Tag: EU

WND column

Democracy and Europe

Two weeks ago, I wrote about the end of Europe’s great experiment with democracy. Not only have countries across the continent been forced into a one-vote, one-time arrangement which bears a striking similarity to the National Socialist plebiscite approach, but now the unelected European Commission is utilizing the financial muscle of the International Monetary Fund and the European Central Bank to remove duly elected officials and install unelected heads of government.

In Greece, Lucas Papademos was sworn in as prime minister last week. He is not a member of Parliament, has never been elected to office and is a former Federal Reserve economist. In Italy, Silvio Berlusconi resigned under pressure and is being replaced by Mario Monti, a former European commissioner and Goldman Sachs adviser. Like Papademos, Monti is an economist who has spent his career in the employment of the international banks and has never been elected to office. He has, however, been appointed to the rather ominous sounding position of senator-for-life. Fortunately, he has yet to make any statements concerning the reliability of the railway schedules.

The fearful foundations of the Fourth Reich

I wrote that a few years ago in a column about TARP. But things are arguably even worse in Europe, where the bankers have forced two non-democratic changes in government in Greece and Italy. But don’t think things can’t go from bad to worse; the normally sane Ambrose Evans-Pritchard is freaked out to the point that he is calling for diplomatic and economic war rather than simply allowing the whole debacle to collapse under its own weight.

In Italy they have already made matters worse. I doubt that much will change with “technocratic governments” in either Greece and Italy, yet immense damage has been done to democratic accountability. The EU Project has become both dangerous and insane….

You cannot allow the biggest bankruptcy in history to run its course – with calamitous domino implications – before all options have been exhausted.

One can only guess what is happening in the great global centres of power, but it would not surprise me if US President Barack Obama and China’s Hu Jintao start to intervene very soon, in unison and with massive diplomatic force. One can imagine joint telephone calls to Chancellor Angela Merkel more or less ordering her country to face up to the implications of the monetary union that Germany itself created and ran (badly).

Yes, this means mobilizing the full-firepower of the ECB – with a pledge to change EU Treaty law and the bank’s mandate – and perhaps some form of quantum leap towards a fiscal and debt union.

In other words, because the EU is an evil financial empire on the verge of collapse, the US and China should intervene, prop it up, and help it transform itself into the literal Fourth Reich. Since Evans-Pritchard has generally been an intelligent and reasonable observer of past EU antics, the hysterical nature of this column should suffice to demonstrate the extraordinarily dangerous nature of the situation.

And he’s wrong. The bankruptcy is going to happen no matter what measures are taken. The financial media has learned nothing from 2008. Desperately delaying the necessary surgery is not going to improve the chances that the patient will survive.

L’amara vita

Italians aren’t sweating this, but the European banks certainly are:

The Italian 5-year is yielding 6.87% while the 10 year is now 6.77%. The curve-inversion is very bad and is a stark warning: Get ready. This has not yet managed to get to the 2yr (6.38%) Pundits have opined that due to the relatively long duration of the bond portfolio outstanding it’s not a “big deal.” They’re wrong.

This is a very big deal. One year ago, the Italian 2-year was at 2.010 and the 10-year was at 3.924 The Italian 2-year is now rapidly approaching where the Portuguese 10-year was one year ago. What this indicates is that the end of the Euro and the end of the EU in its present form will likely take place within one year. Greece and Ireland were sideshows. Italy is the main event.

The EU’s democracy deficit widens

No referendum for you!

A statement from Prime Minister George Papandreou scrapping the referendum on the $178 billion European bailout package has been provided to the Associated Press. “The referendum was never an end in itself,” Papandreou said. “We had a dilemma – either true assent or a referendum. I said yesterday, if the assent were there, we would not need a referendum.”

It won’t make any difference. The question isn’t whether it’s all going to come crashing down, it’s just a question of which of the many straws upon the camel’s back will be that does the trick.

My expectation is that once people realize they are not only being railroaded, but don’t even have the opportunity to protest, we’re going to start seeing the revival of the Red Brigades soon. As I told the DC radio guy who interviewed me this afternoon, it’s not the crash that concerns me, that’s inevitable and I’m just hoping to stay buckled in and enjoy the ride. It is what comes after and how the popular fury will be channeled that is worrisome.

If I was an elite strategist, that’s what I’d have focused on for the last two years, not wasting the time on playing King Canute.

EU crackdown or crackup

Most likely the former followed by the latter. The EU leaders can blather about the sanctity of the euro and inviolate nature of the Union all they like, but neither threats nor promises can salvage the situation. Their problem is that they can’t keep the Fourth ReichUnion together while continuing to drain the masses dry in order to bail out the bankers. To put the situation in context, imagine the various U.S. states had had the option to opt out of participating in TARP. Why would people in Texas ever choose to materially reduce their standard of living so that Washington could prop up Goldman Sachs and Bank of America and keep them in business? As usual, the bond yields tell a more informative story:

Greece 2-year 92.980% One year ago: 9.784%
Portugal 2-year 19.112% One year ago: 3.521%
Italy 2-year 5.455% One year ago: 1.966%
Spain 2-year 3.872 One year ago: 2.069%

In other words, the Greek default is certain regardless of what happens with the “bailout” or the proposed referendum. Portugal will probably default too, sooner or later. Italy is looking increasingly problematic, while Spain actually appears to be doing relatively well.

