The case against the euro
Travelling between Germany and Spain a disturbing question formed in my mind. Has the euro been not just bad for some countries but damaged them perhaps for a generation?
What prompted this thought was my reading of an in-depth analysis of the crisis in the eurozone. It has been put together by the Carnegie Endowment for International Peace. It is called Paradigm Lost - the Euro in Crisis. It features a series of reports by economists such as Uri Dadush, Sergei Aleksashenko, Vera Eidelman and Paola Subacchi.
They chart how the euro crisis started. The paper is rich in data, but even though it lacks characters it reads more like a financial novel. It is the story of a project that started with high hopes, huge ambitions, but which for some countries came crashing to Earth.
The focus of the report is the so-called PIIGS - Portugal, Ireland, Italy, Greece and Spain. Carnegie prefers to call them the GIIPS, but I will stick with the PIIGS. These are the countries most at risk from their high debt levels. The report compares their performance with that of the core countries in the euro, such as Germany. For brevity I will call them the euro core.
As the PIIGS adopted the euro they experienced an almost immediate windfall. There was a steep fall in interest rates. Bond yields tumbled and borrowing became less expensive. There was a spurt in growth. Some countries enjoyed surpluses. In retrospect it seems a golden period, but even early on seeds were being sown that would lead to crisis.
Easy money emboldened investors and consumers to increase spending and run up debts. Foreign capital flowed into the PIIGS. In several of these countries domestic demand exploded and house prices soared. Wages increased sharply.
In Greece, Ireland and Spain credit increased by an average of 155%, but in countries like Germany and the Netherlands, the core, it increased by only 27%.
The combination of lower borrowing costs and expanding domestic demand boosted tax revenues and governments were tempted to increase spending. The money was rolling in. So public spending per person in the PIIGS rose by an average of 76% between 1997 and 2007. That compares to just 35% in the euro core.
In Greece, for instance, government spending per capita rose by 140% in 1997-2008. Greece was awash with cheap capital. As the Carnegie paper points out, the growth in domestic demand "drove up prices in Greece relative to that of the euro area, increasing domestic labour costs and eroding Greek competitiveness."
That is one of the key conclusions of the paper. Since adopting the euro Greece, Ireland, Italy, Portugal and Spain have become increasingly uncompetitive. That and the slowdown in productivity is the heart of the crisis in the eurozone, rather than debt. Debt is a symptom.
Take Ireland. Before it joined the euro it was already prospering. Between 1990 and 1995 inflation and borrowing costs were close to German levels. Its GDP was already growing faster than other PIIGS. In the view of the report "the euro gave an unsustainable boost to an already booming economy". The supply of capital exploded, surpassing 200% of GDP by 2008. It had averaged 40% in the years before it joined the single currency.
Or take Spain: Since 2000 its hourly labour costs have consistently outpaced those of the euro core countries by more than 1%. Spain's unit labour costs have risen by more than 30% since 2000, while Germany's nominal wages have grown roughly in line with productivity.
Loans to Spanish households and non-financial corporations grew to more than 200% of GDP, double what they were in 1998. Much of this easy money financed a building boom. In 2006 Spain started more homes than the UK, Germany, France and Italy combined. In just 10 years house prices more than doubled. In the view of the Carnegie authors, Spain has suffered a loss of competitiveness since joining the euro.
It is a similar story with Italy. Since joining the euro its competitiveness has also declined sharply. Between 2000 and 2009 its wages rose 32%. In Germany wages kept pace with productivity. If Italy had wanted to be competitive it should have kept its wages flat over the past decade.
Then there is Portugal: lower interest rates led to a consumption boom. Household debt more than doubled. The current account deficit soared and labour productivity slowed.
All of these problems were building before the financial crash of 2008. What the downturn did was to "lay bare the fragility of the (PIIGS) post-euro growth model and exposed or underscored the unsustainable trends of their debts".
The PIIGS, however, were restricted in the tools they could use to fight a growing crisis. They were part of a monetary union. "Without control over interest rates (because they were in the euro), the PIIGS were limited in their ability to deal with the bubble," says the Carnegie report. The European monetary policy was too loose for countries like Spain and too tight for Germany.
The crash of 2008 led to a dramatic collapse in demand and the PIIGS were left with high levels of debt.
To escape the debt crisis they need growth, but that depends on being competitive and the PIIGS are struggling to improve their competitiveness without being in control of their exchange rates.
So what's to be done? According to the economists in the Carnegie report, the PIIGS will have to reduce their debts, which most are attempting to do with austerity packages. The debt-to-GDP ratio needs to be on a firm, downward path and to be stabilised within three years. The European Central Bank should maintain an expansionary monetary policy, which it is doing. The authors also believe the eurozone should embrace higher inflation, as it "will ease the necessary cuts in real wages". Germany should stimulate domestic demand. And the eurozone should actively pursue a weak euro. But there are real doubts as to whether all that will be enough.
Take Greece. The proposed cuts in spending amount to 11% of GDP. That is "massive" according to the Carnegie report and "represents more than annual government spending on defence, healthcare and education combined". With that level of contraction it is hard to see how Greece can grow and pay off its debts. Just to stabilise its debt ratio would require Greece to make a huge fiscal adjustment - perhaps 12% of GDP.
For Italy to reduce its debt it needs a balance of 4% of income above expenditure. As the country embraces an austerity package domestic demand is likely to decline or at best stagnate.
To recover competitiveness Spain will have to embrace a 6% wage cut across the board for three years.
So the price of staying within the euro straitjacket is that the PIIGS will have to cut wages and embrace wide-ranging reforms to boost productivity . Government will have to be smaller, more efficient. There is likely to be social tension. The challenge facing the PIIGS is this. If they are to grow and compete they will have to cut wages and reduce spending. Growth will be at best anaemic. Unemployment will remain high. They may escape the bullet, but the potential legacy of having joined the euro is hard times for a generation.
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It looks like there will be a double-dip recession in many eurozone countries. Finland is already in a second down-turn. The reaction of many politicians to the first dip was draconian regulation targeted at the banks they blamed for that dip. But this second dip is due to the euro-federalists themselves who put their power/vanity project ahead of economic stability and the jobs and prosperity of 300 million people. What chance they will now legislate against euro-federalism the way they penalised the financial industry?
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The Euro euphoria was E Europe and S Europe best chance of bootstrapping their economic fortunes; hitching a ride off the stronger economies of N Europe and W Europe.
The euro meltdown exposed the realities.
Living in the real world is good economics.
China does.
India does.
Russia does.
No reason why E Europe cannot.
No reason why S Europe cannot.
If Texas is weak, texans can move to new england
If Florida is weak, they can move to chicago.
If greece is weak, they cannot move to germany
If spain is weak, they cannot move to germany.
These are realities.
The euro needs to grow up - and a truncated version that serves the interest of those who need it the most.
Let germany leave.
Let holland leave.
Let britain stay outside.
Let france leave.
And then the Euro will be a real currency serving the needs of its believers.
So far, it is a virtual currency of a virtual federal republic of esperanto.
And, the current version of the euro is headed for history's rubbish heap, like its language cousin esperanto.
Real world is where real economies belong.
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The Euro was a political rather than a sensible economic project. In the boom times it could brush over this fact but now the cold light of reason is on it. There has been more squandering than investment for a decade. Now, as you say...hard times for generation.
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In my view the report is far too limited in its time line and in its macro economic scope. The inevitable failure of the Euro is part of a much larger picture that begins right after WWII and encompassed first all of Western Europe and then Europe as a whole. Interesting that Europeans would now look in retrospect at how obviously flawed a concept the Euro was when the consequences are plainly manifest yet at the beginning of the process were entirely blind to even the possibilities, their thinking clouded as much by ego as by enthusiasm. Nor does this report look at the underlying mindset which conceived of it and turned a blind eye to it as it was in the process of failing. Only when the failure was inescapable did they even look at the events. They still fail to look at how the common thought process led directly to those events.
The problem begins in war shattered Europe after WWII. The threat that the Nazi juggernaught to take over Europe and with the other axis powers the entire world was gone but a new and even more appealing European born doctrine, Soviet communism presented the same challenge in what would be an age of nuclear weapons and therefore even more dangerous. To prevent Western Europe from falling into Soviet hands, it was in the US interest to make Europe as prosperous and contented as possible. It was not about to replace a Nazi ruled Europe with a Soviet ruled Europe through further indifference. The Marshall plan had nothing to do with that, it was strictly a humanitarian program to keep millions from starving and freezing. Instead the US government enlisted the aid of the only force powerful enough to do this quickly, American private industry. It did this by creating tax incentives for it to invest there creating jobs and industry, establishing unfettered one way trade access to the largest market in the world, the US, and took on almost the entire burden of defending Europe through the canard of NATO. Make no mistake, NATO is America defending Europe at American taxpayer cost. The rest are by and large useful hangers on we pretend are equal partners but even the least cursory examination of who has the weapons, who spends the money, and who does the bulk of the effective fighting leaves no doubt that as a military force NATO is America.
As the first few decades rolled by, Western Europe recovered surpisingly quickly (proving just how powerful American private capitalism is at creating wealth.) And when Europeans became prosperous again, their old hubris, ego, megalomania which are among the hallmarks of their common culture began to reassert itself. Europeans prospered off the sacrifices of American taxpayers and off of American workers whose jobs became uncompetitive just as many jobs would be lost to the far East later on. But as the cold war drew to a close, America withdrew at least some of these favors in what I call an economic hothouse in which Europe flourished. Europe's mistake, the central concept that it failed to recognize was how it actually became in the 1970s, 1980s, and 1990s what it was. It was under the illusion tht it was its own genius that had done it. That is the soil in which the seeds of everything that has happened to it since were planted and flourished. And so today without much of that nutrient of American one sided favor to its trade, of now having to face competition with other nations on an equal basis, Europe is an overbloated unproductive overexpensive over regulted over taxed, place of what are clearly unsustainable social and economic dinosaurs. How laughable Tony Blair was when he said Europe would become the best place in the world to do business.
Except for places that are politically unstable it is the worst place in the world. This will not take a generation to unwind. It will not unwind in our lifetimes. It may never get back to where it was. It kept the whole thing going with smoke and mirrors, lies. Of all the lies Europeans told, those it told to the world, those it told to each other, the worst are the lies it told to itself. It is still lying. It could hardly matter less. The dinosaurs could lie that the meteor hadn't hit or that it would not affect them on the other side of the world. It wouldn't have mattered. And it doesn't matter here either. There is virtually nothing that can be done to reverse the process that now cannot be pretended away. All that's left to do is sit back and watch. 11% reductions of government expense going to change the fate of Greece, or Spain, or Germany? Not a chance. The report left all of this out. Europe is doomed, a victim of its own folly. It did this to itself just as it always does. Only this time there is no United States to bail it out even if it were inclined to. The US has more than enough of its own problems to deal with and a President who is under the delusion that he can still hand out hundreds of millions, even billions in candy to anyone who wants it with their hand outstretched when the truth is that America's cupboard right now is also bare.
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It is clear the euro does not work, you cannot have the same currency for so many countries with such diverse economies.
Germany keeps the Euro going, hopefully one day the Germans will stop having WWII guilt and will pull out..........I would like to see what happens to the Euro then!
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Mr Hewitt's Article is an eye-watering eye-opener!
Even I had not grasped just how bad things had become in the rotting EUropean Union and the shere scale of 'Political' duplicitous misleading about the reality behind the facade.
Talk about feeling vindicated!
For 3 years now I have been writing the following:
The EU-centralising regulatory system has made many EU Nations' Economy stagnate.
The 'west'-EU Nations were in general Economic decline compared to the rest of the World from the mid-1980s; it was the 'west-EU' Economies needed rescuing by the expansion into 'East-European' Nations far more than the 'east' needed them.
The entire EU/Brussels' inspired Statistical Economic analysis of the last decade at least is fraudulent and the claims of unending 'Growth' were delusional paper-dreams.
The EU-Brussels striving for 'ever closer union' is based on a fallacy: That a Union of 12, 15, 27+ disparate Nations in every single aspect of their existence could ever be adequately never mind successfully managed by a core supreme-authority. It is the disastrous Economic-Fiscal-Social policy-making of tyrannies down the ages and ultimately no more effective than any other.
That 'centralising' authority & power in an elite body-politic (often just for the sake of it; without any real thought as to the likely benefits/impact, if any!) without the support of Citizens cannot be sustained as a 'Democratic' entity in the long term.
There is much to be said for a EUropean Economic Community that equates 'progression' with the Rationalising of Tariffs, the Free movement of Goods & the Equalising where possible of Travel-Communication at a pan-European level.
There is nothing to commend an all-embracing, one-size-fits-all, unrepresentative supra-National entity which attempts to displace the Citizens' Rights & Responsibilities by unchecked 'political' connivance solely because it has the power to do so on behalf of 'big-Business/big-Government', and not for any real beneficial gain to the Majority of Citizens.
I cannot agree with Mr Hewitt's conclusion: The EUro 'bullet' not only struck the 15/16 in the zone it is 1 of a plethora of constraining, anti-democratic EU directed munitions wreaking havoc among 27 Nationhoods and 500,000,000 Citizens' lives.
The sooner it is totally reformed or ended the better for all concerned.
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the euro only accelerated what was going to happen anyway. This is a good thing. The responsibility falls on my generation and I am proud to contribute.
"I must study politics and war that my sons may have liberty to study mathematics and philosophy." - John Adams
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Very unsure, even sceptical of this assessment Mr. Hewitt.
At least in Ireland's case, the crash to earth has been conclusively shown to be almost wholly attributable to gross governmental idiocy , neglect, stupor and panic - not Membership of the single currency - the euro-strait jacket you refer to above.
Government failed to apply the appropriate brakes through the instruments at it's disposal. The tax base was atropified to an exrraordinary degree - at the height of the Irish boom, 40% of employees in Ireland paid no taxes, rendering the Exchequer increasingly dependent on the taxes from the highest paid 60% and property taxes. Tax policy itself was was skewed to favour an ever expanding residential and commercial property sector, rewarding developers and speculators to the point of money frenzy with credits and tax incentives. National spatial regulations in regard of local and regional land-use and planning policy ignored. Louche governmental regulation of a runaway banking sector ballooned with obsence profits (where are these billions now?). Increasingly strident EuroZone, EU amd IMF advice to cease as a matter of urgency procyclic budgetary policy, and adopt countercyclical ones, were blithey ignored in Dublin with ever-increasing rudeness, until the crash came. And then ignored for eighteen months as the adminstration attempted to borrow it's way out of the problem, before being caught out as the economy tanked.
And the adminstration's reply - a Bart Simpson like "Wasn't me".
And it is expected that your readers will buy the contention that Euro membership caused this idiocy?
If adults, like economies choose to splash out and binge on money, rather than squirrel some away for the inevitable rainy day, how is this the fault of the money? Are the adults not responsible for their own decisions.
The outcome of any speculation can be either profit or loss. State policy can choose to incentivise or disincentiveise a partiular outcome. Irelands' problem is due to plainly bad government.
No Mr. Hewitt, not all the case in regard of Ireland. 1/10 for this effort - needs much more work. Recommend report writers and reviewer pay much more attention in class in future, and not, gullibly or otherwise, choose to regurgitate fantasies, and present as fact.
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By the way, the good journalist would present "the case for the euro" as a follow-up.
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OP "…the potential legacy of having joined the euro is hard times for a generation…"
Joining the Euro wasn't the PIIGS fatal error. Adapting fiscal management to suit their new circumstances was.
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If there is a limited amount of money circulating - and the rich get richer - then there is less money for the poor.
As there are far more poor than rich there are going to be a few problems - particurlarily if the rich tap into the system succesfully, and hold onto their money.
Perhaps i should go to university and study economics - then my post will be more compatable with the others.
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The real issue isn't being mentioned. The real issue is fiddling the accounts. By fiddling the account government have got away with it, and the mess that they are now in is just a fraction of what is to come.
This is the basis of the fiddle.
If I was a bank, and someone deposits money with me, I have to record in the books that I have a liability. I have to pay that money back at some point in the future. All perfectly normal.
However, if I'm the UK government, I run an accounting fiddle. I take money from people for their pension. However, because of a 'principle' that future governments are not bound by the spending promises of a prior government, I declare that pensions payouts are spending. So in their perverted logic, if it doesn't have to be paid, we can assume it won't be paid. So no liability for the state pension appears in the books. However, as the UK government I'm in receipt of all this money. It has to go somewhere in the books, so its booked as income. Income and no liability means it can be spent, and it is.
So what about civil servants? Well we can't have the liabilities appearing for civil servants and not for the state pension, so the same happens here. There is no liability for civil servants in the books, even though it is contractual.
ie. It's a ponzi.
This is relevant for the current Euro and UK situation. Since all these major liabilities have been hidden, governments have been able to borrow. In some cases they force banks to buy their debts. ie. Lend to them. They do likewise for company pension schemes and annuities. By showing a smaller debt than is the case, people have also assumed they will get their cash back.
The accounting fiddles are far worse than Enron, and have aided and abetted governments. With true transparency on the liabilities, there wouldn't have been the mess.
The more that's hidden, the larger the problem, and the worse the impact when it goes wrong.
nick
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You could compare the euro-project to Chinese General Xiang Yu, who burned his troops ships and crushed the pots in order to not give them any choice but victory. To all you doom-sayers - you are wrong.
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"5. At 12:23pm on 11 Jun 2010, Borzoi1945 wrote:
It is clear the euro does not work, you cannot have the same currency for so many countries with such diverse economies.
Germany keeps the Euro going, hopefully one day the Germans will stop having WWII guilt and will pull out..........I would like to see what happens to the Euro then!"
Borzoi, your name says it all. You are stuck with a mid 20th century mentality and so are many others. The only way forward for Europe is together. Politically and economically. The euro is forcing countries to converge. This is good.
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Oh the joys that the PIIGS nations enjoyed by adopting the Euro. It must have been like being given their very own Credit Card with unlimited overdraft allowed ... and boy-oh-boy did they spend on the card!
The problem with Credit Cards is that sooner or later they get maxed out and the spender has no option but to stop spending and start paying for their excesses.
The Euro was always a political statement of unity but unfortunately the politicians who committed their countries to the Euro project did so without any concept of supporting the weaker countries firstly by preventing them from going on a spending spree and secondly from quite how the Euro currency would be supported if it was ever put under any stress such as Greece having joined the Euro currency with fraudulent financial data and other PIIGS not having the economic strength to grow economically rather than borrow their way to wealth ... a sure-fired recipe for bankruptcy.
The reality of now is that the Euro is being bank-rolled by the northern bloc of the Eurozone but the stagnation and necessary austerity in the PIIGS is such that export-driven growth for the northern EU nations will shrink, wealth will shrink across the piste as austerity measures bite and there is a strong possibility that demands by citizens of the PIIGS nations will rise for the PIIGS nations to leave the constraints of the Euro and return to their own currencies and their own way of life not driven by constraints imposed by the IMF, the ECB and the German Chancellor.
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(formerly Jordan Basset) Another excellent post from Mr Hewitt, he has restored my confidence in the BBC that their commentators can be evcen handed when it comes to the E.U.
As already mentioned above by other commentators this situation is what many people have been forecasting would happen for some time. That said I do have great sympathy for the ordinary people of those countries affected by this mess ans sincerely hope the euro problem can be untangled before it becomes catastrophic for them.
