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The Euro Monster as Contrived by British Lord Cockfield

In most European countries, the banking system was subject to strict regulatory control, similar to a Glass Steagall standard, prior to the 1980s. However, that was to change after Margaret Thatcher came to power in Great Britain and François Mitterrand in France, both of whom played a major role in intimidating a united Germany into accepting the supranational Maastricht Treaty and the euro.

In Great-Britain, the "Iron Lady" introduced her Thatcherite economics of deregulation and privatization, which eventually led to the deregulation of the London Stock Exchange, known as the "Big Bang" of 1986. In France, it was Mitterrand’s protégé, then Finance Minister Jacques Delors, who, in January 1984, rammed through the banking "modernization" law abrogating the French law of December 2, 1945, that separated deposit banks from investment banks.

When Delors become President of the European Commission shortly afterward, he teamed up with one Francis Arthur Lord Cockfield (1916-2007), a member of the Queens Privy Council and a British Tory civil servant who, after serving as Minister of State at the Treasury under Margaret Thatcher (1979-1982) ended up as a vice-president of the EU Commission, in charge of the internal market, tax laws and customs.

But rather than defending the "eurosceptism" of a Thatcher, Cockfield became the driving force for the creation of the Single European Market and all the ensuing European treaties from Maastricht to Lisbon. In addition to the internal market portfolio, Delors delegated to Cockfield power over crucial financial institutions and company taxation, the customs union and indirect taxation.This put Cockfeild into a key position for formulating the single market reforms.

Most of Delors' “great contributions to the construction of Europe” were in reality concocted by Cockfield personally. Among them: 1) June 14, 1985, a white paper called “1992”, laying out a precise calendar for creation of the single market; 2) The Single European Act (SEA), the first major revision of the 1957 Treaty of Rome which set the objective of establishing a Single Market by December 31, 1992. The SEA, of which Delors is so proud, was signed in February 1986 and went into effect in July 1987 under the Delors Commission; 3) The Delors report, presented and accepted at the European Council defining the Economic and Monetary Union (EMU); and last but not least, 4) the Maastricht treaty.

For such a prominent role, Lord Cockfield is called the “father of Maastricht”. He was influential in the decision to set out a December 31, 1992 deadline for the completion of the market, and can also be credited with persuading Delors to adopt the high-risk strategy of framing a full single-market program in advance, rather than allowing it to emerge piecemeal.

After the Maastricht Treaty, it was inevitable that Italy and Germany would have to fall in line. In Italy, it was Mario Draghi who, as director general of the Treasury Minister in 1998, was the architect of the bill repealing the "Banking Act of 1936", i.e. the Italian equivalent to Glass Steagall. Draghi was well rewarded for his acts: he became Vice Chairman of Goldman Sachs and is currently Governor of the Bank of Italy and chairman of the Financial Stability Board.

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