Speaking of Europe’s “democratic deficit”

Europe’s leaders are “horrified” that the Greeks might be permitted a voice in their own destiny:

Greek prime minister George Papandreou horrified other EU leaders by announcing that he will ask voters to approve a deal struck last week that would see 50 per cent of the country’s debts written off – but harsh austerity measures imposed for years to come. A ‘no’ vote would prove catastrophic for the EU and could prompt a disorderly default on the country’s debts and an exit from the euro.

Of course, as Iceland has already proven, a ‘no’ vote would be much, much better for the people of Greece themselves. Bad for the parasitical bankers and the EU elite, to be sure, but why should that be any concern of the Greek people?

Daniel Hannan, a member of the European Parliament, puts it in context:

I wish I could convey the sheer writhing horror that George Papanderou’s referendum proposal has provoked in Brussels. Eurocrats instinctively dislike referendums. They feel that their work is too important and complicated to be vulnerable to the prejudices of hoi polloi (or, to be truly pretentious about it, vulnerable to the των πολλων prejudices – for once, the Greek phrase seems apposite).

A referendum at any time would be regarded by European leaders as irresponsible. But a referendum when the euro is teetering on the brink is seen as the height of ingratitude, selfishness and recklessness.

Ingratitude… for what, one wonders?

WND column

R.I.P. European Democracy, 1945-2011

Being for the most part historically illiterate, few intellectuals are prepared to admit that modern representative democracy and the basic concept of individual rights are 18th century phenomena that were the byproducts of a Christian society. They prefer to attribute both institutions to the Enlightenment, despite the fact that it was the Enlightenment that led directly to the revolutionary horrors of the French revolution and it is the Enlightenment that presently serves as the inspiration for the anti-democratic authoritarian bureaucracy of the European Union.

Die another day

The EU puts off the inevitable. But not for long:

Very quickly, there has been much loose talk about EU fiscal union. What was agreed at 4AM this morning is nothing of the sort.

It is a “Stability Union”, as Angel Merkel stated in her Bundestag speech. Chalk and cheese.

“Deeper economic integration” is for one purpose only, to “police” budgets and punish sinners.

It is about “rigorous surveillance” (point 24 of the statement) and “discipline” (25), laws enforcing “balanced budgets” (26), and prior vetting of budgets by EU police before elected parliaments have voted (26).

This certainly makes sense if you want to run a half-baked currency union. As the statement says, EMU’s leaders have learned the lesson of a decade of self-delusion. “Today no government can afford to underestimate the possible impact of public debts or housing bubbles in another eurozone country on its own economy.”

But none of this is fiscal union. There is no joint bond issuance, no move to an EU treasury, no joint budgets with shared taxation and spending, no debt pooling, and no system of permanent fiscal transfers. Nor can there be without breaching a specific prohibition by Germany’s top court, a prohibition that could be overcome only by changing the Grundgesetz and holding a referendum….

EMU break-up is Verboten, fiscal union is Verboten, full mobilization of the ECB – either to lift the South off the reefs through reflation, or to back-stop the system as a lender-of-last resort – is Verboten. Germany will have none of it. Instead we have the summit conclusions – EUCO 116/11 of October 27 2011 – and a great deal of coercion.

Please tell me what exactly has been solved.

I get the feeling that the politicians are desperately trying to play musical chairs, hoping that the collapse occurs on the other side of the Atlantic first. History being a perverse little bitch, this naturally tends to suggest that it is going to start in Asia.

Democracy in the UK

It doesn’t exist:

David Cameron suffered the biggest-ever Tory rebellion on Europe last night. Almost half of all his backbenchers voted in favour of a referendum on EU membership.

Up to 81 Tory MPs were believed to have defied a three-line whip, the strongest party instruction on how to vote. Thanks to Labour and Lib Dem MPs, the vote was defeated by 483 to 111, with around 50 abstentions. It was a worse mutiny on Europe than any suffered by Ted Heath, Margaret Thatcher or John Major, and came after Mr Cameron told his MPs that they could have to wait years before Britain claws back powers from Brussels….

A ComRes survey for ITV’s News at Ten found that more than two thirds of the public – 68 per cent – support the idea of a national vote on whether or not the UK should remain a member of the EU. Yet the Conservatives, Labour and the Liberal Democrats all ordered their troops to vote against a back-bench motion triggered by a public petition, even though the result could have had no impact on government policy.

The parliamentarians appear to have forgotten last week’s salient lesson of Qaddafi. If you refuse to submit to the will of the people on matters they consider to be of sufficient importance, they eventually have no choice but to shoot you in the head.

And David Cameron has revealed himself to be a eurowhore instead of the euroskeptic he previously, and unconvincingly, claimed to be.

Abandoning the treacherous Tories

A former Conservative Party treasurer switches to UKIP:

Alexander Hesketh’s life has been synonymous with the Tory Party. He first canvassed for it at the 1959 election, aged nine. He was a minister in several departments under Mrs Thatcher, and John Major’s chief whip in the House of Lords for three years. He later became Conservative Treasurer.

So to announce that he is to join UKIP as a high-profile campaigner and fund-raiser is no ordinary political defection.

‘I’ve left for a number of reasons,’ he tells me in his West London home. A key factor is his strong belief that Europe has betrayed this country’s working people.

There is absolutely no excuse for the Tories betrayal of the British people. It is quite literal treachery.