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The fact that the Euro was a political project, and thus built on foundations of sand, was patently obvious to anyone not blinded the need to tether their career and/or income to the EU juggernaut.
Which is why EUrosceptics like me have been right all along, and virtually all politicians and economist* have been proven wrong.
(*Not for nothing was economics called the 'dismal science'. In most cases it is, at best, 20-20 hindsight.)
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"If greece is weak, they cannot move to germany
If spain is weak, they cannot move to germany."
Yes they can.
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So the solution is to cut the salaries and reduce the state expenditure. That's what the Germans did a couple of years ago and what Ireland did last year.
The other thing no one seems to remember is that countries not part of Euro had easy access to money (UK comes to mind easily) and had quite a hard landing too. Why is that different from Euro zone? Because they could devalue their currency? That's what happened to Euro already.
And I have not seen a balanced view yet: no one seems to acknowledge that Euro also has benefits: it is very good for businesses exporting within eurozone because it cuts the expenses caused by exchange rates, bank transfer fees and the like.
Was Greece ready to be part of Euro? Definitely not. Did the Germans know about Greeks cooking the books? I find hard to believe they did not. It is the Euro zone in a mess? Yes. But it is not bigger that the mess UK is in.
You only need politicians with guts and spine and the problems can be solved; Ireland is showing how. It might be harder for Greeks (they might be even forced to exit the Euro zone) but that is hardly a reason for dismantling the Euro zone.
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Well, it may be a thoughtful and well written article, but it still is complete rubbish.
The real differences are between countries that have government regulated economies and those that don't. The GIIPS problems aren't the result of being in the Eurozone, they are the result of having copycat American economies.
Additionally, without the worldwide contraction in credit and trade that resulted from the crash of the unregulated derivatives market none of these counties would be in serious trouble.
Further, Greece's minimum wage was half that of Netherlands' and France's
at the height of the bubble. So their wages are too high and now they have to cut back? How so?
Considering that in the case of Greece, they got some of their economic advice from American Investment banks these countries may be more victims of American irresponsibility than 'PIIGS'.
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Gheryando (9) said “By the way, the good journalist would present "the case for the euro" as a follow-up”
Let’s take a look at how the supposed arguments for the euro worked out in practice. What happened to the famous ‘price transparency’ that would allow costs in different countries to be so easily compared that they disappear? If that argument were valid, how is it that a 30% gap in labour costs has opened up between e.g. Germany and Italy?
What about the famous ‘low-cost of international transactions’ argument. How many such transactions do you need to make before you save the 750 billion euro initial down-payment that van Rumpy has ear-marked to save the euro?
Euro-federalists are all out of ideas, as intellectually bankrupt as Greece is financially.
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Gheryando @9 :
"the good journalist would present "the case for the euro" as a follow-up"
---------------------------
The only problem with that is the fact there isn't, and never was, a case for the Euro. It was a classic piece of EU hubris, defying economic reality for political ideology. Pigeons and roosts . . . . .
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The case for the EURO.
The government of Greece consistently misreported the country's official economic statistics.In the beginning of 2010, it was unearthed that Greece had paid Goldman Sachs and other banks (of the same ilk) hundreds of millions of dollars (starting in 2001) to arrange transactions that hid true debt on the balance sheets.
On 27 April 2010, the Greek debt rating was decreased to 'junk' by Standard & Poor's and fear about Greek default became palpable. Following downgradings by Fitch, Moody's and S&P, Greek bond yields rose in 2010. Yields have risen, particularly in the wake of successive ratings downgrading. As of 6 May 2010, Greek 10-year bonds were trading at an effective yield of 11.31%.
Without a bailout agreement, there was a possibility that Greece would have been forced to default on some of its debt. The premiums on Greek debt had risen to a level that reflected a high chance of a default or restructuring demand. This would effectively remove Greece from the EURO (It would no longer have collateral with the European Central Bank.)
Since Greece is on the euro, it cannot print its own currency. This prevents it from inflating away a portion of its obligations or otherwise stimulating its economy with monetary policy. This is exactly what the United States of America has been doing (is doing): the U.S. Federal Reserve has expanded and expanded and expanded its balance sheet by over $1.3 TRILLION since the global financial crisis began, essentially printing new money and injecting it into the system.
Shortly after the announcement of the EU's new "emergency fund" for eurozone countries in early May 2010, Spain's government announced new austerity measures. The Spanish Government had hoped to avoid such deep cuts, but weak economic growth forced the government to expand the cuts it had made in January. Spain faced pressure from the United States, the IMF, other European countries and the European Commission to cut its deficit more aggressively. (I think in respect to the United States, this pressure on Spain was really hypocritical.)
Financing needs for the Eurozone in 2010 come to a total of €1.6 trillion, while the US is expected to issue US$1.7 trillion in new Treasury Securities. So, between the two, which country/organization is dealing better (much better) with reality?
Two things stand between the US and higher bond yields:
1. purchases of Treasuries by the Federal Reserve and
2. reserve accumulation by the Chinese monetary authorities.
BUT the Chinese have sharply reduced their purchases of Treasuries from around 47% in 2006 to 20% in 2008.
European Union leaders have made two major proposals for ensuring fiscal stability in the long term.
1. the creation of a common fund responsible for bailing out, with strict conditions. This reactive tool is sometimes dubbed as the European Monetary Fund by the media.
2. a single authority responsible for tax policy oversight and government spending coordination of EU member countries. This preventive tool is dubbed the European Treasury.
The monetary fund would be supported by EU member governments.
The treasury would be supported by the European Commission.
However, strong European Commission oversight in the fields of taxation and budgetary policy and the enforcement mechanisms that go with it have been labelled sovereignty infringements. I call them badly needed soverignty support - much welcomed vehicles towards financial health and well-being.
Personally, I’d be perfectly willing to allow the EU looking over my shoulder, making sure I get things right, do not miss American speculation, and do not buy into the blatant print-money syndrome of the United States of America.
The 2009 trade deficits for Spain, Greece, and Portugal were estimated to be $69 billion, $35B and $19B, respectively, while Germany's trade surplus was $109.7B. But in the United States of American a trade imbalance exists and therefore the US must be a net borrower of capital from abroad. Ben Bernanke warned of the risks of such imbalances in 2005.
Alternatively, trade imbalances might be addressed by changing consumption and savings habits. e.g. If a country's citizens saved more instead of consuming imports, this would reduce its trade deficit. Interest rates could also be raised to encourage domestic saving, although this benefit is offset by slowing down an economy and increasing government interest payments. (Interestingly, the Americans have held interest rates at near zero, which whispers: "Inflation coming, big inflation coming.")
The international credit rating agencies – Moody's, S&P and Fitch – have played a central and controversial role in the current European bond market crisis. As with the housing bubble and the Icelandic crisis, the ratings agencies have been under fire. The agencies have been accused of giving overly generous ratings due to conflicts of (American) interest.
Government officials have criticised the ratings agencies and the German finance minister has said traders should not take global rating agencies "too seriously" following downgrades of Greece, Spain and Portugal. Guido Westerwelle, German foreign minister, called for an "independent" European rating agency, which could avoid the conflicts of interest that he claimed US-based agencies have. European leaders are reportedly studying the possibility of setting up a European ratings agency in order that the private US-based ratings agencies have less influence in European financial markets in the future. Due to the failures of the ratings agencies, European regulators will be given new powers to supervise ratings agencies. These supervisory powers will come into effect in December 2010.
Meanwhile, the Spanish Prime Minister has suggested that the recent financial market crisis in Europe is an attempt to draw international capital away from the euro in order that countries, such as the UK and the U.S. can continue to fund their large external deficits which are matched by large government deficits. The US and UK do not have large domestic savings to draw from and therefore are dependent on external savings.
This is not the case in the Eurozone which is self funding.
The role of Goldman Sachs in Greek bond yield increases is also under scrutiny. It is not yet clear to what extent this bank has been involved in the crisis or if they have made a profit as a result of the sell-off on the Greek government debt market, but there was definitely negative, sovereign betting. In response to accusations that speculators were worsening the problem, some markets (e.g. Germany) banned naked short selling.
The ECB has also announced a series measures aimed at reducing volatility in the financial markets and at improving liquidity. Despite the moves by the EU, the European Commissioner for Economic and Financial Affairs, Olli Rehn, called for "absolutely necessary" deficit cuts by the heavily indebted countries of Greece, Spain and Portugal. Private sector bankers and economists also warned that the threat from a double dip recession was still lingering.
Now tell me, would you rather be part of the EURO stability program, along with its financial guidance and stringent regulations, or would you rather be in lockstep with the American-printing-money economy?
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Health-care skeptical Americans will never stop claiming that the NHS is fatally flawed idea, and Euro-skeptic Brits will never stop claiming that the single currency is equally fatally flawed.
Both are equally dogmatic and equally wrong.
The eurozone is facing a difficult crisis (as is the UK-zone NHS, and the latter has faced quite a few over the years, by the way!) But the euro is still 20% stronger against the dollar than it was at its inception and over 50% stronger than it was at its lowest point.
If there's a currency I'd be worried about, it's the British Pound Sterling, which has lost something like 75% of its value against the dollar in the course of my lifetime (and suffered just as badly against euro-zone currencies).
As Mark Twain once said, reports of the euro's death are greatly exaggerated.
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PlanetEnglish wrote: "If greece is weak, they cannot move to germany. If spain is weak, they cannot move to germany"
Yes they can - the EU allows people to move freely between countries. The only thing stopping them is whether or not they have the skills needed to get a job in their destination country.
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20. At 2:46pm on 11 Jun 2010, Larry B wrote:
Hear hear - most sensible and concise posting I've read here today
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"Let’s take a look at how the supposed arguments for the euro worked out in practice. What happened to the famous ‘price transparency’ that would allow costs in different countries to be so easily compared that they disappear? If that argument were valid, how is it that a 30% gap in labour costs has opened up between e.g. Germany and Italy?
What about the famous ‘low-cost of international transactions’ argument. How many such transactions do you need to make before you save the 750 billion euro initial down-payment that van Rumpy has ear-marked to save the euro?"
Freeborn John, you're shooting yourself in the foot by doing exactly what you accuse me of doing. You present facts and link them as cause and effect.
"price transparency" has nothing to do with difference in wages...NOTHING.
The savings in transaction costs have NOTHING to do with the 750 billion fund.
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So we have all been bitten by the excesses of greed-driven economics (I refer to the Financial sectors in both the USA and the UK). The greed trickled down to reach individuals with credit cards and mortgages many of whom where in no position to cope with either in a million years.
And Mr Hewitt leaps out, siezes his opportunity and blames the Euro! Not only that but according to Mr Hewitt we are less than a step away from the arrival of the 4 horsemen of the apocalypse.
Naturally all the apologists for the extremes of capitalism are delighted at being handed an opportunity to defend the indefensible and at the same time bash the EU.
Despite the UK being outside the Eurozone, I hadn't noticed its immunity from the pain being suffered within. Quite the contrary according to Cameron, Clegg & Co.
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inacasino is absolutely right
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"So the price of staying within the euro straitjacket is that the PIIGS will have to cut wages and embrace wide-ranging reforms to boost productivity . Government will have to be smaller, more efficient. There is likely to be social tension. The challenge facing the PIIGS is this. If they are to grow and compete they will have to cut wages and reduce spending. Growth will be at best anaemic. Unemployment will remain high. They may escape the bullet, but the potential legacy of having joined the euro is hard times for a generation."
So that institution produced a nonsense report that told us nothing!!! If they had their own currencies the same thing would happen. The problem is the banking system not the colour of the paper we use to pretend that something we do has "x" amount of value. Economists and analysts like the center mentioned in this report as much value to the economy as the banking system they defend.
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The Euro would work if it wasn't a FIAT.
That way governments couldn't print as much as they want.
Or the ECB (which is its' own worst enemy)
That is the reason why FIATS exist.
So governments do not have to show financial responsibility (otherwise they won't get elected).
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I find it almost laughable that some pseudo-economic gurus can comment that the fault of spending borrowed money (available because the credit line for weak currencies was replaced with stronger borrowing capability on joining the Euro) is somehow the fault of the Americans or that the Eurozone's failing nations are weak because they follow an American style of economy.
PIIGS Countries like Greece have borrowed more from their EU colleague nations than the American Bond market and the money already owed before the bailout was many billions of Euros worth of lending. Even now, to stave of the inevitable collapses they borrow more money from European financial lenders than they get form the US through the IMF.
Then we have the spectacle of Credit Ratings Agencies being criticised because they call the kettle and the pot black when both are not only, blackened but the heat has burnt holes in them both and they are fundamentally unfit for purpose.
Such critics are of the ilk who come up with the idea of a new Credit Rating Agency solely for Europe. What a great idea! We can certainly expect such an agency to give every European nation an absolutely clean bill of health and any fiddling of financial data will most certainly be overlooked as not having any bearing on the solvency of those countries - countries like Greece will no doubt get a top notch rating for lending money to.
If these pundits were not so serious I'd have thought they were having a laugh deliberately ... as it is I find myself chortling at their rose-tinted spectacles which see everything being the fault of America and that no fault can be placed upon the PIIGS nations having spent money when their politicians thought there was no tomorrow and have been caught out (as was always going to happen) when their lines of international credit were cut off or made prohibitively expensive by the very same European banks that lent these nations the funds in the first place.
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What an interesting unbiased analysis by a neutral think tank, Mr Hewitt.
It doesn't explain though how come the UK which stayed out of the Eurozone finds itself now in as deep trouble (if not more) as the GIIPS (or the PIIGS if you prefer, given you're so amused by this childish wordplay)?
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"So the price of staying within the euro straitjacket is that the PIIGS will have to cut wages and embrace wide-ranging reforms to boost productivity."
Whereas Britain, who wisely stayed away from the Euro, is about to enjoy a boom of unprecedented bonanza for the next few years.
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Not entirely sure about the 27 percent 'only' increase in credit in The Netherlands. This country has known a housing boom for some time now, longer than most countries. 675 billion euros of mortgage debt is in hands of 50 percent of the population only. Mortgages are subsidized by the gov't. Everybody with a mortgage can deduct 100 percent of interest payments from its tax declaration, roughly cutting a third of monthly payments. Much of the subsidy has been cashed in by taking out second or third mortgages on homes. And much of this money was used to leverage all kinds of 'investments' on the financial markets. It fuelled an unprecendented spending spree in Dutch history. Very modest people suddenly received massive amounts of money. The whole housing market crashed with the credit crisis (along with a major Dutch bank, two others had to be saved). The country is in a big economic mess and many people have difficulty paying back their debts. This is likely to drag the economy down even further in the coming years, particularly with the austerity measures the new gov't wants to impose (the conservative party that won the elections specifically ruled out cutting back on the mortgage deduction). But the Dutch still have some flesh on the bone if compared to Spain or Greece and look much better therefore, even though the country is not really in a very good shape at all.
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Marcus
If we subtracted the Bank Bailouts (Capitalistic success ?) from the European debt burden would they still be as bankrupt as America or Britain ?
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Gavin, please could you clarify what part of this analysis doesn't apply to the UK as well.
The mythical rebalancing of the UK economy through higher exports never materialised when the pound was near parity with the Euro. Probably even less now with the pound at around 1.20 euro.
http://blogs.telegraph.co.uk/finance/edmundconway/100003591/britains-everlasting-deficit/
(The above is from the Torygraph, obviously no fans of the Euro)
With regards to deficit reduction, the task of the UK is among the hardest because its deficit is among the largest in Europe and other developed countries.
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Gavin
"The case against the euro"
I am sure you (an ardent Eurosceptic by the looks of it) or anybody else can find drawbacks with the euro. Even I can.
But I can also find *at least* one 'case for the euro'.
A single market is way more workable and efficient with one currency than with 27.
Do try to provide arguments against this in your next blog, please.
Unless you are against the single market, that is.
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24. At 3:39pm on 11 Jun 2010, pcastine wrote:
"Health-care skeptical Americans will never stop claiming that the NHS is fatally flawed idea, and Euro-skeptic Brits will never stop claiming that the single currency is equally fatally flawed."
"Both are equally dogmatic and equally wrong."
Spot on. You can tell that Europhobes are involved in a dogmatic group think because they never, ever have anything to say in favour of the euro, not even about the huge bill that UK residents collectively pay (guess to who) for the luxury of exchanging their pounds into euros when they travel to Europe, the no. 1 destination of Britons, with the EU15 (mostly/all Eurozone countries) accounting for approx. 2/3s of all visits abroad by UK residents (Source: ONS
You can also tell that a dogmatic hate agenda clouds the judgement of Europhobes in their never ending predictions of the imminent collapse of the euro, or even Schengen (!). In particular, I love this prediction related to the likely collapse of the latter (dated 12 years ago):
http://www.independent.co.uk/opinion/a-good-time-not-to-say-i-told-you-so-1137440.html
At the time, Schengen included 15 countries. 12 years later it numbers 25 members, including the Europhobe role models Switzerland and Norway, plus 3 in the waiting list.
http://en.wikipedia.org/wiki/Schengen_Area
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Joining the Euro I think sent the very wrong signal that countries now no longer needed to worry or think about there own financial affairs once inside the comfortable parenting blanket of the Euro.
Ireland in particular suffers from shocking corruption and nepotism from a gangster like political elite, vastly overpaid and working in a highly inefficient system that operates on a 'for show' basis where local TD's concern themselves only with their local district channeling money as best they can to ensure re-election and job security.
There has been virtually no regulation of any sector. The construction industry has built some of the worst quality housing in 40 years and is a ticking time bomb yet to be fully exposed.
The euro currency isn't really to blame, in principle it's a good idea. Like I said it's the member states inability to adjust themselves to this new concept that is flawed. Ultimatley we have political systems that don't take a very long term view because the party demands of re-election often require very short term policies.
Basically this boils down to promising everyone more money. Ask yourself this: - When everyone gives €1 in tax but expects to get €2 back and a political elite doing it's best to promise this, what kind of a country will we have? Creating a collective governence system was meant to be about the greater good of all and mankinds bright future, not an exercise in seeing how much we can individually benefit financially.
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quietoaktree @#36
Is the UK Bankrupt? I had not read that which is quite strange - it is not be headline news so perhaps it is simply something in the minds of people who seek to criticise the UK in order to defend the indefensible!
The UK has national debt at approximatley 68% of GNP but the interest rates on the UK loans will be rising to £70billion a year so that is why the UK would be prudent to reduce its national debt now.
The countries that are truly bankrupt are the likes of Greece, Spain, Portugal and Italy where the national debts are in excess of 100% of income (GNP) and - as anyone with any ounce of savvy would understand - where one has Debt in excess of Income then the result is misery ... as one named Mr Micawber so succinctly explained on behalf of Charles Dickens
It is also a case that the very loans that the UK will be paying off are not due to be repaid for at least 13 years so the UK has plenty of time to get its house in order. The PIIGS don't have that luxury as many of their loans are due to be redeemed now or imminently.
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PlanetEnglish wrote: "The Euro euphoria was E Europe and S Europe best chance of bootstrapping their economic fortunes; hitching a ride off the stronger economies of N Europe and W Europe."
