back down to the UK elections, approaching in May. The centrepiece of David Cameron’s pitch to the voters is that the Conservative party has a “long term economic plan” (and, by elimination, that no-one else does). On that basis, it rather reinforces the Prime Minister’s pitch if he is very publicly seen as preparing that plan — whether it’s for UK growth or for the response to another euro crisis.

If the explanation is indeed the latter one, it does rather raise the question of whether the PM and Chancellor are behaving responsibly. There was a market sell-off following news of today’s meeting. Such noises worry people.

I have no idea whether the best explanation is the intriguing one or the depressing one, or a bit of both. But it does feel as if something is going on here.

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