Ten years ago today monetary union for the eurozone was established. Three years later the euro was born. Throughout the currency's gestation and launch, the panjandrums of British politics confidently predicted failure.

“I myself believe that EMU will probably break down before Blair is called on to take a decision whether or not Britain should join,” said Lord Healey, the former Labour Chancellor. The European single currency will fail “economically, politically and socially”, insisted Baroness Thatcher. “As the citizens of Europe wake up to the reality of what their politicians have committed themselves to, Britain should count its lucky stars it is not in the euro,” ventured Lord Lamont of Lerwick.

The elder statesmen did not merely oppose British adoption of the single currency. They depicted monetary union as intrinsically flawed. “A continental ‘one-size' bank rate as now imposed on Euroland... simply does not fit the varying needs of stimulus and restraint in so diverse an area,” declared the late Lord Shore, the former Labour Trade Secretary.

It is time for a reckoning. There have been economic stresses and political controversies in the eurozone, but the euro has plainly been a success. It now outstrips the dollar in the value of notes in circulation. It has established itself as the alternative international reserve currency to the dollar. Countries within the eurozone have survived the financial crisis in much better shape than, say, Iceland or Hungary.

During the euro's first two years, sceptics charged that the currency's supposed weakness against the dollar demonstrated a lack of investor confidence. From 2004, when the euro appreciated, the critics changed script without missing a breath. They now claimed that growth in the eurozone was hampered by excessive currency strength, which penalised exporters.

These incompatible criticisms utterly failed to grasp the significance of the new currency. Fluctuations in the dollar-euro exchange rate were nothing extraordinary, let alone apocalyptic. They reflected divergences in relative growth rates and interest rates. These swings were less disruptive for the euro area - comprising a fifth of the world's output and almost a third of its trade - than they would have been for its member states individually, had national currencies still been in force.

In short, the disdain that British policymakers traditionally reserve for European ventures has been just as traditionally refuted. The euro has worked. It has broadened and deepened European financial markets, reducing the cost of capital for business. It has achieved reserve currency status because investors have confidence in its future stability.

The success of EMU, although unforeseen by much of Britain's political class, does not necessarily mean that we should give up the pound and embrace the euro. But we should. The potential benefits are legion. They include increased trade flows (businesses can be more confident about the value of future sales receipts), greater price transparency (consumers can directly compare prices across countries), and lower transactions costs for consumers and businesses.

Such arguments admittedly make no difference to those who believe that the euro involves an intolerable violation of national sovereignty. But a currency ought not to be an issue of dogma. Any treaty obligation involves giving up something in return for a benefit. The issue of euro membership is whether the benefits outweigh the costs. A useful test is whether the opponents of the euro consider that that calculation has been affected in any way by the greatest financial crisis since the 1930s. They appear to think not. George Osborne, the Shadow Chancellor, complains that advocates of the euro have “seized on economic difficulties for political ends”.

Mr Osborne is wrong. The crisis does shift the balance of the argument. In keeping out of the euro, Britain faces greater costs while the benefits are less clear.

The dramatic fall of sterling against the dollar and the euro provides, in theory, help to British exporters. But the boost to growth will be negligible: the global economy is in recession. And the volatility of sterling - which partly reflects the sharp deterioration in the public finances - has costs to set against this notional benefit. It will cost the Government more to borrow money (international investors require a higher premium to compensate for the risk of holding UK government bonds) and the taxpayer will have to pick up the bill eventually.

The crisis has also underscored the importance of international action to stabilise the economy. There have been co-ordinated interest rate cuts, but decisions on fiscal policy and banking regulation - notably with national guarantees on bank deposits - have been taken unilaterally. That must change. Being part of the eurozone would make it easier, by joining with other countries to get things done that will benefit the UK.

It used to be argued that the greater importance of the financial services sector to the UK economy made euro membership unsuitable for us. Surely no one can now maintain that a common European approach to banking supervision and capital adequacy is a threat. The weaknesses of the UK financial system are glaring and need to be remedied. If the UK were in the euro, then it could advance effective European regulation, while opposing impractical schemes that would simply distort markets.

The idea that the UK economy has characteristics that are distinctive from those of Europe has been undermined. The greater importance of our housing sector is a crippling weakness, not an idiosyncrasy. The peculiarly destructive cycle of

boom and bust in the UK is a product of specific policy errors. Joining the euro will not work miracles, but it would make easier the task of repair.

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