European integration in the current form is a joke. It can never be cohesive like US federation because each individual member is afraid of losing any of their local power. Only when the center have the authority/power of US federal government, then Europe will be a true federation, then Europe will become sort a new country. The mess in Greece is typical example of a member who does not care to obey federal rules and stumble. However, it might be quite difficult to unite different parts of Europe than to unite states of North America, at least they speak the same language.
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The reason the UK is in an economic mess is because our Labour government (RIT: Rest In Torment) wasted money like a drunken sailor when the times were good, and didn't make any provisions (i.e. savings) for the bad times. (Broon believed he had abolished boom and bust - ha!)
The UK's new government, however, should be able to steer itself out of the mess if it firmly grasps the nettle of serious cuts in public spending.
Reducing the EU budget and scraping overseas aid would be helpful.
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"43. At 9:00pm on 11 Jun 2010, MaxSceptic wrote:
The reason the UK is in an economic mess is because our Labour government (RIT: Rest In Torment) wasted money like a drunken sailor when the times were good, and didn't make any provisions (i.e. savings) for the bad times. (Broon believed he had abolished boom and bust - ha!)"
good article in the economist about england and how its football team is similar to its society.
"The UK's new government, however, should be able to steer itself out of the mess if it firmly grasps the nettle of serious cuts in public spending."
emphasis on "should"
"Reducing the EU budget and scraping overseas aid would be helpful."
aid is not given for no reason. its a political tool. EU budget is 1% of eu gdp..wont do much or help the general structure of a broken system..
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I'm honestly surprised that Greece didn't pull an Argentina, defaulting, and renegotiating their debts. Argentina is doing much better than expected than if they were still saddled with the debt.
I mean, EVERYBODY here has this underlying assumption that banks or investment institutions should be able to always recover their money, even if they bought bonds from governments, whether or not the government is corrupt, or even remotely able to service the debt.
A failure of due diligence on the side of the bank should be the bank's/investment institution's problem, and they should lose out for their bad bet.
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Buck up. Cause was klepto-corporate amerika. Sue them.
War is our only export.
EU is a good cause/idea to pursue.
Wish to be an ugly amerikan tourist again -- when the buck meets the euro.
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The purpose of the EU and all its predecessors is/was to keep Germany on a short leash. "Ever closer Union," is the EU version of Sun Tsu's dictum, "keep your friends close, your enemies closer."
Whether the euro survives depends on whether the euro area is turned to Germany's satisfaction. The price Germany will pay will be that the euro becomes a transfer union between the rich-north and the poor-south. So whether Germany becomes a more consumerist economy or it stays as it is now, monies will be transferred.
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Noisy little acorn;
"Marcus
If we subtracted the Bank Bailouts (Capitalistic success ?) from the European debt burden would they still be as bankrupt as America or Britain ?"
yes, just as bankrupt as they are now. The banking crisis only served to dry up credit. They just might not have felt it as soon, that's the only real difference. In a tight credit market they can't continue to float the loans that kept their deeply indebted governments floating. It just brought the collapse on sooner. If we don't change our reckless ways, we're headed down the same path. One good way would be to cut military spending by dropping out of NATO. It is of no real use to us anymore. Europe doesn't need defending anymore and wouldn't be worth defending if it did.
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About countries having easy access to money, us here in the UK, Latvia, Hugary, Lithuania! The good thing about the Eurozone countries is that at least now they can borrow from eachother. I don't see Spain or Greece suffering a depresion like the one in Latvia, or Ireland like the one in Iceland! That report that Gavin read was a total waste of time. He'd been better off reading a spy novel or something like it next time he travels to Spain:))
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G and O
"It is clear the euro does not work, you cannot have the same currency for so many countries with such diverse economies."
Of course you can. In America the economy of California is different from Maine's like night and day. No two states have the same economies and they vary all over the lot. It's not the difference in economies that bankrupted Europe, its the commonality of corruption, delusion, irresponsibility, deceit, and expecting life to hand you a living on a silver platter. Many around the world who work much harder or much smarter or both will survive and prosper as Europe falters and fails. The refusal to see that coming is why it happened. Europe will never admit it is inferior. That's the most important reason why it will remain that way.
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23.BluesBerry wrote: European Union leaders have made two major proposals for ensuring fiscal stability in the long term.
1. the creation of a common fund responsible for bailing out, with strict conditions. This reactive tool is sometimes dubbed as the European Monetary Fund by the media.
2. a single authority responsible for tax policy oversight and government spending coordination of EU member countries. This preventive tool is dubbed the European Treasury.
Neither proposal is backed in any way by the peoples, just undemocratic politicians helping their banker friends again.
Personally, I’d be perfectly willing to allow the EU looking over my shoulder, making sure I get things right, do not miss American speculation, and do not buy into the blatant print-money syndrome of the United States of America.
Well, I am not at all willing to have the undemocratic EU decide anything on my behalf. I want the EU dissolved and back to economic cooperation only. I'll take referendums on the EU's plans to have EU approval of national budgets. I bet there are very few people who support such antidemocratic sovereignty and democracy destroying plans.
However, the EU elites do not intend to have those referendums because they already know the people do not agree with them. We don't want their EU bailout fund either because it is a bankers bailout fund. Again, we were not given a vote on this, the antidemocratic elites decided it on our behalf against our wishes.
The more I read about such plans the more determined my resistance to the EU becomes. Sooner or later, we the resistance will need to organize against the EU tyranny in the same way some of our grandparents organized a resistance against the then tyranny in Europe. When democracy is being destroyed, and politicians refuse to listen to us the peoples, what can we do if we cannot vote them out? What can we do if our votes cannot stop the undemocratic 'more integration' process? What ways are open to us to stop this if not the ballot?
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46.Fearless wrote: Buck up. Cause was klepto-corporate amerika. Sue them. War is our only export. EU is a good cause/idea to pursue.
No it isn't. The EU is undemocratic and deliberately so. This is what the political elites want worldwide. A world government run by them without any influence from us the peoples.
Many continents are already under siege and some like Europe already under partial control of the elites. The assault on North American democracies is near. Know how it will start? Politicians will propose some institutions and then assure North Americans those institutions are for 'economic purposes only'. That's how you know the assault on democracy has reached North America. Because that's how it started in Europe: 'Rest assured folks, these institutions have economic purposes only'...
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This article is one sided.
Many people here talk about USA but I think all they know about USA is from television.
Please correct me if I am wrong. USA started as a union of 13 states which later expanded by three ways: war, buying new territories and people free will to join the union. If I am not wrong they acquired territories which were previously Spanish, French and Russians. I do not think that in these territories the language was English. Still, the union survived and still exists and it is gonna exists for a while. The strength of USA was their dream of forming an independent nation. Their strength was that did not have to fight long feed (ultra)nationalism and nationalistic orgolies. So here it is: USA a successful union of many.
Europe has to eat a lot of cheese and drink a lot of wine before it can achieve that.
The crisis in Europe is partly due to irresponsible governments in the S and E Europe and partly due to irresponsible governments in N and W Europe. The fact that everyone points the finger to the other is again irresponsible politics.
N and W Europe had the money, S and E Europe needed these money. N and W Europe put the money in, S and E Europe took the money. Global financial crisis hits. N and W Europe call the money back, S and E Europe remain without money. Two years later wee see the result. I think (very broadly) that makes out for 80% of the current crisis in Europe. And that happened because all members of EU put their own interest before the EU interest as a whole. But, you cannot be part of a union put your interest first and do not expect that to turn against you. If N and W Europe wouldn't have called their money back from S and E Europe, I think S and E Europe wouldn't have experienced at all the economic downturn. I think N and W Europe would have gone anyway over the financial crisis and the current situation may have never occurred. After all their money were making money.
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opinion;
"So here it is: USA a successful union of many.
Europe has to eat a lot of cheese and drink a lot of wine before it can achieve that.
The only thing Europe will eat is crow. All that empty bluster and boasting so typical of Europe. "The best place in the world to do business" Tonly Blair boasted he'd make it. It's a lot closer to the worst. Besides, when they're broke, crow will be the only thing left they can afford. Will zat be ze crow au gratin, ze crow bernaise, or ze crow hollandaise monsieur?
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@25 tom_p_willis
"PlanetEnglish wrote: "If greece is weak, they cannot move to germany. If spain is weak, they cannot move to germany"
Yes they can - the EU allows people to move freely between countries. The only thing stopping them is whether or not they have the skills needed to get a job in their destination country."
yeah, right.
Because the German firm will hire someone who doesn`t speak German (don`t even dare thinking of France here...)
Or wait, there is no way either the employer or the freely moving worker can`t speak English fluently, right? Right?
Geeze...
Wake up, not all jobs are white collar jobs and need a university degree.
Many people in Europe don`t speak English well enough for the language barrier not to be a problem.
The Spanish mechanic can`t be rejected for the fact that he isn`t a local. But he can be rejected for not speaking the language, thus not meeting the demand.
But I have a great idea: let him go to language school! It`s for free and you get chocolate and candy every day!
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@33 Menemedus
"Such critics are of the ilk who come up with the idea of a new Credit Rating Agency solely for Europe. What a great idea! We can certainly expect such an agency to give every European nation an absolutely clean bill of health and any fiddling of financial data will most certainly be overlooked as not having any bearing on the solvency of those countries - countries like Greece will no doubt get a top notch rating for lending money to. "
Well, then those agencies wouldn`t act much different from those located in the USA.
;)
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54. At 01:43am on 12 Jun 2010, MarcusAureliusII
"The only thing Europe will eat is crow. All that empty bluster and boasting so typical of Europe. "The best place in the world to do business" Tonly Blair boasted he'd make it. It's a lot closer to the worst. Besides, when they're broke, crow will be the only thing left they can afford. Will zat be ze crow au gratin, ze crow bernaise, or ze crow hollandaise monsieur? "
It seems that you do not like Europeans.
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"50. At 11:48pm on 11 Jun 2010, MarcusAureliusII wrote:
G and O
"It is clear the euro does not work, you cannot have the same currency for so many countries with such diverse economies."
Of course you can. In America the economy of California is different from Maine's like night and day."
Hmm MAII, I actually never said that but I nevertheless agree with your statement.
By the way, I just realized that you actually really like Europe. It made me smile.
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Opinion;
"MarcusAureliusII
It seems that you do not like Europeans."
OMG, the secret is out. Now everyone will know. How did you guess? What gave it away? Which clue was it?
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G and O
"By the way, I just realized that you actually really like Europe. It made me smile."
What I like about Europe is how superior it makes me feel. And if things aren't going well, it makes me feel lucky. I look on the bright side, what if I had the same problems (whatever is bothering me at the moment) and I lived there. I just imagine how much worse things would be. And that makes me smile too :-)
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So here we have Mr. Hewitt recommending us to read an American report about the Euro. The recommendations are mainly : 1) keep the euro low w.r.t. the dollar, 2) cut wages in the PIIGS countries, and begin with public wages, 3) address 'rigidities in the labour markets' in order to become more 'competitive', 4) consider debt restructuring for Greece, 5) expand domestic demand in Germany, 6) don't rush to extend the Eurozone, 7) reassure 'markets' and 8) use 'moral suasion' to force readjustments in Europe.
Most of this has been covered before. It does not need a bloated 139 page report to say this again. This report is exceptional : of the 139 pages 20 are completely blank (OK, not being an economist, even I understood the content of those pages) and 5 were big title pages. A lot of the other stuff was repetitive. I fail to understand why Gavin wanted us to read this.
Or was Nik right in smelling that Gavin pulled a quick one to distract attention away from the interesting political situation in the Netherlands ? After all, here you have an election which saw huge shifts in political allegiance, and a (temporary) eclipse of the christian democrats. Yet the possibilities to make a government are not obvious at all. Alternatives are a right of center coalition of 3 (VVD + PVV + CDA) with a 1 seat majority, or a 'purple' coalition of 4 (VVD, PvdA (Labour), D66 and GreenLeft) with a 7 seat majority. The last possibility has the benefit of excluding Wilders from government. However, 'purple' governments are by necessity a 'mixed mariage' of pro-business and pro-labour policies. A mix not unlike the mix of the anti-EU stance of the Tories and the pro-EU stance of the LibDems in the UK. Why not an in depth discussion of this, rather than a rehash of known (shoddy) anti-Euro 'analysis'?
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#8 Micklaus
You need to give a lot more thought to the connection between the Euro and your government's Idiocy .
The reason for the strife in the Eurozone is that most other governments did the same as your government .
The Euro gave an open invitation to borrow and spend ; believing there was no end to the good times . Now the Eurozone countries have debts more than they can pay , some are nearly , if not , bankrupt .
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You got to give props to the Brits. They played their cards right. For example during the colonial times they anticipated changing times and gave colonies independence. Most of those ex-colonies(except for a few like India) have since now crashed under their own weight thanks to the greed of their own people who squander public funds. While the Brits ruled them their infrastructure exploded fueled by sustainable funding as oppose to loans. Then the Euro zone thing came to light and they stayed away knowing very well that the British Pound was too valuable to scrap while the PIIGS got drawn in to their doom. Credit must be given where due.
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#12 Nik
As you accustomed to writing so much and actually saying so little ; perhaps you could stretch to including all the other countries who run an accounting fiddle . A Europhile will love to name eurosceptic Britain ; what about Greece , Italy , Spain , Portugal , even the EU itself ; the countries that are in the Eurozone .
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#23 Bluesberry
" The case for the EURO "
You have done what I expect politicians or EU Commissioners to do ; propose a subject and immediately deviate from it .
You have written a great deal ; but you have not made a case for the EURO .
Truth is , there isn't one !
The choice between two equally unpalatabes at the end , speaks for itself .
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#51 mvr512
Very well said !!!
All across Europe we need to create associations of people who think as we do . The people are there , but Apathy is a great problem .
I think our best hope , as I see the EU and Euro today , is that the former will implode and the latter colapse .
It is my opinion , that however hard they try , there will never be a federal state of Europe !
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#53 opinion
You are right about the self interest of member states and their folly in not controlling their budgets or seeing any possible dangers ahead .
It is my guess , that the single currency idea was sold to the individual states , on the basis of just those seeming benefits of borrowing without restraint that they have abused .
If in depth rational thinking and impartial analasis had been applied , both at Brussels and by individual states , the Euro might not have got off the ground . We mustn't forget that its real purpose was to give the EU a cosmetic appearance of a federal state . You cannot have a " one size fits all " currency , shared by idividual sovereign states with such vastly varying economies .
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#60 MarcusAuraliusII
You are capable of making some very good comments ; likewise you can make some very crass ones .
I think you would enjoy giving Europe a kick if he was dead on the floor .
When everything is going wrong around us ; it gives us a sense of smug well-being , when we see someone else in a seemingly worse state than ourselves .
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once again, if not having a huge debt or a crisis was as simple as not having the euro and the cheap credit it entitled, then Latvia, Hugary, and us in the UK would all fine. In fact we are not, we are worse off than the Eurozone countries, how did that happen?
So it is obvious that the Euro is a good thing!
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The Euro crisis made easy too understand,compare it with the European football major leagues and even Sun readers can get to grips with it.
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ChrisArta
It is obvious the EUro is a good thing.
Yeah, along with the huge oil spill off the Gulf Coast being beneficial to the Amercians resident there I cannot think of anything more obvious!
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Well this childish article doesn't explain why is the Pound Sterling in a deeper crisis that the Euro ! ! This just shows how Euro-skeptic Mr. Hewit is.
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ChrisArta @69
I suggest you have a weak argument to compare the state of the UK economy and UK GBP to make your point that the Euro is a good thing!
I suppose the idea is that if one criticises the rest of the World enough that everything in the EU garden will look rosy ... unfortunately that propaganda does not hold enough substance or calibre to be effective let alone believable.
You promote the idea that the UK is in a worse state of economic health than the Eurozone nations as a counterfoil for the woes of the Euro.
The UK National Debt is 68% of GNP which means the UK has more income than debt. On the other hand, Greece, Portugal, Spain and Italy have national debts in excess of 100% of their GNP, i.e they have borrowed more money that they earn through revenue and economic growth.
Accepting that any debt is bad as that means the borrower has to repay interest, I would accept that the position of the UK is not good and the new UK Coalition Government has, quite properly, set a priority to reduce the debt and tackle the interest payments which would rise to £70bn GBP per annum by 2014 - if national expenditure and borrowings by the UK are not reduced.
However, it is not reasonable to suggest that the UK GBP is worse off than the Euro as that is palpably and factually not correct. The UK is not having to borrow money in order to keep functioning.
The UK government (through its Central Bank)can raise or lower interest rates, apply "Quantitive Easing" or even revalue the UK GBP if it so wishes whereas the EU cannot do any of those activities as any such action would help some nations in the Eurozone but hurt others economically.
The UK GBP and Euro have fallen in value against the dollar but I have to say that the UK Bank of England has deliberately let the UK GBP slide by maintaining the lowest ever Bank of England Interest Rate for the longest period of time (now 15 months) which has forced a technical devaluation upon the UK GBP. I think you'll find the Euro has lost value simply because of fears of Greece (and also concerns over the economies of Spain, Portugal and Italy) being unable to fund its debt repayments and cuurent interest payment obligations. As a result, investors have been divesting the Euro for more safe currency or buying gold leading to the fall in the value of the Euro.
Fundamentally, the Euro is screwed because of the diversity of scope, capacity and durability of the divergent economies that make up the Eurozone. The UK does not have that problem as England, Scotland, Wales and Northern Ireland share the same currency but also share the same economy.
By all means factually criticise the UK for its own economic woes for lack of good financial regulation, excess public spending, lack of investment in the private sector and poor state of the UK economy that has resulted from years of government mismanagement but trying to suggest the UK is worse off to defend the EU (let alone the Euro) is naieve if not intentional.
If intentional then you make a fool of yourself - and the Euro - with weak comparisons that do not stand close scrutiny.
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mvr512
Re 51
Sound, sensible, accurate and entirely logical opposition to EU/Brussels proposals that further encroach on National sovereign democratic processes.
So, must agree, absolutely no chance the EU elitists will ever seek to consult never mind allow a single Citizen Vote on any of it.
EU Democracy in action> We all just love it!
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Chris Arta
Re 49
With 40% Unemployment among Under 25 Spaniards and 80% of Spanish construction industry closed down I dread to think what You consider as #suffering a Depression#!
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62. At 04:22am on 12 Jun 2010, Huaimek wrote:
#8 Micklaus
Huaimek, I've got to disagree.
Firstly, the principal party in this current government has previous form in this area. Reckless previous borrowing in your currency, American currency - any currency, blighted Ireland during the seventies and eighties. For them this current problem is a return to old form.
The financial discipline required to become a Euro member MADE the Irish economy - not access to easy credit. Access to cheap credit facilitates business and investment. Failure to govern and regulate coherently helps no one.
You said "The Euro gave an open invitation to borrow and spend; believing there was no end to the good times". I vehemently disagree. Government failed to govern and regulate in Ireland since 2004, and it is now reaping the whirlwind it so casually sowed. This is the conclusion of three recent independent reports, one from the IMF.
Nowhere in these reports Huaimek, is Euro membership highlighted as a problem for Ireland - rather, it is highlighted both domestically and internationally, a tremendous support for Ireland. When Ireland completes it's present corrective action and returns to the discipline envisaged, and properly regulates economic development, thankfully this time with peer-review, it will clearly continue to be a boon for Ireland.
There is no invitation to borrow on cheap and easy credit. This is a myth perpetuated by anti-EU and anti-Euro alike - EuroZone interest rates are currently higher than the UKs, and Japan's.
I put it you that this article is so far wide of the mark in respect of Ireland - 90% + of whose current problems are in response to lack of domestic gumption, that it must be equally wide of the mark with respect to other countries currently in difficulty. Assessment of the regulatory climates in these countries will illustrate a similar lax regulatory environment, contributing hugely to their own problems.
I challenge you to show how such an environment emerges as a consequence of Euro membership.
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Gheryando
Re $$
Yes I read that Economist article.
Seldom has so much tosh and waste of space based loosely around an upcoming Football Tournament been published.
Let us look at it another way.
France has an economy and social structure just like its Football Team. Germany has an Economic and Social framework resembling its Football Team.
Italy, Greece, Netherlands has...
Here is a rational thought process.
Football is a game where 22 players kick a bag of wind around a pitch for 90 minutes.
A National Economy is about 60,000,000 UK Citizens, 63,000,000 France Citizens, 80,000,000 German Citizens and there is no time limit at all.
Yes, the connections between the Sport and the Economy are obvious!
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Johnn K
Re 72
Quite amazing how upset the pro EU & EUro Citizens get when a key aspect of their beloved ever closer union project comes under close scrutiny!
To my mind BBC is far from perfect and Mr Hewitt is 1 of a number of BBC Journalists lacking investigative zeal and the key word verification also comes to mind with quite a bit he writes, though not this article.
That said, perhaps if you had understood Mr Hewitt is the BBC EUropean Editor You might have seen that the Article was far from childish and gave a proportionate account of the region this Journalist has as his remit for reporting.
I look forward to Your next contribution which doubtless will be full of adult commentary and not simply try to deny anothers analysis by foolish labels!
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"how superior it makes me feel" the analysis of a psyche that had revealed itself over and over finally put into the key words.
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BluesBwerry
Re 23 and the case for the EUro.
That was a really lengthy funny effort.
Bsically it is summed up by the following unsubstantiated excuses> it was almost all the fault of 1 EUrozone member Greece, the Ratings Agencies and the USA & UK.
11 of the 15 original EUrozone members cooking their accounts to fit the entry qualifications was some other Nations making them do it!
A decade of supposed progression and prosperity within the EUrozone is all brought crashing down in months by other Nations not in the zone!
Similarly, after a decade of no EUrozone complaints about the International Ratings Agencies suddenly in 2009/10 the EUrozone and Brussels find they are at serious fault for pointing out the obvious Financial insecurity of some EUrozone Nations!
It got to the ridiculous point with the following distortion of reality. "..unlike the EUrozone which is self funding".
It is beyond me how You could even think to write a word of that sentence and not blush for all the World to see!
A 750 Billion bail/out Reserve Fund inc. IMF Money plus Monies from non/EUrozone Nations, as well as the ECB having to change its "strict rules" and buyout Bonds, but You still have the nerve to suggest the EUrozone with its new structures and supervisory powers is self financing.
There we have it again! The timeless EU/Brussels contrick> When things are going well it is all because of the clever, farsighted, skillfull policies of the EUropean Union and whenever things are going bad it is all the fault of everyone except that talented EU/Brussels entity!
I have to be polite so I will leave it at that.
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CharlesNorth
Re 70
Yet another in a long, long, long undistinguished line of proEU & proEUro whose substantial intellect and ability to pour scorn on others who do not share their views is only outweighed by their utter lack of grace and as importantly no ability whatsoever to present a coherent, logical and substantiated argument for either the EU or the EUro.
Good day.
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The answer seems rather obvious: allow Germany to run a federal, united Europe, both politically and economically. The problem goes away. Oh - you might have to kick the UK out to achieve this, but Europe won't miss the Brits much, will they?
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@50MAII
"Of course you can. In America the economy of California is different from Maine's like night and day. No two states have the same economies and they vary all over the lot. It's not the difference in economies that bankrupted Europe, its the commonality of corruption, delusion, irresponsibility, deceit, and expecting life to hand you a living on a silver platter. Many around the world who work much harder or much smarter or both will survive and prosper as Europe falters and fails. The refusal to see that coming is why it happened. Europe will never admit it is inferior. That's the most important reason why it will remain that way."
Man, seriously dude. Your ability of self delusion is phenomenal.
You are really thinking that the USA are better off people there are working harder than in Europe.
Just let your unfounded feeling of superiority go. It won`t be good for your health when the USA finally go bankrupt.
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25. At 4:05pm on 11 Jun 2010, tom_p_willis wrote:
'PlanetEnglish wrote: "If greece is weak, they cannot move to germany. If spain is weak, they cannot move to germany"
Yes they can - the EU allows people to move freely between countries. The only thing stopping them is whether or not they have the skills needed to get a job in their destination country.'
EUpris: In the early eighties in Germany my very good German boss, a Catholic priest, very selfishly dropped dead.
He was replaced by a Catholic priest with a doctorate in Moral Theology who was an arrogant non-stop liar.*
So naturally I started looking around for another job. I got the jobs newspaper from the local job centre. About one third of jobs said "only Germans."
My new boss said to me: "You haven't got any qualifications." I said "Excuse me! I have two qualifications from British universities."
New boss: "You haven't got any German qualifications."
I have other examples I could give. So generally, it is not going to be easy to get a job in Germany unless there is a big shortage as there was in the early seventies when I went there.
I suggest they should try Canada.
* In general my German bosses were good. This bloke was the one exception. In general my British bosses were rubbish with some exceptions.
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@53 opinion
"The crisis in Europe is partly due to irresponsible governments in the S and E Europe and partly due to irresponsible governments in N and W Europe. The fact that everyone points the finger to the other is again irresponsible politics.
N and W Europe had the money, S and E Europe needed these money. N and W Europe put the money in, S and E Europe took the money. Global financial crisis hits. N and W Europe call the money back, S and E Europe remain without money. Two years later wee see the result. I think (very broadly) that makes out for 80% of the current crisis in Europe. And that happened because all members of EU put their own interest before the EU interest as a whole. But, you cannot be part of a union put your interest first and do not expect that to turn against you. If N and W Europe wouldn't have called their money back from S and E Europe, I think S and E Europe wouldn't have experienced at all the economic downturn. I think N and W Europe would have gone anyway over the financial crisis and the current situation may have never occurred. After all their money were making money. "
Did you ever open a economics textbook?
Oh wait, you don`t even need that to see that your argument makes no sense.
If a nation is spending more than it is taking in, its debt increases.
Common sense.
That is the problem of the PIIGS and, for the most part, of all European nations.
Lastly, who called his money back? Greece for example had 20-30 billion waiting on EU-accounts. But you only get that money if you use a specific quota of your own money as well.
We have way too many officials in Europe with a mindset just like yours. Money can safe everything and the rich ones should just pay so the poorer ones can develop.
So why are the PIIGS not financially and economically stable? After all, money is ought to be their lord and saviour.
Time to face reality:
If you earn 2000 euro a month, but spend 3000 by making debt, my 100 euro present every month is not gonna help you.
And even if I give you 1000 euro for free. Know what will happen? You won`t question your way of spending. After all it`s +-0!
Nevermind that without the free money, you couldn`t sustain the spendings.
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@73 Memedus
"However, it is not reasonable to suggest that the UK GBP is worse off than the Euro as that is palpably and factually not correct. The UK is not having to borrow money in order to keep functioning.
The UK government (through its Central Bank)can raise or lower interest rates, apply "Quantitive Easing" or even revalue the UK GBP if it so wishes whereas the EU cannot do any of those activities as any such action would help some nations in the Eurozone but hurt others economically."
Here we go, and I thought that the crisis taught us something.
After all, the most important institution in this whole bubble was the FED.
All things you are suggesting will make the normal people poorer as well.
Macro ecnomics first semester.
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The Case for Competitive Devaluation is the real title for this thread. It is necessary to not examine the case against the Euro in isolation, but also to look at the nature of a system (or in this case Europe) of competing currencies.
Logically the advantage that currencies outside the Euro have is of competitive devaluation. So to say you are against the Euro MUST also mean that you want competitive devaluation.
So what is so different between the two situations and who wins and who loses in both cases. That boils down to who benefits from currency instability. The one group that most definitely do benefit is the money changes and those able to buy and sell the currencies and benefit from arbitrage. In this group are the wealthy and the banks. So logically everyone else must be losers or unaffected.
So to want to leave the Euro is the same as wanting the banks to make more money out of the rest of us and to have more power.
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#73. Menedemus wrote:
"The UK is not having to borrow money in order to keep functioning."
So what you are sying is that the £156 bn we borrowed to run the state last year (or the £136 bn to £ 163 bn we are scheduled to borrow this year ) is a figment of our imagination? tosh....
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Dear ones,
WEll,I dont understand why the world started with the debt financing thing?Thats the only worst thing that was given a backing by all the major business brains including the governments.Everywhere promoting loans business is the only rootcause for all this chaos.Further oiled by public greed for availing of worldly pleasures at any cost - even by putting all hair to the loanee.The desires of men are endless and the decontroll and playing with them is the only cause of all this disaster.Why does a Gov run intoa debt?Because it keeps on taking and taking loans without needs or funding useless needs of its own parties and people.Control over desires is necessary to come out of this crisis.Why do u fund someone who has no resources - just based on his future earnings when nobody's future is secure?And the Govs make such rules where more and more biggies are free to take up the hardearned money out of the public pockets and put them in unreasonable things which on their face seem to be unreasonable.But still the Govs back up them .They keep asking for more and more - the Gov is satisfied with the employment generated the taxes it gets etc.But what about the saturation point?There always is such point and I think that no Gov has been ever thinking about this point.They simply keep on increasing the point to a higher level.One who produces 100 million tons wants to produce 1000 million tons and the 1000 m ton person wants to make it 10000 m tons.This is simply ridiculous.We are more wasting the reaources than creating or conserving them.The big corporations have been powerful enough to wade away any controversy against their goals.Well.Please think over this way.Just - first keeping pouring money into the useless person's coffers and let them play with the world and then when they go bust then again fund them by bail outs.This is simply ridiculous.Bail outs are simply fraud with the general public.The disasterous people should be sent to the moon without any oxygen etc.that is the only remedy for the world to come out of the crisis.
Thanks for bearing me.
With regards
R from India
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To John_from_Hendon (87) and (88):
To add to your argumentation...
1) Competetive devaluations lead to more competetive devaluations. For example in yesteryears when either Finland or Sweden devalued their currencies to make their export industries more competetive, the another one would soon make the same devaluation leading to a devaluation cycle.
2) Devaluations move money from holders of cash in minor extend to asset holders and in large extend to owners, operators and stakeholders of export industries.
For example in yesteryears when Finnish forest industry corporations had made over investments or unions had gotten too high pay rises, the consequence wasn't shutting down of factories or decreasing of wages, it was devaluation of the external value of currency.
Only after Finland joined the Euro, forrest industries and unions couldn't anymore make the rest of the society pay for their mistakes, thus we have had factories and plants being closed, forest industry workers getting smaller raises or being downsized. This has been a major positive element as it has made industries to be more dilligent over their investments and unions to be less opportunistic.
Intentional devaluation of a currency isn't a good thing, it is a way to shift money from one part of society and economy into another part without people asking too hard questions or in many times noticing the transferral of wealth.
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H;
"I think you would enjoy giving Europe a kick if he was dead on the floor ."
Now what would be the fun in kicking a dead body? What kind of individual would think such an idea. What is fun is saying "I told you so" and being proven right. I predicted this would happen all along and it had been dismissed and pooh poohed by Europeans as nonsense. Somehow they had a new paradigm, "a third way" as they called it. Somehow they were smarter and better than everyone else. They had reinvented the laws of economics and could live better than the rest of the world because of it. They wanted everyone else to see the light and become like them. But nobody took the bait.
I've said that Europe has nothig to teach America except as a bad example to avoid following. And this is a perfect case. If America continues to go down the same road of government spending far more than it takes in, it will wind up in the same soup even if its books are open and we know exactly where the money really goes. This is proof that the tax and spend policies of the Democrats and more recently even the Republicans won't work, they will ruin us too. But we still have time to avoid that fate. The Tea Parties are an example of a grass roots bottom up revolt against what is happening here. Europe's fate only lends it more credence. Time for America to repair its own house before its roof caves in too.
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Drugstore man;
"Man, seriously dude. Your ability of self delusion is phenomenal.
You are really thinking that the USA are better off people there are working harder than in Europe."
First of all I said that a single entity comprising different states with very different economies can successfully share a single currency. America is proof of that, the US dollar although a little tattered at the moment is still the world's number one currency, US Treasury Securities still viewed as the safest investment in the world. That is why so much worried money from around the world is headed this way, even when interest rates paid on them is nearly zero.
"Just let your unfounded feeling of superiority go. It won`t be good for your health when the USA finally go bankrupt."
You only say unfounded because you either don't know the truth of it or are terminally jealous. Do Americans work harder? Just watch anyone in America who owns his own business here as so many tens of millions of Americans do. Many of them work 25 hours a day 8 days a week at it. And if one of them goes broke, they start another and another and another until they create one that is successful. Can the American government go technically bankrupt? Unlike Europe I don't think that is actually possible. Economic experts here tell is it can print virtually a limitless amount of money. But it seems it won't have to. For America this episode like much worse ones in our history will end and we will prosper again. I don't see the same for Europe. I don't see it ever recovering. I think this time it may really be the end for a very long time. Of course that would make Europe even angrier at America than it is already. Not only falling even further behind than it already is but the European experiment having proven an undeniable failure while the American experiment has been and continues to be an undeniable success. Want a reminder? Just to refresh your memory, take out a picture of our beloved President and look at it. Do you Europeans still love and admire him as much now as you did screaming and cheering when he visited you during the last Presidential campaign two years ago? My opinion of him has not changed however. I still see him as inexperienced (although the BP incident proving he didn't learn from hurricaine Katrina clearly less so than he was) and too far to the left. But I wouldn't trade him for any of yours, the new ones or the previous batch. He's still a cut above what Europe's got.
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John_from_Hendon @87
Tosh you say but you read my comment and put your own spin upon it.
Gordon Brown and his government spent, they did not borrow, £167bn GBP and committed to spend further revenue up to and including 2014 to bailout the UK Banks but Brown's government did not do so to repay any existing loans like Greece has had to do.
It is entirely arguable as to whether the Brown government were right to nationalise any part of the UK Banking sector but they were spending within the UK's means and as part of their economic strategy to lessen the impact of the Global Financial Crisis.
Greece has recently epitomised the root difference between the UK and the GIIPS economic problems in that Greece has had to borrow from the hurriedly created EU/IMF funding-only-available-if-absolutely-necessary Euro-Bailout Fund simply to fund the repayment of loan interest and redeemed loans that were due for repayment in April/May. The UK is not in that position.
The main thrust of my comment was that some commentators here persist with the fallacy that the UK Economy is worse than that of the GIIPS and therefore the GIIPS position is not so bad and the Euro still a wonderful project. That is truly tosh!
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Drugstore man;
Here's a little game you can play. You are the Vice President of Schlaffenfaffel Kompany and are assigned to select a place to build a new factory that will make your company the leading manufacturer of doohickey widgets in the world. Your compensation for the next five years will depend on how profitable that factory will prove to be. The selection committee on the board of directors has narrowed down the choices to two areas, Stutgart and Shanghai. Take a pice of paper and draw a line down the center. On the left at the top write China, on the right Germany. Then draw a line down the center of each half. Under China one column on the left list reasons to build in China and on the other reasons not to build in China. Then on the right do the same, reasons to build in Germany, reasons not to build in Germany. Take your time. List every single reason for an against for both. When you're done, hold the paper at a distance? Do you see the lists on the two outside columns very long and the lists on the two inside columns very short? That is why even German companies are building in China. BTW, depending on what the nature of the product happened to be, if one of those two columns was America and the other China or Germany, in all likelihood, the decision would be far less clear cut.
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@87 John_from_Hendon
"The Case for Competitive Devaluation is the real title for this thread. It is necessary to not examine the case against the Euro in isolation, but also to look at the nature of a system (or in this case Europe) of competing currencies.
Logically the advantage that currencies outside the Euro have is of competitive devaluation. So to say you are against the Euro MUST also mean that you want competitive devaluation."
I wouldn`t necessarily link these two things together.
As far as I know, there is no statistically and empirically proven long-term link between the devaluation of a currency and competetiveness on the world markets.
All literature I`ve read on this topic so far suggests that competetive devaluation may be negligible.
A Euro as the staple of stability is not a bad idea and I don`t think many people will say otherwise.
I was in support of the Euro from its very beginning and I was not part of a majority in Germany.
However, what has happened during the last 6 months threw all my hopes over the railing. ECB policy was not only poor, it was catastrophic.
But it wasn`t only the ECB. Almost every government in the Eurozone used credit expansion for decades as a means of refinancing the state, which consequently lead to enormous debts.
When the Euro got introduced, there was my hope that a stable and strong currency, which could not be devalued at the blink of an eye, would lead to the member nations fixing their budgets.
After all, the Deutsche Mark was not as stable as many people. We had high inflation in the 90s, reaching over 4% in 1999. That`s not what I call stable.
Then there is another thing that shouldn`t be disregarded:
How people perceived the new currency and its effect on their lives.
In Germany, the word "Teuro" (from: teuer = expensive) was coined as people perceived the prices to have skyrocketed.
CPI did not verify this, however.
I won`t go in length on this subject, but in case you are interested: [Unsuitable/Broken URL removed by Moderator]
In conclusion, you cannot say that people who are against the euro are for competitive devaluation. Especially the normal people have nothing to gain from it, but a lot to lose.
According to the quantity theory of money, increasing the money supply (and competitive devaluation effectively does this) drives the price-index upwards.
An interesting question on this topic would be, why the perceived inflation (or the perceived development of the price-index) is much higher than the CPI.
I have the feeling that putting the blame on the lacking development in real wages over the last decade alone is not a sufficient answer.
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#88 John_from_Hendon
As again, you appear to be one of few knowledgeable on this topic.
What worries me, is that the massive Bailouts on both sides of the pond do not appear to be calculated as national debt ?
Did I miss something?
How bad is the real picture if it is included ?
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noisy little acorn, you and JFH are pathetically ignorant. Many of the bailouts are in effect bridge loans that will be repaid with interest. Not only did you miss that but you missed that these loans are being given to banks to invest in US Treasury obligations which will be paid back at higher interest. The difference is recapitalizing the banks at taxpayer expense. The difference in interest will be national debt as will the losses on the toxic assets the government is acquiring from the banks. At least that is how it is working here. Of course the UK and US have to borrow money to lend to the banks. The bright spot in the scheme now is that the interest the US pays on short term bonds is nearly zero. Once the banks are satisfactorily out of the woods and the loans repaid, the US government will be free to print money like crazy to deflate the value of past debt. I don't see any way out of this. But if we hold out long enough, Europe will go broke first. Their interest rates they pay out are much higher because the market doesn't trust them. They will either print money to deflate their own currency or face endless depression which may come anyway. The balance of the world's wealth is undergoing a sea change, it is moving to the US and China where it belongs.
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#91 MarcusAuraliusII
We all get the I told you so . I too was predicting problems with the Euro before it came in ; I had heated discussions with Italian friends .
You are gloating from the standpoint that you are American , living in the wonderful USA . The United States is in just as precarious a financial situation , Wall Street and US banks have adopted foolish and greedy business practices , just as bad as Enron , that have put the whole of the western world in financial jeapardy .
However much you think you have a right to say I told you so ; perhaps your eagerness to do so should be tempered by the fact that the USA is deeply in debt too .
As I endeavoured to say before , when your country is in a bad state ; it is comforting to see another country in a seemingly worse condition than your own .
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#97 Marcus
Somehow who goes ´belly up first´ is to me a minor detail.
The balance of the world´s wealth is moving from the US to China otherwise the US would not be complaining about the low Reminbi. (and already the low Euro).
For all the mental gymnastics I am more concerned that governments have BOUGHT the Sub-Crimes.
A transfer of wealth has occurred and crime pays ?
#93 Menedamus
Greece CANNOT print money, the UK can.
Borrowing money may assist fiscal responsibility ?
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EUpris
one of the things the EU does is streamlining degrees, diplomas and qualifications so that we can use them across the place.
Wouldn't you say that is something positive? A simple one word answer suffices.
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#62 Micklaus
When you say your government returned to " Old Form "; you mean reckless borrowing like in the 70s and 80s ?
I would say that Greece , Italy , Spain and Potugal did much the same .
It wasn't because any of you were in the Eurozone .
However I think that the Euro opened up possibilities to borrow and overspend .
I am only well acquainted with Italy . Italy was fine , though concealing huge debts , while it had the Lira and could devalue if necessary . Somehow the Euro currency gave a scope to let everything get out of hand .
The cost of living in Italy rose 30% in the first year ; I can only guess that wages and everything else had to rise too .
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Spain's debt is under 70% of GDP. It's problem is unemployment and a budget deficit, not indebtedness.
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Stephen Jones @#102
The problem for Spain is that as unemployment rises and economic growth stagnates so Tax Revenue - the bread and butter of a nation's national income - will decrease.
With Spain, unless their is a miraculous emergence of renewed economic viogour and economic growth, the Budget Deficit has to be reduced by austerity measures or be funded by more borrowings. If borrowings increase then the spectre of indebtedness will arise.
That is what the currency speculators are worried about in regards to Spain.
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quietoaktree @#99
There is nothing intrinsically wrong with a National Government raising loans to fund their public spending but where borrowing and existing debt grows to a point where it greater than revenue through taxes and economic growth then the loans and the debt becomes a problem as the cost of borrowing becomes to great as risk of being unable to repay increases worries for the lenders.
All governments see rises and falls in tax revenue and so borrowing sensibly can be a necessary action to meet their politically-motivated 'needs'. The question should always be asked whether those 'needs' are efficient and actually necessary. Most Europeans like to have welfare, social and health provisions provided for them and are happy to contribute taxes to pay towards those benefits ... the problem is that those provisions become more expensive to maintain year-on-year and, commonly, become less efficient as they are maintained by automated inflation-proof funding not cost-effective rationing nor self-sufficiency.
Thus, in regard to your specific question, "Borrowing money may assist fiscal responsibility?" - yes it can but how that borrowing is spent is of more vital importance.
The Greek government has had to finally admit that it was unable to borrow new funding on the open international financial markets and had to borrow from the newly-created Euro Fund but their borrowings are going straight to paying off pre-existing loans and debt interest payments. That can never be considered to be fiscally responsible as fiscal responsibility would have been not to have generated the borrowings without having the wherewithal, through GNP and tax revenue, to pay off the debt.
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The discussion has again deteriorated to Nationalism.
While CBW is polishing his medals, our problem appears to be whether the UK, EU or USA can print money more efficiently.
By that, I don´t mean MORE !
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The UK has spent many £bn GBP to support their economy and the failing UK banks but the national debt is still less than UK GNP and has a ratio of debt to income that is still far more economically sound than that of the GIIPS nations who have weak economic growth, excess of public spending vs. income and have debts that need to be repaid sooner rather than later - unlike the UK which has at least 13 years grace.
Meanwhile, the UK (and the USA) can borrow as much as they like and can print money that devalues their borrowings by devaluing their currencies.
That is what the UK has done successfully with "Quantitive Easing".
It is what the USA Federal Bank is trying to do but everyone seems to be ditching their portfolios of held Euros as Reserve Currency for the US Dollar and Gold.
I think the USA GNP is so huge that they can live with the unwanted love of the US Dollar which keeps the US Dollar value high vs. £GBP and Euro - unless President Obama really wants to screw up the US Private Sector much more and make the USA economy really, really European-like ... if that happens the US Dollar might sink without trace - just like the Euro is doing!
Still, the good thing for the Yanks is that their debts to China will be easily repaid as they will have Zillions of useless Dollars to give away.
Unfortunately, the Eurozone nations mainly owe one another's banks their national debt so they only get to screw one another if the Euro continues to become like toilet paper - plentiful but of limited use.
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#104 Menedemus
My argument is that printing money is the easier way out -- therefore more attractive.
The EU central Bank has more of a population to consider than either the USA or the UK and it is too early to say who has emerged the least scathed from this mess.
One thing is clear, Germany will NEVER accept inflation as a solution to such problems -- The USA and UK are more likely to do so.
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The Euro always was more of a political and less of an economic ideal. The concept that different countries with different interest rate needs and different economic imperatives could somehow function successfully where supposedly one interest rate policy would fit all, was likely to be doomed from the start.
Most German's - understandably - never wanted to trade the 'Mark' for the Euro right from the start. The newly formed Euro underpined by Germany became ever more shaky with the addition of new members with little appetite for fiscal responsibility. In good times the cracks went unnoticed, but with the recent sharp economic downturn it became evident that the King had no clothes.
Where the Euro goes from here will depend on how much Northern Europe's strong economies are willing to suffer economic disadvantage for a political ideal. If the political will is there then a combination of time and inflation will gradually reduce the debt ratio - but will likely take many years perhaps a whole generation.
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@ 72 JohnK
"Well this childish article doesn't explain why is the Pound Sterling in a deeper crisis that the Euro ! ! This just shows how Euro-skeptic Mr. Hewit is."
I wouldn't say the article is childish, just seen with Eurosceptic tinted glasses and very, very lax in terms of economics. I can only hope that, in the interests of balanced reporting, the next article on this blog is entitled "The case for the euro" as not everything is black or white, did you know Mr Hewitt? Things are more complex than may appear at first sight. As it has been highlighted before, for example Iceland, Hungary and Latvia are not in the Euro and have all experienced the same problems described in this article, and probably a lot worse. Could it be that they have been bedevilled by proximity?
This incidentally reminds me of how FBJ (John Redwood's representative on this blog, if my intuition is correct) kept relentlessly bullying Mark Mardell, the previous Europe editor, as he (FBJ) loudly complained that Mr Mardell had very much a pro-EU bias. As we haven't seen FBJ bullying Mr Hewitt, we can only assume that he has hit the right anti-EU bias/balance to keep FBJ happy.
In the interests of BBC's balanced reporting, I kindly repeat my request for Mr Hewitt to write his next blog as "The case for the euro". For starters he could try to work out how much British tourists/business travellers and importers/exporters would save if they didn't have to pay the bank racket every time they travel to / trade with other EU countries. He could also ask the hundreds of thousands of British pensioners living in the Eurozone whether they would sleep better if they didn't have to worry about the vagaries of the pound/euro exchange rate.
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kelby;
Europeans have always used twisted economic rationalizations to justify twisted political ideals. If their foresight was even a hundredth as good as their hindsight they'd have had far fewer regrets. Rather than be ruled by their often flawed logic, they habitually are ruled by their forever black hearts. They wind up getting the very fate they would impose on those they would condemn. They are getting what they had hoped would ruin America under Kyoto in spades. H, All I can do is gloat. BTW, the Arabs are in the same situation, they get exactly what they would condemn others to.
noisy little oak tree, who goes belly up first is anything but a minor detail. If Europe goes belly up first, America's success is assured by all of the business they will lose that will flow our way. I'm not going to teach you economics, just view some of my other postings to learn how China is to a large extent a subsidiary of Corporate America and not a threat. Nor are they a very rich country at all. They keep only 15% of what they earn. Much of the rest comes back to us.
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#108 Kelby
Your arguments are far from new !
The USA and the UK are clothed ?
With Marcus being a nudist ( he and Britain approves of Naked short selling), everyone is in the same sinking boat -- and Nationalism or trying to rescue oneself by pushing the other down into the deep, does not appear constructive !
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#109 JorgeG1
I see the topics chosen for this blog as mostly another flag- waving attempt to avoid a real discussion of Britain and all its problems.
I do not consider Mr. Hewitt as anyone who wishes serious criticism of the UK and its betterment.
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Re #96, 999, 105, 107, 111 & 112
Quote, "..did I miss something?"
Only between left & right ear.
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Jorge1 @#109
Are you suggesting that a currency like the £GBP is in crisis compared to the Euro? You wish!
The UK £GBP seems to be somewhat stronger than the Euro and that so despite every effort by the former UK Government to devalue the pound sterling and I note that, so far, that the Credit Rating Agencies haven't started to think of the UK £GBP as worthless like they thought the Euro was becoming worthless (and may yet still prove to be!) because of Greece.
If your measure of failure of the £GBP is currency exchange rates then I would still rather have fiscal control over the UK £GBP rather than surrender fiscal control to the ECB which is helpless in the face of sustained speculation of the Euro currency.
In any case, Exchange Rates are of little relevance at the present time as the £GBP is worth more than it was against the Euro so the exchange rate is more than offset by the strength of the £GBP. In fact, because the last UK Conservative Governmentremoved the UK £GBP from the European Exchange Rate Mechanism (albeit reluctantly because, as politicians, they wanted to show solidarity with the Euro!) that simple act has been the godsend for the UK Economy as we are even less dependent on the survival of the Euro.
If your measure of the strength of the Euro is that it costs more for the Brits to buy Euros to travel to Euro Disneyland then we can always take our holidays in Morocco, Tunisia, Turkey, the Maldives and even splash out and go to the USA.
I hope you don't mind me saying this - it is not my intention to offend - but the Brits really do not need to live in or visit Europe ... honestly, Europe is not that big a deal for the average British citizen and we can even stay at home which many Brits do! Life in Europe is not all that the Europeans crack it up to be ... I hope your not too upset by that let down, I know how easily offended Europeans can be when anyone suggests how insignificant Europe is in the World?
As to Brits who live in Europe and who suffer from additional costs due to the imbalance between the UK £GBP and Euro (much like my sister who lives in retirement in Vienna) - they gets their money and makes their choice to live abroad in an area where the currency devalues faster than I can tear toilet paper of the bogroll.
Actually, although my sister was hit by the deliberate devaluation of the UK £GBP in first instance because her pension is paid in UK£GBP (a problem deliberately created by the British government by the way and not a weakness of the UK£GBP per se) and so shrunk when exchanged for Austrian Euros) I am sure things are getting better now as the Euro is sinking in value faster than the UK £GBP can be further deliberately devalued.
For my sister's sake I actually hope the Euro continues to shrink in value against the UK £GBP. I am sure it will as some European (probably a Greek!) will see the business opportunity for selling worthless Euro Notes as toilet paper to the Third World and see that it makes sense to contine to devalue the Euro!
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#113
Brasso ?
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JorgeG1
See what I mean !
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To Menedemus (114)
From 1.1.1999 to this day...
British Pound per European Euro
http://tiny.cc/p5hrn
US Dollar per European Euro
http://tiny.cc/9g00m
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quietoaktree,
I perfectly see what you mean!
Among other things, not even someone who I know in this blog misinterprets my posts so comprehensively.
This in particular is a gem:
"I hope you don't mind me saying this - it is not my intention to offend - but the Brits really do not need to live in or visit Europe ..."
It is not my intention to offend? Do I really care where Brits go on holiday or emigrate to? I've got news for you: Not in the slightest.
This chap obviously hasn't read the statistics published by the ONS, the statistical arm of Her Majesty's Government of the United Kingdom of Great Britain and Northern Ireland.
I will quote them here to fill him in:
Travel statistics: Overseas Travel and Tourism - Quarter 4 2009 Crown copyright 2010
Table 18
Number of visits abroad by UK residents by area and purpose of visit (all modes) (thousands), 2009
Europe - 45,899
Total world - 58,433
A simple percentage calculation:
Percent of visits to Europe vs. world total = 45,899 / 58,433 = 78.5%
You really need to tell these 45.9 million Britons that they are wasting their time. At the very least they should always carry their flag with them, like UKIP MEPs do.
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Financial chaos. Finger pointing. It doesn't look like EU house is in order. In fact, EU idea is a bad one to begin with. Germany has more fiscal discipline than many others like France or Greece. EU fails to function as a single economic block. Period. I think until all members of EU can come to agreements with each other like states in the US, there should not be a union. People should go back to the beginning and use their own currencies like before, then they can float their currency appropriately to adjust with the unique situation of their economies.
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The best side won !
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Sir, in your article you refer to a group of countries as PIIGS, knowing, without doubt, that this acronym is considered to be offensive by citizens in those countries which are usually and derogatorily bunch together in much of the angloamerican press in conexion with the current economic crisis. Now, according to the rules of engagement in this forum, comments which:
# Are considered likely to disrupt, provoke, attack or offend others
# Are racist, sexist, homophobic, sexually explicit, abusive or otherwise objectionable
# Contain swear words or other language likely to offend
are prevented from being shown. The question goes to the moderator of this forum and I would like to have an answer: should not Mr Hewitt as BBC editor for Europe be reminded that in this article he is explicitely using " swear word or other language likely to offend"?. If I call him here a PIG would this comment be erased by you? I want an answer.
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Jorge1 @#118
I see that no one taught you any manners! Tut, tut.
Replying in the third person could be taken to be very insulting but I forgive you as you are not English and being foreign to these shores it must be hard enough to be polite as it is.
I think you will find that of the 45,899,000 visits from UK residents to Europe (please note: not necessarily Brits!) a fair proportion would be Europeans returning home - even they must go home for high days and holidays whilst spending more of their valuable time in the UK where life is so much sweeter and where people do not get troubled to show their passport or ID cards as they move freely out and about within the UK.
That is half the problem with the UK. It is better than the rest of Europe and the rest of the World hence people queue up at Calais to get into the UK rather than claim asylum in any of the other European nations they have travelled through to get to Calais.
On top of that, the UK is also full of EU Nationals who go where the life is so much sweeter than elsewhere in Europe.
One has to admit the UK must be like a honey pot for the rest of Europe and the World. Unfortunately for them, even those who manage to get into the UK for the work and better life must return home sooner or later – either voluntarily or by eviction – thus perverting your ONS figures which are a great example of there being statistics and numbers but also meaningless figures without being more definite as to who is visiting Europe from the UK and why.
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To Manedemus and other Southern Mediterranean bashers in this forum
As a Southern European PIG I would like to have some fun too. Let us give us some good time at the expense of those superior anglos and nordics:
- First, from the point of view of the average PIG it is not us but those TOXIC APES ( Anglo-Protestant Economies for those not in the know) the ones who are at the origin of the mess we are all in. Did Maddoff, Lehman Brothers, Norther Rock and the like happen in Madrid, Athens or Rome?
- Second, was it not the appalling level of greed, corruption, dismal risk assessment records and downright incompetence by regulators and operators alike in the City and Wall Street the main reason for the financial crisis? But of course, as a way of distracting everyone's attention it is easier to blame it on the Greek civil servant. After all he is another dark Mediterranean dago...
- Third, standing at -11,5% and 68%, the levels of budget and public debt in the UK ( not to mention in the US) are higher than, for instance, in Spain (11,2% and 53%). Besides, Belgium (96,7%), Germany( 73,2%), Austria (66,5%), France ( 77,6%), the Netherlands (60,9)and other nordics have higher public debts than Spain. Are they PIGS, APES or another kind of species?
- Fourth: as to the resurrection of the Northern / Southern Europe divide, well this is just a remake of the same old nonsensical Weberesque story about the superiority of Protestantism over Catholicism when it comes to running capitalism. And if so, what?. China and Equatorial Guinea are growing at a faster rate than the US, Germany and the UK, so should we infer that Confucianism and Animism are superior to Protestantism?.
- Fifth, all these articles and blogs written by anglos and nordics are full of the same storylines about them being responsible, over productive and so on and us Mediterraneans being little more than pampered children who have to be taken care of by real adults. Well, point taken. You in the North are the makers of history. And you know what? the results are not what you thing they are. Actually it was the competition for world domination between anglos and germans the single more important fact that led to two world wars. It was not the Latin races but those superior protestant nordics who are the cause for most of the bloodshed during the last century ( them and Slavic and Chinese communism). Responsible anyone?
- And this, sorry to be so frank, leads me to the miraculous Germans. Well, ladies and gentlemen, you like to say that you have been financing those Undermenchen mediterraneans who at the end of the day squandered your hard-earned money. To this here are some remarks: first, have you given back the moneis of the Marshall plan behind your economic recovery to the Americans? Answer,no you beggars,you did not, only the French under De Gaulle did for reasons of national pride. Second for every euro you have been putting on cohesion funds to the South you have been earning five via trade surpluses due to us consuming your goods instead of buying cheaper and most probably equally reliable non-German cars or refrigerators. From now on and as soon as we recover you can eat your cars with choucrut because we would rather buy Brazilian or Japonese or Chinese than German. Third, while Spain was abiding by the 3% Maastricht budgetary cealing you were running big deficits well above that limit in order to finance YOUR reunification and you know what? you succeded together with the French in arm-twisting the European Commission to look to the other side for five years without being punished for over-spending. The funny thing is that now you want to impose your obssesive anti-deficit behaviour on others only when it fits you...and all in order not to repeat the Weimar nightmare which was entirely of YOUR making. Fair enough?.
Finally to those thinking about expelling the South from the euro to be replaced by a Nordic euro-core. Well, think twice: Italy and Spain are the seventh and ninth largest world economies. Spain is the sixth largest world investor ( the second in Latin America, the fourth in the US and the second in the UK according to 2008 OCDE statistics). Together we are around 100 million consumers and both Italy and Spain have excellent multinationals which are simply first class ( ENI, Generalli, Santander, BBVA, Telefónica, Zara, Iberdrola, Acciona, ACS, all the Milan- based small and medium sized exporting firms...). So do you think Germany and maybe France are going to compensate that loss with the likes or one or two Scandinavian non-entities plus those economic giants: Belgium and the Netherlands?
All this said...let us respect each other.
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JukkaRohila @#117
I would pay attention to the right hand timeline in both Charts of the value of the Euro from 2009 onwards against both currencies.
That is when the Euro was caught out and the Greeks admitted the open secret that their economy was not as sound as had been documented. From that moment on the Euro has been found out to be a currency designed by politicians and built upon the quicksands of high hopes and expectations and now seen to have no foundations other than the hope that Germans will bail out the rest of the Eurozone when their economies also struggle like that of Greece.
From 2009 onwards all currencies have devalued and economies have suffered but it is vbery noticeable that the very charts you show to 'demonstrate' the strength of the Euro also shows that the strength of the Euro is now substantially diminishing, and quite rapidly so, against both the £GBP and $US.
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This is the same old tired narrative of the events, which puts all the GIIPS in the same bag for sake of lazy simplicity as if there weren't big differences between these countries. You can stick to your narrative of the events all you want but that doesn't make you right even if you keep repeating it.
Spain has the lowest public debt to gdp ratio in western europe, will that ever stick in your brain. Their unemployment rate is high but it's not because of the euro. It was extremely high before the euro and it was around 9% just before the bubble burst. It has to do with their antiquated labor laws. They do have a competitiveness problem which explains their unemployment rate but that's not new either.
Ireland has good fundamentals which will propel her growth once the crisis is over, no doubt about that either. Italy has a very high public debt to gdp ratio but italians have one of the highest savings rate in europe which means they owe a lot of money to themselves which isn't a bad position to be in. Portugal is well ahead of everybody when it comes to social security reform, which explains why their public spending is predicted to grow only a little bit more than germany's in the medium to long term. Their debt level is about the same as germany's and france's but let's not forget that it's pretty much good debt as their infrastructure is now in very good shape and let's not forget that this cycle of infrastructure building is coming to an end around 2015 and then go down quite rapidly relieving their public finances. Greece is the bigger problem but let's give them credit for taking the bull by the horns. Having lived in the US for a number of years I can assure you that nobody in America would accept a 20 or 30% cut in their salaries. In my own state of NJ the governor is in a lot of trouble for pushing for a temporary pay freeze.
As for the competiveness issue I think you're making too much out of it. The minimum wage in Portugal, for example, is less than 500 euros. If that's not competitive I don't know what is. With the exception of Spain the other GIIPS seem to have an unemployment rate around the EU average so I don't think wage competitiveness is really an issue. There are many factors that influence competitiveness and all european countries are gonna have to work hard to improve those.
Also let me remind you that there were no property bubbles in Portugal or Italy (not sure about greece). Property prices in Portugal have been stable for the last decade and the banking sector is sound.
Finally why isn't anybody focusing on California, Arizona, Florida and Nevada which also had huge property bubbles and the last time I checked there wasn't anybody in these states wishing they had their own currency.
Let's get real. This is not about textbook economics. This is about a number of people that are against the euro based on politics, geo stratetigic positioning, ideology, national pride etc etc
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100. At 3:54pm on 12 Jun 2010, Gheryando wrote:
"EUpris
one of the things the EU does is streamlining degrees, diplomas and qualifications so that we can use them across the place.
Wouldn't you say that is something positive? A simple one word answer suffices."
EUpris: A one word answer would not suffice. A short answer will not suffice. Unfortunately I have not got the time for a long answer.
Here an insufficient short answer:
1) There are many possible ways of cooperating sensibly. Cooperation on qualifications is possibly one way. There are substantial difficulties with that. We do not need the "EU" to cooperate. On the transportation of hazardous materials by road we have what seems to be very sensible cooperation through the ARD system. It may be that there is some sensible cooperation going on which is funnelled through the "EU". It would probably be better if the "EU" and the "Europwea Idea" were not involved and did not exist. We do not need an "EU"-parliament to cooperate on diplomas.
2) My suggestion is that there should be more dual qualification e.g. a British and a German university cooperate and students who attend both universities get qualifications from both universities. That does not have to have anything to do with the "EU" or indeed with Europe. Such arrangements could be made between a British university and an American or Japanese university.
3) Reports of bribery in Italian educational institutions make the recognition of foreign qualifications very problematic.
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http://blogs.telegraph.co.uk/news/normantebbit/100043259/what-cameron-should-tell-obama-about-bp-%E2%80%93-and-gary-mckinnon/
Over at the Telegraph Norman Tebbit wrote:
"...
Like ‘hagar’, I am incensed, but not surprised that the EU should be gathering information about extremists, by which they mean opponents of the proposed neo-fascist Euro republic. ..."
Can anybody tell us more about this?
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If there is a gEUstapo gathering information on dangerous extremists then I have a list of names:
Blair, Brown, Milliband, Clegg, Merkel, Sarkozy, Barrosso, van Rumpoy, Ashton.
Unfortunately it would seem that every judge in the "EU" should be on this list because they should all have resigned over the imposition of the Lisbon Treaty.
An opponent of the "EU" is unlikely to get justice in any court in the "EU". With the Lisbon Treaty "EU"-lovers did not merely abolish democracy in the "EU". They also abolished justice.
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#123 Hispanicus
Wow, that was an explosion !
I do not know how old you are, and if you lived through and appreciated the last 40 years of Europe´s history.
The high cost of German re-unification was only a part of the problem. Without German re-unification the map of Eastern Europe would have been much different. The Cold War was ending and a re-united (wealthy) Germany allowed the East to choose Nato and another ideal (instead of Communism). The Brits ( Thatcher) almost scuttled their Freedom and their entry into the European sphere of influence by using the same anti-German tone as you yourself.
In the 70´s Spain and Portugal were emerging from the scourge of Franco and Salazar, Britain was bankrupt (until they discovered Scottish oil and then privatized it) , Italy was going from one devaluation to the other and Greece was beginning to move its economy from olives to tourism. And all the time Germany was expected to be the Paymaster -- and it did not cringe from the responsibility.
Sure you can buy non-German products but do not forget YOUR history as others on this blog conveniently do !
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Hiccupicus;
You are right about the illusion of the German and French economies. If you are Germany or France, your banks lend someone money to buy your overpriced products you know they will never pay you for and the cost of producing them is tallied up as part of your GDP while the export price is called part of an export surplus. Now you have to lend them more money to pay back the old debts and hope that they can close the gaping cravass between what they earn and what the owe with a 5% government budget cut so they can pay you back on the new loans. What a joke. Markets aren't fooled forever. Sooner or later this absurd Euro will die.
The disaster in the financial markets didn't create the government budget problems for Europe and America, it merely accelerated the time when they would manifest themselves. The lack of credit to continue borrowing to finance government spending that can't be paid for is the underlying cause of Europe's woes. If it hadn't happened now it would have happened five or ten years from now but it still would have happened. The difference is that investors are begging the American government to borrow their money at zero interest for safe keeping while they are increasingly shunning lending any more to European governments.
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#127 EUPris
Your apparent intelligence has not supplied the answers you require ?
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#130 Marcus
Take a tranquillizer !
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129. At 11:21pm on 12 Jun 2010, quietoaktree wrote:
" ... Germany ... the East. The Brits ( Thatcher) almost scuttled their Freedom and their entry into the European sphere of influence ..."
EUpris: I doubt if that is correct. The GDR could have become democratic and prosperous without reunification.
Helmut Kohl used to get quoted as saying that European integration was like German reunification. To some extent it was. Both were unnecessary and incredibly expensive.
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Re 126.
Apologies. I believe it its the ADR system.
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The Süddeutsche Zeitung (South German newspaper) refers to Geert Wilders as a "Right wing rat catcher."
So presumably, in their "EU"-lovers heads, those who agree with him are rats!
The SZ is very pro-"EU". I suppose it tells us what many committed "EU"-lovers think of those who disagree with them. It tells us which way the "EU" is heading.
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#133 EUpris
It is correct !
You obviously did not see ANY of Eastern Europe (and GDR) before German re-unification. There was no way they could go it alone.
The Brits and Thatcher were prepared to sacrifice them and Europe´s security under NATO.
America was finally able to knock sense into Britain´s head, but it showed to the World Britains´ Delusions of Grandeur --- which you so un-eloquently demonstrate.
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@110 MAII
"noisy little oak tree, who goes belly up first is anything but a minor detail. If Europe goes belly up first, America's success is assured by all of the business they will lose that will flow our way. I'm not going to teach you economics, just view some of my other postings to learn how China is to a large extent a subsidiary of Corporate America and not a threat. Nor are they a very rich country at all. They keep only 15% of what they earn. Much of the rest comes back to us."
Of course you aren`t going to teach him economics as you have no notion of it.
If you had, you wouldn`t spout out such nonsense in all your postings.
Example:
"But if we hold out long enough, Europe will go broke first. Their interest rates they pay out are much higher because the market doesn't trust them. They will either print money to deflate their own currency or face endless depression which may come anyway."
Increasing the money supply does not cause deflation, but the opposite.
It also does not qualify as a tool to prevent depression.
Next example:
"You are right about the illusion of the German and French economies. If you are Germany or France, your banks lend someone money to buy your overpriced products you know they will never pay you for and the cost of producing them is tallied up as part of your GDP while the export price is called part of an export surplus. Now you have to lend them more money to pay back the old debts and hope that they can close the gaping cravass between what they earn and what the owe with a 5% government budget cut so they can pay you back on the new loans. What a joke. Markets aren't fooled forever. Sooner or later this absurd Euro will die."
Money is lend by private institutions such as hedge fonds and not by governments. Your claim that Germany provides loans to other nations to buy the products in order to increase it the German GDP artificially has zero credibility.
Don`t be a hater just because your beloved USA don`t have a high savings rate.
Instead, just go to a library and look for "economics for dummies".
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#135 EUpris
Yesterday I attempted to give a link to a blog that said it had WITHDRAWN Fitna. The BBC AUTOMATICALLY refused to accept my contribution quoting PROFANITY.
I think that shows a more ominous British trait, if a contributor cannot point to a non-event without being censored !
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@135 EUprisoner
"The Süddeutsche Zeitung (South German newspaper) refers to Geert Wilders as a "Right wing rat catcher.""
Nothing else to expect from that goody two-shoes paper.
I never understood why that newspaper is so reputable.
Even the BILD is more impartial.
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111 QUIETOAKTREE WROTE
108 KELBY - Your arguments are far from new
What is your point quietoaktree ? - that old arguments should be dismissed as wrong just because they are not new ?
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Drugstore man;
"go to a library and look for "economics for dummies"."
I did. That's where the model for the European Union came from. It was their roadmap. Little wonder it terminated in a dead end.
"Increasing the money supply does not cause deflation, but the opposite.
It also does not qualify as a tool to prevent depression."
Increasing the money supply deflates the value of each unit of currency causing prices, interest rates etc. to rise in respones. Demands for salary increases too. The value of the currency itself is deflated along with all debts owed at a fixed interest rate. As more money flows into the economy it becomes more readily available to buy things, to invest, to pay wages, to pay off debts, to pay taxes, to lend, and in short to start things moving. It is the tight money supply that prolongs recessions and depressions. The US has already said it will not print a lot of additional money. We'll see just how long it can hold out. When its debts come due and it has to pay up, it will either print money or tax its people deeper into recession and depression. I say it will print it. Higher taxes here would be political suicide for anyone, even Democrats. That is how the great depression really ended and how every recession ever since ended, by increasing the money supply. The longer the US government waits, the surer Europes demise will be. When the increase of the US money supply finally comes and with it inflation of prices and wages, it will be best if it comes all at once. What markets hate is uncertainty. If they woke up one day to find a sudden paradigm shift in the value of the US dollar, after the brief hullaballoo they'd quiet down and adjust rather quickly. What else can be done with an economy whose government alone is 14 trillion dollars in debt?
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There is a consequence of printing money or increasing money supply that is a big consequence. Price Inflation usually follows on from the insertion of more money into an economy.
The UK has used "Quantitive Easing" but, as a sign that the UK economy is still very weak the results have not been yet filtered through to any inflation simply because, uniquely with this recession, the banks have been gaining much of the extra money but not passing it on to their private, corporate or personal customers (as the government would have liked!). Those customers would have spent that money before now and started the reflation the UK economy needs quite desperately as UK economic growth is currently anaemic at best.
Perversely, the UK government created the extra money and gave it to the UK banks but the banks, in the main, have stockpiled the money as collateral in case there is further financial catastrophe - the need for set-aside being demanded by the very same government that complained when the banks didn't pass on the new money in the form of investment or new loans.
I suspect the Banks are now being ultra-cautious but I am thinking that they, the Bankers, perhaps know a lot more about our global future financial prospects than the politicians do. Perhaps a double-dip recession could be on the way?
However, that may only be part of the problem as there are still a lot of individuals and small-to-medium sized firms in the UK that are struggling with the shortage money supply - existing debts and mortgages being impacted by rising employment and new loans and private sector investment (desperately needed to invigorate economic growth!) being almost impossible to obtain except at interest rates far much higher than the Bank of England Base Rate.
Still, I'd rather have the option that the USA and the UK have which is to increase money supply indefinitely - if needed.
Increasing money supply in the Eurozone is something the Eurozone nations can only do by lending more government-guaranteed money after bad debt - a sure-fired recipe for more economic woes and only affordable if the politicians squeeze the pips out of their citizens to be able to guarantee the lending if the borrowing nation does default.
Still, no doubt the citizens of the Eurozone will enjoy paying for the Greek economic woes, being unemployed in Spain and Portugal and loving all the austerity measures that will be imposed right across the Eurozone ... part of the joy of having led la dolce vita and being Eurozone citizens.
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#109 JorgeG1
The Euro is a political construct for a purely political purpose ; a step towards a total federal union .
If you impartially analyse the Euro from a purely economic point of view ; there isn't a case for the Euro .
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85. At 12:45pm on 12 Jun 2010, DurstigerMann
I am not an economist and I do not need or want to open any economy book.
I was talking about something and you understood something else.Your argument with the overspending appears more like a copy/paste action from a tabloid. I hope you are not an economist.
The so many expert economist out there appear to me that their are good just to receive immense salaries for advice that's worthy something next to zero.
I suppose that governments have a bunch of economy experts to advice, monitor and build financial policies. Since almost all governments in Europe are almost broke I think they should reconsider their panel of so called economic experts.
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Time for some resounding platitudes :-
economists are wrong, have always been wrong, and always will be wrong but that doesn't mean that they never have good ideas
among economists, as among other groups of clever people, are a few very wise people who recognise the limitations of their subject and a lot of very unwise people who don't
the ideas of the former are invariably more useful to the rest of mankind than those of the latter, but those of the latter (eg Freedman) are generally favoured by other economists - until discarded in toto and replaced in their estimation by the latest piece of fashionable hocus-pocus
the Founding Fathers thought that they had invented a perfect human institution in the shape of the American constitution, which was mainly based on Locke's political philosophy; they were wrong because the philosophy itself was (like all philosophy) conjectural not a blueprint
there are no perfect human institutions because there are no perfect human beings; all human institutions are messy and full of contradictions and compromises
the first 75 years of America's history were dominated by two struggles:- between the federalists and the states'-righters and between the industrialising North and the agrarian, slave-owning, South; both struggles culminated in the Civil War which the North won, despite the fact that the South had many more good commanders, principally because of the inspired political leadership of Abraham Lincoln (see: the Gettysburgh Address)
the first few decades of the EU has also been dominated by a struggle between federalists (wanting "ever-closer union") and states'-righters (wanting nothing more than a common market within a customs union)
like the Confederacy, the European states'-righters would prefer that the union be destroyed than that the federalists should get their way
like most grand projects the EU was inspired both by lofty ideals and by pragmatism (read: self-interest)
what it sought to replace, namely destructive rivalry fuelled by nationalism, had not been shown to be a remarkable success nor a prescription for economic prosperity or general human happiness - for any of the countries of Europe
ergo, the EU was in principle "a good idea"
for the same reason, it still is
nationalism is not going to go away but its effects do not have to be destructive, provided they can be constrained within the bounds of reason
that is what the EU's institutions are aimed at doing; they will never succeed completely but that will not mean that the whole idea was doomed
the same arguments apply to the common currency in principle but the problem is that it has been (self-)imposed upon a political structure which was not ready for it; the Growth and Stability Pact was a German/Bundesbank attempt at a substitute for the necessary political structure - it didn't (and couldn't) work
sniping from across the Atlantic (or across the Channel, which is much the same thing) will not bring down rhe euro and there is - depite the doomsters (economists again!) - probably enough economic strength in Europe to preserve the euro provided the necessary political will can be maintained
however some countries undoubtedly ought to do themselves and the others a favour by leaving the eurozone (just as Britain was forced to do, although then it was the EMU); they can re-join if they wish once they've sorted-out their problems (which leaving it now would permit them to do faster); only stupid (nationalistic) pride stops them seeing this
there are countries now outside it (eg Estonia) which have already adopted the necessary political and fiscal disciplines to be eminently suited to join it and because they perceive it to be in their own best interests are eager to do so; this is no empty gesture and it should tell us something positive about the common currency idea
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Re: 138. At 01:48am on 13 Jun 2010, quietoaktree
I accept that the BBC is not perfect. Apart from myself, what is?
However the range of comments allowed here is far broader than that allowed on German language blogs that I have seen.
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145. At 09:32am on 13 Jun 2010, torpare wrote:
" ...
what it sought to replace, namely destructive rivalry fuelled by nationalism, had not been shown to be a remarkable success nor a prescription for economic prosperity or general human happiness - for any of the countries of Europe ..."
EUpris: The "EU" is about nationalism. Its "nation" is the "EU" or "Europe." "EU"-lovers accuse people like me of flag-waving but "EU"-lovers wave their flag all the time. The rotten thing is on my driving licence. The rotten thing has been seen above the town hall here. The rotten thing was waved in outer space by some "EU"-loving astronaut. I have seen the rotten thing on projects in Ireland. I have seen the rotten thing all over the place.
Switzerland has done very well out of being independent.
" ...
ergo, the EU was in principle "a good idea" ..."
EUpris: No!
"for the same reason, it still is"
EUpris: For the same reason it still is not.
"nationalism is not going to go away but its effects do not have to be destructive, provided they can be constrained within the bounds of reason
that is what the EU's institutions are aimed at doing; ..."
EUpris: They are aimed at creating a Greater European Reich against the known wishes of millions of us who are its prisoners. It could lead to wars of independence,. More US Americans died in their Civil War than in WWI and WWII together. I think you can throw in Vietnam as well.
The arrogant arrogant, anti-democratic, megalomaniac "EU" is trying to build up its armed forces to a situation which would enable it to carry out wars of aggression without the consent of its people. Dangerous!
"...
the same arguments apply to the common currency ..."
EUpris: Which is why that too is rubbish.
"...
sniping from across ... the Channel..."
EUpris: We are not across the Channel. You are!
"... will not bring down rhe euro..."
EUpris: I don't want to bring it down. I find it very handy when I go on holiday. I don't want to be part of it.
" ... only stupid (nationalistic) pride..."
EUpris: Describes the "EU".
"...
there are countries now outside it (eg Estonia) which have already adopted the necessary political and fiscal disciplines to be eminently suited to join it and because they perceive it to be in their own best interests are eager to do so; this is no empty gesture and it should tell us something positive about the common currency idea"
EUpris: We cannot know if the Estonians want to join unless they have a referendum. Are anti-democratic "EU"-lovers going to let them have that?
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145. At 09:32am on 13 Jun 2010, torpare
That is an interesting point of view which I mostly agree with. However, I do not think that is a good idea if any country is gonna leave the Euro to sort its financial problems. That just looks bad and sends a bad message: we are with you when you are doing well, we do not want you when you are doing bad. Sounds odd to me.
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The most valuable currency most sought after besides the US$ was the deutsche Mark. According to a report of the bundesbank in 1997 the worldwide monetary reserve was allocated to
the $ by 62,7 %
the DM by 14,1 %
the yen by 7,0 %
the sterling by 3,2 %
the french franc by 1,7 %
the swiss franc by 1 %
The most successful national economy in Europe was the german one.
The DM was constructed by the Bundesbank-act which defined the stability of the currency as the bundesbank's sole and premier objective. The bundesbank was installed as an independent institution, not subservient to politics and it's short sighted demands. Economic policy - that is the idea - should not, must not be proceeded by means of monetary policy.
When Germany gave up the deutsche mark in exchange for unity they managed to put across the principles sketched above to the Euro.
Where did the economies get that had the "competetive devaluation" in their manuals ? Except you can live perfectly limited to a local market like te USA, there is no "competetive devaluation". Devaluation expropriates the people without letting them know. It is nothing else but a conjurer's cheat that leads to nowhere.
Experience lectures that stable currencies prevail. Or big ones. Better both.
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Still the Euro continues it's inherent difficulties and still it's lovers continue to deny the obvious and what was apparent from it's outset just as Hewitt has written here. It was always an accident waiting to happen when so many dissimilar economies were allowed to join and the convergence rules totally ignored in the face of political expediency.
On another matter, I saw today that my Belgium is about to assume the EU presidency next month, this from a federal devolved government country that is voting today to see whether it can somehow find a coalition to keep political opposites from the two language sides together in government. A BBC report today has the opinion that the separatist Flemish party NVA will do well. I simply look at what I see and hear here and think that it's not only a matter of time before Belgium disappears, but also the EU in it's current form will suffer the same fate since the problems of Belgium exist throughout the EU. I also wonder how avowed federalists like Van Rumpoy can carry on promoting his dream of a federal EU when his own federal country is haemorrhaging and proving that it's a disaster.
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#146 EUpris
That´s because it is accepted most Brits have an extremely short memory span. The BBC takes this into account for humanitarian reasons.
I am pleased you acknowledge the difficult work of the Moderators and your own limitations !
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@ 143. Huaimek
"If you impartially analyse the Euro from a purely economic point of view ; there isn't a case for the Euro ."
So where is this impartial analysis? In this BBC blog perhaps?
For starters, an impartial analysis weighs pros and cons. All the Europhobic analysis of the Euro includes real and (mostly) imaginary negatives, but not a single positive to be seen. That includes Mr Hewitt's articles.
No human construct is perfect. There are always pros and cons.
I can see negatives in the Euro all right, but I don't think I need to repeat them here. Some of them had been repeated ad nauseam by the anti-EU brigade.
I can also see at least two economic cases for the Euro, never, ever mentioned by the Europhobes:
- A macroeconomic one – In a single market of 30 nations it makes sense to have as few individual currencies as possible. One currency, or if that is impossible, a handful of currencies is a lot better than 30. A single market with 30 currencies cannot ever work.
- A microeconomic one – If a country does 50% of its trade with a group of countries which share a single currency and two thirds of its travel destinations are to the same group of countries that share a single currency, joining that single currency would save a colossal amount of money in foreign exchange fees and commissions, currency hedge arrangements, etc. That money could be then used productively, for example to rebuild the British economy rather than feathering the bankers' nests.
All Europhobic assessments of the two key pillars of European integration follow the same pattern:
State the negatives (strictly just the negatives). Blow them out of proportion. Say that this is just part of a conspiracy to create a totalitarian superstate. Predict imminent collapse.
You can see a token example in the article linked in my post no. 39 above (in case you need more examples as Hewitt's blogs about the euro follow a similar pattern).
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@6 cool_brush_work
With all my respect, I should avow, though with much regret, that this time, the analysis of Gavin Hewitt is correct and explicit. His general conclusion that the relatively “cheap” and accessible credit money that boosted many economies of the euro zone, doubled by the big differences in the economic, social and industrial level of the so called PIIGS countries, compared to the mighty and well managed economies of the North, inevitably led to the investing in non-productive projects, in corruptive practices and finally in their gradual dept increase and, consequently in the devaluation of the single currency.
I should add to the Hewitt analysis that the unequal economic development of the newly admitted states from Eastern Europe, contrary to many naïf expectations, could be another unpleasant surprise both to the single currency and to the European Union itself.
What I mean is that all those countries were too quickly involved in the integration process without any preparation, with their low technological level, poor infrastructure and corrupt state and local administration. Hence, the inability of the said countries to utilize correctly and efficiently the European funds and the real risk to devaluate even more the single currency as soon as they enter the euro zone.
To that matter, I should also agree with your comment that the general pro-European idea of a successful management of 27 disparate nations by core supreme authority might prove to be just another failure, if not supported, approved and revised by the majority of the citizens inhabiting the member states. /Mind I call them member states, and not nation states/.
Here comes maybe the main discussion which inevitably will turn around the efficiency of the Lisbon treaty. Who represents who and how…
Sofia, June 13th 2010
P.S. The day is marked here by the inauguration of the Garibaldi’s monument in the mere centre of the capital by the PM's of Italy/Bulgaria and by the concert of Elton John, scheduled for this evening
Regards
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@122 Menedemus
"even they must go home for high days and holidays whilst spending more of their valuable time in the UK where life is so much sweeter and where people do not get troubled to show their passport or ID cards as they move freely out and about within the UK."
A rose tinted assessment that seems to be contradicted here:
Endemic surveillance society:
http://www.privacyinternational.org/article.shtml?cmd[347]=x-347-545269&als[theme]=Privacy%20and%20Human%20Rights
British more anti-immigrant and xenophobic than rest of western Europe, survey suggests
http://www.guardian.co.uk/uk/2009/dec/03/british-against-eu-immigration-powers
Of course there are positives as well. Every person/country/political construct has positives and negatives.
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Hispanicus & #123
Enjoyed reading that: Some interesting and new perspective which You presented in fair detail.
The 'south' of EUrope most certainly has a past and future that does not necessarily include attachment to the north's EU. For sure, 'south' or 'east' being beholden to the 'north' (inc. UK/England) as some have implied on here is Economic-Fiscal sophistry. Historical evidence reveals the declining, stagnating 'west' (as Mr Hewitt's article clearly illustrates) needed the 'expansionist' movement as much if not more than either the post dictatorship-Iberian Peninsula or post-Soviet East Europe.
Proponents of the 'it was all the generosity, skill & investment of the EU' that brought about increasing economic progress & prosperity are far too inclined to forget or ignore that from such low bases the newly freed 'south' and 'east' were bound to rapidly develop with or without the 'west-EU'. Brussels undoubtedly assisted, but there is nothing to suggest the Economic recovery would not have, albeit more steadily, taken place in any event.
'Pro-EU' are always at the forefront of proclaiming what the EU achievements have been: Remarkable how they find any faults or upsets (e.g. 15 EUro-zone Nations struggling with a World recession made worse by corrupted original Entry qualifications) are always originating from the member States and never anything to do with Brussels!
It is very unfortunate that Spain has been so beleaguered despite its adherence to Brussels-EU regulatory measures. It is perhaps an indicator to You that too much reliance on the centralising EU authority is never a healthy political and/or economic policy for a Nation wishing to retain some degree of sovereignty and flexibility in its actions (in that sense the UK/England demonstrates its preference for looser ties).
You rightly point up the political corruption at the core of the EU that had allowed years of fiscal chicanery by supposed upright founding Nations (EU & EUro-zone), e.g. Germany, France which is now ignored as they press for other Nations to take up constraints they themselves broke at will in the past.
Again, I would suggest it is an indicator of Spain perhaps stepping back and not placing all-its-eggs-in-one-basket as it did in former years with Brussels.
As You say, Spain is a large and significant Nation in its own right: Why then would it alongside Portugal not reconsider its EU-role and adopt the more cautious line of the UK/England? Certainly the wholesale acceptance of Brussels' intervention in the last 2 decades is presently demonstrably not the boon Spain's Citizens may have thought it would be.
I must add:
Note the contrast between your careful and considered salient points and that of #129 wholly lacking in verification or any substantive factual basis.
By all means join with others on here in dismissal of the supposedly lofty contributor at #129 who in truth has become a bit of a weak joke for his/her paucity of substance and uninformed antipathy toward the UK.
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@94 MAII
"List every single reason for an against for both. When you're done, hold the paper at a distance? Do you see the lists on the two outside columns very long and the lists on the two inside columns very short? That is why even German companies are building in China. BTW, depending on what the nature of the product happened to be, if one of those two columns was America and the other China or Germany, in all likelihood, the decision would be far less clear cut."
Since I know a little bit about how things are run in China, I don`t think that the decision is quite that clear cut.
Germany has the problem of overregulation which makes it not very attractive to start a business or a new facility, you are right.
For that purpose, I would probably choose Taiwan.
I know that things are not perfect here. But I also know that there are people who want to change it.
However, I would never open a factory in the PRC if I was looking for product quality. Taiwan is an alternative, but imo there is no reason not to produce in Germany or the USA other than higher revenue.
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@144 opinion
"I am not an economist and I do not need or want to open any economy book.
I was talking about something and you understood something else.Your argument with the overspending appears more like a copy/paste action from a tabloid. I hope you are not an economist."
Yes I do study economics ;))
And I didn`t copy and paste anything rest assured. I don`t need to copy anything from a tabloid to know that making debt is not what a government should do.
And I like to give easy to understand examples. Doesn`t make you sound smart to a lot of people, I know.
But maybe you could give me some insight on how my argument makes no sense economically.
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@15 Menedemus
“…and there is a strong possibility that demands by citizens of the PIIGS nations will rise for the PIIGS nations to leave the constraints of the Euro and return to their own currencies and their own way of life not driven by constraints imposed by the IMF, the ECB and the German Chancellor.”
I should agree that the servicing of the loans given by the ECB under the supervision of the Brussels institution does represent a fiscal burden for the PIIGS member states. But that fact does not necessarily mean that we should qualify the legal conditions of lending the said loans just like constraints imposed by the ECB and Frau Merkel...
I know that what we lack is a more efficient and preventive monitoring over the conditions of landing and investing under the European projects, which leads inevitably to the idea of an independent court of justice and maybe to the necessary “refurbishment” of the Lisbon treaty protocols concerning the single currency and the landing of centralised money funds.
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82.RantingMrP wrote:
The answer seems rather obvious: allow Germany to run a federal, united Europe, both politically and economically. The problem goes away. Oh - you might have to kick the UK out to achieve this, but Europe won't miss the Brits much, will they?
I think I spotted the flaw in your plan. The peoples on the continent aren't in favor of this, either. Only some politicians are. Please desist from pushing the delusion that those on the continent support more integration in the undemocratic EU, because we don't.
mvr512 (Netherlands)
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136. At 01:33am on 13 Jun 2010, quietoaktree wrote:
"#133 EUpris
...
You obviously did not see ANY of Eastern Europe (and GDR) before German re-unification...."
EUpris: 1962 Hungary
1968 Bulgaria and Yugoslavia
1970s Czechoslovakia several times.
" ... There was no way they could go it alone. ..."
EUpris: I did not say that could have gone it alone. We could have helped them an awful lot without German or European integration. We should have done so directly without funnelling money through the worse-than-useless "EU".
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@155 cool_brush_work
"You rightly point up the political corruption at the core of the EU that had allowed years of fiscal chicanery by supposed upright founding Nations (EU & EUro-zone), e.g. Germany, France which is now ignored as they press for other Nations to take up constraints they themselves broke at will in the past."
I don`t want to dispute your point, because I generally agree.
Even if German leaders didn`t know just how much reunification would cost back at Maastricht.
Kohl and Mitterand were both mistaken at evaluating this factor.
Nevertheless, in a perfect world, most nations would take up constraints themselves. So far no nation did.
So I am happy that the first nations are starting now to implement measures, albeit imperfect ones.
When I look at the Euro, I get a mixed feeling.
The other nations should not be forced undemocratically to implement constraints.
But on the other hand you cannot sustain a common currency if one part implements austerity measures in order to reduce debt and the other keeps spending and increasing debt.
So the big European nations should go ahead and be role models for how to get the budget in check and other nations will follow if they see that it is a success.
However, for that to happen we need to get rid of attitudes like "but you broke the Maastricht criteria so why should we save?".
A balanced budget is nothing you want because someone else has it, but because it is for your own good!
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@123 Hispanicus
"And this, sorry to be so frank, leads me to the miraculous Germans. Well, ladies and gentlemen, you like to say that you have been financing those Undermenchen mediterraneans who at the end of the day squandered your hard-earned money. To this here are some remarks: first, have you given back the moneis of the Marshall plan behind your economic recovery to the Americans? Answer,no you beggars,you did not, "
Germany is expected to pay the last 56 millon euros of WORLD WAR I reparations by 3 October 2010.
That`s right, 92 years after the great war, my nation is still paying for the unjust trearty of versailles which paved the way for WWII.
As for the Marshall Plan:
It had a grossly overstated economical impact.
Resources, infrastructure and technology taken from Germany by the Allies surpassed its worth by far.
The Marshall Plan was an attempt to bring Western Europe under US-influence and to incorporate them into the Bretton-Woods system.
This didn`t happen as European nations rather looked to their neighbours than to America. A strongly emerging France with people like De Gaulle and Schuman planted the seeds for a Europe under French influence that would hold its own despite the strong connection to the economically and militarily overpowering USA and gernal anglo-saxian dominance of that time.
What would have been better is for everyone to decide on his own.
Personally, I would rather thank the Americans for the raisin bombers over Berlin than for the Marshall Plan.
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generalissimo
Re #153
Strangely Your piece on Italy etc. coinciding with my #155 concerning Spain etc. are concerned with the unpalatable facts surrounding the expansion of the post-Maastricht EU.
Of course Mr Hewitt's Article is not the final word on the subject: Nevertheless, those describing it as 'childish', attacking its content as 'weak analysis' when it is directly quoting from the distinguished & important Carnegie Report (the paper is indeed "...rich in data.."), or demanding an article on the 'benefits of the EUro' just shows what a raw nerve of anxiety it has struck among the 'pro-EU'!
Some of the complainants seemed to have overlooked that he does include the ailments of the non-EUrozone States in previous Articles and should not have been surprised by the content of a piece entitled, 'The case against the EUro'.
What is even more unaccountable is that none of those finding fault with the report ever mentioned its inadequacies on previous occasions when it was not critical of the EUro-zone!? A similar EU-denial dogma is applied to anything that goes wrong within the EU: It is according to Brussels always the fault of the States - - E.g. reading on here the 'pro-EU' apparently the Economic progression of 'East Europe' was all the responsibility of the EU, but, the recent years of difficulty in the East are all because of the individual Nations' Governments - - thus, when the EUro-zone thrived the Currency was built on sound Brussels-EU regulation & expertise, but when it is seen to be floundering why that is all because of 'foreign speculators' and 'foreign Credit Rating Agencies' although both were there doing their stuff through the inception & stable EUro Currency years!?
Personally, as I wrote at #6 even I, a full-on critic of the EU, had not "..grasped just how bad things had become in the rotting EUropean Union..".
I suspect that Mr Hewitt's Article highlighting the independent Carnegie Report came as an immense shock to a good many 'pro-EU' and as ever they cannot face reality so try to besmirch or shoot the messenger!
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@148 Opinion wrote:-
However, I do not think that is a good idea if any country is gonna leave the Euro to sort its financial problems. That just looks bad and sends a bad message: we are with you when you are doing well, we do not want you when you are doing bad. Sounds odd to me.
Opinion,
You may be right but I wasn't suggesting that a country in difficulties (like Greece at present) ought to be asked to leave but rather that it should not inflict agony upon itself by staying in if, by leaving (perhaps only for a time), it could spare itself that - eg by devaluing its (own) currency.
Britain was not in fact given that choice but was forced (because of the refusal of the Bundesbank to support the exchange-rate that Britain - unilaterally - had chosen for itself) to do that. By common consent, if I have understood right, that was the best thing that could have happened for Britain even though at the time there was weeping and wailing and gnashing of teeth and cries of "dirty foreigners" and "evil speculators" in the British media.
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@147. EUprisoner209456731 wrote:
EUpris: We are not across the Channel. You are!
I don't believe this! It regurgitates that hoary old "Punch" spoof-headline, mocking jingoists (vintage 1890's?):- "Fog in Channel...Continent cut off". Never in all my born days did I think I'd see it repeated (more than half in earnest).
By the way, I'm a Brit. Why did you assume otherwise I wonder?
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157. At 12:48pm on 13 Jun 2010, DurstigerMann
I did not say that your argument does not make any sense.
I think that the debt problem is just an effect of bad financial and economic system and not the cause of the actual financial and economical problems.
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Drugstore man;
"However, I would never open a factory in the PRC if I was looking for product quality. Taiwan is an alternative, but imo there is no reason not to produce in Germany or the USA other than higher revenue."
I'll bet there are a lot of company executives in Europe and America who felt the way you do. They are unemployed now and their companies are either out of business being the victims of lower cost competitive products or were taken over by people who moved to China anyway seeing no alternative. I'll bet there are German car plants in China. Isn't Volkswagon one of them? What will you say about it when Mercedes, BMW, and Porsche open plants there?
Quality of products made in China is very variable. Some are very poor, some are excellent. China has managed to launch a man into space and bring him back safely. Germany has not. Many of the products you use every day were made in China. So I'll bet you are not in business. If you were, Christmas at your house would be a very bleak time.
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Huaimek
Apologies for late reply - pleading World Cup as an excuse! Can't believe England's poor luck against USA.
In a previous post you highlighted issues the Italian economy had because of borrowing, which I also highlighted as an Irish problem too. You stated" Somehow the Euro currency gave a scope to let everything get out of hand."
I disagree - I think it's simply a case of old habits dying hard and those in power who conveniently choose to ignore the past being doomed to repeat it. Reckless borrowing would probably still happen if Italy had the lira and Ireland the punt. Your point about concealing it in the old currencies is moot - they cannot hide such borrowings in the Euro.
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#160 EUpris
Since when has Britain helped anybody but themselves in Europe financially without a fight ?
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Mick;
"Apologies for late reply - pleading World Cup as an excuse! Can't believe England's poor luck against USA."
For those that believe in luck, if British America bashing doesn't end soon, Britain's run of bad luck will have just begun. My feeling of the worst the US could do would be to pull out of NATO and leave the Europeans to defend themselves. The money saved by America could be used to finish cleaning up the mess from the Gulf oil spill after BP's last dime has been spent on it and BP is no longer around.
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Where is DAVID ???
His Last contribution was 6th June.
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I still don't understand the grouping of these countries together. The problems facing each country of the poorly named PIIGS are quite different, and a measure of budget deficit, external debt and public debt shows this. The main factor linking the countries is the poor economic state, but how they have ended up in such crises are different.
Two recent independent reports in Ireland have concluded that the crisis here was home grown by bad banking practices. To somehow blame the Euro for how the banks and regulators acted seems slightly misleading.
There is, in my opinion, a need for closer control at an EU level, and most in Ireland support the plans for EU budget scrutiny (poll in yesteday's Irish Times). The problems facing the Euro Zone are a threat to economies outside it too and therefore there is a responsibilty at EU level to prevent future troubles arising.
Gavin seems to blame the common factor or EU17 membership on the faltering economies of the countries mentioned. Devaluation is a short term solution.
I wonder if the UK budget will be labeled an 'austerity package', or is this nomenclature reserved for the economies using the euro. Will Britain have to reduce spending? Are Cameron and Osborne planning on a smaller and more efficient government?
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@163 cool_brush_wood
Thanks for the comment. Being a pro-European does not necessarily mean that one should not be critical or cautious when the Brussels’ institutions seem to be unable to control the situation. True, our economy rocketed for the last five years thanks to the financial discipline imposed by the IMF, the low taxes which attracted the foreign investors, and the increased income from the free export to the member states. The good results (the country economy registered before the recession) did convince many politicians here that the EU is something similar to a bottomless bucket of benefices, and that the EU market is granted forever. The latest events however proved how wrong we were in our careless stance of “Let it go that way”. The government now is not so eager to join the euro zone fearing that the unstable currency could diminish the fiscal reserve.
Of course, I do hope that the proper ways of improving the monitoring of the investment process within the EU are yet to be adopted, and that the current fiscal crisis will compel us to precede to some change in the Lisbon protocols concerning the single currency. You may object that any further centralization of power in Brussels will diminish the efficiency of EU economy, and that the whole project may gradually loose speed before it fell apart completely. I do not share your pessimism. The real challenge is to find the optimal decision.
Regards
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danremont at #172
I think the global recession and how that has impacted upon the different economies around the world stems entirely from the lack of regulation and oversight of banking lending practices going back many years. As soon as Lehman Bothers was allowed to collapse, the other Banks realised their 'happy days' were up and banks have had to be bailed out as they stopped lending to one another to fund the humungous debts that they had created by lending without discretion and true diligence.
However, the Banks, although at fault for lending unwisely are only half of the equation. For every Loan there is a Borrower. People, organisations and governments have been borrowing far more than their ability to repay - in some case for years and years - and they are all equally at fault.
Now the credit bubble has burst and money is simply not there to be lent, the governments that have borrowed beyond their means (i.e. those nations that have Debt greater than their Tax Revenue and other incomes) have had to make and take austerity measures to reduce their spending to bring their economies back into the black (or at least, if continueing to borrow, borrowing within their means).
Portugal, Ireland, Italy, Greece and Spain were particular basket cases for having weak growth and poor expectations for being able to meet their debt repayments unless they took deep, meaningful and hurtful cuts in public expenditure. However, all of the EU nations except Luxembourg are all in excessive debt and all of them need to take some measure of medicine to bring the EU nations back into becoming viable economies.
The UK is included in the EU nations and the UK will be introducing austerity measures to reduce its Budget Deficit and National Debt in the Autumn 2010. We should start to know hao bad thigns really are and some of the measures the UK Government is going to be taking starting in the next few days.
I don't blame the Euro for causing the problems of the PIIGS nations having weak economies - they were probably weak or going to be weak economies regardless of membership of the EU and their use of the Euro regardless.
What the global recession has revealed is that the Eurozone was not prepared for (nor capable of immediately dealing with) the Global Recession due to the banking crisis and because the European Central Bank was not equipped to deflate, increase money supply or lend out money to any of the PIIGS, the other Eurozone nations have had to bluster their way to a compromise. The best that EU Leaders and Eurozone nations could do for Greece was to have the IMF step in and have the Eurozone nations club together to create the Central Lending Fund (only-to-be-used-if-absolutely-necessary) and from which Greece has already had to borrow.
Borrowing to pay of debt or increase money supply is a sure-fired way to create further economic problems.
The UK was able to let the UK $£GBP devalue and has increased money supply to combat the severity of the impact of the Global Recession but, as you say, devaluation is a short term measure and the UK will have to spend less on its Public Sector and invest more into the Private Sector to induce economic growth which is the only long term and viable solution.
Insofar as the Banking Crisis created the global recession it did not create the fundamental flaws in the Euro but the global crisis has signed the death knell for the Euro unless the Eurozone nations agree to centralised fiscal control and economic openness such as preview of national budgets.
The problem with that is that such measures will involve the EU in fiscal matters and fiscal matters are sovereign matters under the current Treaties - thus any such moves will, if they involve ALL of the EU nations, require a revision of the Lisbon Treaty and that will generate more referenda and could possibly lead to the end of the EU.
The UK has, and I wholeheartedly agree with the coalition stance, that, any further transfer of sovereign powers to the EU will not happen in this current UK Parliament and the Conservative Party will likely seek a referendum if there was a move to scrutinise UK Budgets before they were seen by the UK Westminster Parliament. Such a referendum call would (and must ultimately) lead to a referendum on whether the UK should remain in or leave the EU.
If the UK leaves the EU then I estimate that 1/6th of the EU Budget Revenue is lost and I suspect that other current EU nations will notice that impact and reconsider whether they should be in or out of the EU as a political organisation with less money is of necessity incapacitated.
I suspect that eventually the Euro will collapse as it was always more of a political statement of unity and never designed to withstand speculation as to whether it could handle different economies with different problems in terms of infrastructure, revenue, growth and capacity but even more problematic is the absolute ineptitude of the EU to do any more than pontificate that centralisation is the solution to all of Europe’s economic woes.
I suspect that the days of the EU are now also numbered unless the people get a say in how it is revived and I suspect that the majority of people in Europe would vote: Free Market – Yes; political centralisation and federalism - No!
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@170 MA
"My feeling of the worst the US could do would be to pull out of NATO and leave the Europeans to defend themselves."
How lucky we are that Mr.Obama and your general staff do not share your genial conception!
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To MarcusAureliusII (167):
You do know that both BMW and Volkswagen have plants in the USA too? Having German companies manufacturing in other countries than Germany doesn't decrease work in Germany, it increases it. By manufacturing cars in both USA and China, BMW and Volkswagen lower their costs by having 1) lowered transportation costs; 2) lowered currency risks; and 3) scale of economies, i.e. unit cost of research and development become lower.
In any case people don't buy German cars because they are manufactured in Germany. They mainly buy them because they have German engineering inside them. You do remember the Volkswagen ad campaign?
Un-pimp Your Ride I
http://www.youtube.com/watch?v=qgEvy60bZYI
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#170 Marcus
Your naivety always amazes me !
Whether in Capitalism or Feudalism, the peasants ALWAYS pay, so get your wallet out.
Americans or the Subjects will pay the bill --- one way or the other !
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@ 162 DurstingerMann
“That`s right, 92 years after the great war, my nation is still paying for the unjust trearty of versailles which paved the way for WWII….”
Easy Lieber Krieg Kamerad /dear comrade in arms/. We lost together the two great wars, and after your genius intervention I believe we still have the chance to lose another one before our hotheads come to the simple truth that Europe is the only piece of a territory where our folks can live, work, make love and die in peace…
“The Marshall Plan was an attempt to bring Western Europe under US-influence and to incorporate them into the Bretton-Woods system.”
I totally agree. Robert Schumann is believed to be the founding father of the EU, but without people like Conrad Adenauer he certainly could not succeed.
Sofia, June 14th
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@141 MAII
"Increasing the money supply deflates the value of each unit of currency causing prices, interest rates etc. to rise in respones. Demands for salary increases too. The value of the currency itself is deflated along with all debts owed at a fixed interest rate."
Ok, a deflating unit of a currency of course loses value.
The price-index goes up in this case.
So far I can agree. Maybe I didn´t read carefully enough, doesn`t matter.
However, increasing the money supply casues interest rates to FALL.
There would have been no housing bubble otherwise.
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@160 EUprisoner
"1968 Bulgaria and Yugoslavia."
What a pity that I did not arrest you in Plovdiv for spying our troops that were preparing the invasion of Tchekoslovakia.
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@166 opinion
"I think that the debt problem is just an effect of bad financial and economic system and not the cause of the actual financial and economical problems."
I absolutely agree.
If you are against systems like FIAT, I am the first to join you.
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M;
"I think the global recession and how that has impacted upon the different economies around the world stems entirely from the lack of regulation and oversight of banking lending practices going back many years."
What a profound thought. Had banks insisted on a full, thorough independent audit of the finances of the PIIGS, they'd have cut them off at the knees for credit a long time ago. German banks would not have loaned them the money to buy German exports. But then Germany might not be able to claim being the world's number one exporter nor its GDP as high. And if banks had done their due dilligence German and British exporters might not have gotten contracts that were secured through bribes, the banks not only refusing to handle them but revealing them to regulators and the world. How many billions were paid to Saudi Sheikhs and princes by UK defense companies 2 billion dollars to secure 44 billion in cotracts? These might have gone to American suppliers for example.
"Insofar as the Banking Crisis created the global recession it did not create the fundamental flaws in the Euro but the global crisis has signed the death knell for the Euro"
Ever spray a flying insect with insectiside and it keeps flying around for a while. It doesn't know it's dead yet. That's where the EU is.
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129 - quietoaktree
"Without German re-unification the map of Eastern Europe would have been much different. The Cold War was ending and a re-united (wealthy) Germany allowed the East to choose Nato and another ideal (instead of Communism). The Brits ( Thatcher) almost scuttled their Freedom and their entry into the European sphere of influence by using the same anti-German tone as you yourself".
I have grown accustomed to disagreeing with you and am even beginning to live with your post as vehicles for shameless anglophobia but, this time, you excel yourself. The above quote is utter, unadulterated claptrap. It is historical as unsustainable as it is philosophically.
German reunification occurred after the Solidarity process in Poland, the Velvet Revolution in Czechoslovakia and the opening of the Iron Curtain on the Austria-Hungary border. It was the exodus of East Germans through Czechoslovakia to Lake Balaton - ostensibly for the usual holiday period - that precipitated the process further south allowing them to go west and the whole process was made possible because of the undertaking by Gorbachev that it was no longer the business of the Soviet Union to interfere in the internal affairs of its European satellites. You remember Gorbachev, do you? This was the man of whom Thatcher famously said 'this is a man with whom I can do business'.
Thatcher left office in November, 1990, barely a month after the declaration of October 2, 1990 reunifying Germany. John Major's administration actively supported the accession of the former Warsaw Pact countries to both NATO, which was quickly achieved and the EU, which was a longer process but believed to have been a bargaining chip in getting Britain to sign up to Maastricht. The UK's record in championing enlargement eastwards is impeccable and was frequently conducted in the face of opposition from continental Europe.
No sensible person would deny the commitment of both the former West Germany nor the unified whole in its determination to follow the same route. On this issue, the Germans and the British sang from the same hymn sheet throughout. All credit to them.
But your utterly absurd assertion that Thatcher - even if she had been in a position to do so - sought to 'scuttle' the process is an unforgivably revisionist view of recent history which does not stnd up to examination and lays bare your real agenda.
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170 - MarcusAureliusII
". . . if British America bashing doesn't end soon, Britain's run of bad luck will have just begun . . . "
Pot calling the kettle black Marcus. Your only real pleasure in life seems to be Brit bashing and EU bashing then you come up with a load of rubbish like this. Only you could manage to throw an ecological nightmare in the Gulf, the US involvement NATO and a football match (for goodness sake) into a single short post and them blame 'British America bashing'. You hypocrisy is absolutely breathtaking.
Normally I am happy to spar with you but, on this occasion, the utter contempt in which I hold your post cannot be expressed without using language that the mods could not possible allow.
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Just figured I'd reword part of your last paragraph for you, Gavin, as follows:
"So the price of staying outside the euro-zone is that the UK will have to cut wages and embrace wide-ranging reforms to boost productivity . Government will have to be smaller, more efficient. There is likely to be social tension. The challenge facing the UK is this. If it is to grow and compete we will have to cut wages and reduce spending. Growth will be at best anaemic. Unemployment will remain high. We may escape the bullet, but the potential legacy of having refused to join the euro is hard times for a generation".
In other words, the UK escaped little, if anything, from having stuck with Sterling. We have had all the "downsides" of not having adopted the Euro and, it is clear, that the Euro-sceptics' "upsides" for not having done so are just pie in the sky.
As one cartoon I saw put it, the (UK's) economy is in such a mess, we must be eligible to join the Euro-zone.
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#174 Menedemus
If a British exit would be the downfall of the EU, how did it ever survive before Britain entered ?
Who was prepared for the Global recession ?
Your whole long contribution, however eloquent, is of 19th century mentality.
The times have changed but both yourself and CBW are hanging on to an Empire that has long gone, and what remains looks rather pathetic and vulnerable to Global realities. The oil wealth has been squandered, the main ´industry´ has just bankrupted you and the average Brit needs three low paying jobs just to make ends meet. Do you really believe that the EU has destroyed Britain´s glorious future ?
The ´Powers´you will fight to the death to defend do not belong to the Brit on the street, but to those who do not want to loose them !
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#183 Threnodio
I stand by ALL my #129 remarks.
Especially condemning Thatcher (Britain ?) for her opposition to German Re-unification.
Many of the UK bloggers still wish she had got her way !
Do you need proof ????
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#183 Threnodio
http://www.timesonline.co.uk/tol/news/politics/article6829735.ece
I hope this link functions.
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#187 - quietoaktree
I did not say that Thatcher did not oppose German reunification. I thought then and still think that she was wrong.
I suppose the idea that she wanted the other Warsaw Pact countries to fall within the UK sphere of influence before a united Germany had a chance to flex its muscles is too far fetched for you? The British government was looking for Atlanticist partners in a wider Europe and to some extent, it was a successful ploy. It has decisively changed the balance of power in the EU shifting the centre of gravity away from the Franco-German axis which was dominant. That axis now appears to be under pressure as the Euro crisis threatens to engulf the hard core.
With the exception of Slovakia, all those nations continue to be outside the Euro zone. Watch this space. She may not have been as daft as you like to make out.
As to rest of your assertions - do I need proof? You are damned right I do.
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Drugstore man;
You'd better get out that economics 101 book and study it or at least get one from the library. As more currency is printed, especially in relation to actual growth of wealth it can buy, people who lend money want higher interest rates in the expectation that the value of what they will get back will buy less. They don't know where price inflation will end. That is why it is best to do it in one shot and tell the markets, hey this was it. We're not raising it again. Do it overnight when they are asleep :-) Actually I'd suggest that the US government send every American taxpayer a check for 40,000 all at once and pass protective tarrifs to keep the money in the country. That's their best bet at simultaneous recovery and not raising interest rates too high. Once the markets adjust to the new paradigm, interests rates might settle down. Old debt paid back with new cheap money will just be written off. Either that or under the current strategy most creditors will wonder if they will be paid back at all.
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#183 Threnodio
I was in Germany at the time and leaks had appeared in the German press that Britain was causing problems .
Gorbachev´s position was clear during the GDR anniversary celebrations --- ´Life will punish those who come late´!
Hispanico´s complaints that that Germany spent over the 3% allowed under EU rules forgets that West Germany ´bought´a country with 18 million inhabitants. Millions of unemployed, millions of pensions to be paid and businesses and infrastructure run to the ground etc etc.
Against this background the British contributors who show snobbishness and arrogance with their arguments hardly deserve intellectual respect and may themselves experience Gorbachev´s prediction.
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This comment was removed because the moderators found it broke the House Rules.
Quietoaktree @#186
The UK entered into a Common Market that was essentially a free trade area and the Common Market preceded UK joining and would have continued perfectly capably if the UK had not joined.
That said, it was in the genuine interest of the UK to join the free trade area as reduced export costs are always welcomed. However, if the UK had not joined then the UK would have been adjoined to the Common Market like Norway and Iceland with preferential trade agreements as the Common Market exported to the UK just as the UK exports to Europe then and now.
It was the UK adoption of the Maastricht Treaty that conjoined the UK into becoming part of the European Community that, in turn, became the EU and put an obligation upon the UK to contribute to the costs of creating and running the political construct that was the EU ... the UK was already at the party but the UK politicians chose to sign us up to to EU membership without the consent of the people to stay at the party.
We should have left the EU before it got off the ground to be quite frank!
If the UK leaves the EU then the EU simply no longer gets the UK VAT and cutoms and excise tariffs which we recieve for all our trade with the rest of the World including much trade with the USA and the Commonwealth of Nation of which the UK remains a member.
As the UK is the second largest contributor to the EU (and would be largest if we didn't get the EU Rebate!) then I think it is safe to say that it would hurt the EU more and the UK less to leave the EU as the EU would lose the UK contribution to the EU Budget.
It is even arguable that the costs of exporting goods to the EU Free Trade Area as an outsider nation might even be offset by the fact that the UK was not having to pay the UE Budget costs through VAT receipts and Customs and Excise Tariff receipts as the UK would continue to import and export outside of the EU area and those receipts would be income for the UK alone.
My viewpoint may appear to you to be 19th Century but I assure you it is far more pragmatic than that. I simply see the EU as a political construct that has been created by politicians and technocrats and which does not have popular voted mandate. So long as that is the case I see the case for the UK leaving the EU and simply working with other European Nations whilst maintaining our existing friendly relationships with Europe, America and the Commonwealth of Nations.
Being outside of the EU works fine for Norway. It has worked fine for Iceland (even though they need the EU to bail them out so have to join first and get their EU budget slice a.s.a.p.) If it worked ok for Norway and Iceland, it can be fine for the UK. Just give the UK citizens the chance to vote us out I say - that or can the EU please kick the UK out ... please!
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180. At 11:04pm on 13 Jun 2010, generalissimofranco wrote:
"@160 EUprisoner
"1968 Bulgaria and Yugoslavia."
What a pity that I did not arrest you in Plovdiv for spying our troops that were preparing the invasion of Tchekoslovakia."
EUpris: I had told my mum I might be going to Czechoslovakia!
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#193 Manedemus
I will attempt to reply later.
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180. At 11:04pm on 13 Jun 2010, generalissimofranco wrote:
"@160 EUprisoner
"1968 Bulgaria and Yugoslavia."
What a pity that I did not arrest you in Plovdiv for spying our troops that were preparing the invasion of Tchekoslovakia."
On the Black Sea loads of Brits were in bars chanting "Dubček! Dubček! Dubček!" but they did not get arrested. Now you want to arrest me because of my criticism of the "EU". So you appear to be saying that the EUSSR is worse than the USSR!
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Re: 180. At 11:04pm on 13 Jun 2010, generalissimofranco
I want to be friendly with the Bulgarians. I just don't want to be in a political union with the continentals or the Americans.
I want to be friendly with the Americans.
I want to be friendly with the Japanese.
Before Bulgaria joined the "EU", British police officers were in Bulgaria helping the Bulgarian police stop drugs passing through from Turkey.* Sensible cooperation is possible without the "EU".
* his is not a criticism of Turkey. My experience in 1968 was that the Turks were making a tremendous effort to stamp out drugs.
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169. At 5:34pm on 13 Jun 2010, quietoaktree wrote:
"#160 EUpris
Since when has Britain helped anybody but themselves in Europe financially without a fight ?"
EUpris: Probably every single day since we joined this stinking mess. The fight has not been about an attempt not to pay at all but a fight about not paying too much.
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82. At 12:27pm on 12 Jun 2010, RantingMrP wrote:
"The answer seems rather obvious: allow Germany to run a federal, united Europe, both politically and economically. The problem goes away. Oh - you might have to kick the UK out to achieve this, but Europe won't miss the Brits much, will they?"
EUpris: If you can get them to kick us out of the "EU" I will drink to your good health in bubbly!
Won't miss us? Will miss the billions we pay for this rubbish!
Get the Germans to run it!!!???!!
1) How well will that go down in Poland and elsewhere?
2) Very similar to ideas in the German establishment in WWI, when it was going well for the Germans.
3) Reminds me of what a German member of a German Catholic order of brothers said to me in the seventies: "In the short term or the long term, there is no alternative. We Germans will have to take over here in Europe."
The same man described to me how he dealt with people who caused him problems: "I jump with my naked arse in their face."
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#182 Lover of anything Greek:
"How many billions were paid to Saudi Sheikhs and princes by UK defense companies 2 billion dollars to secure 44 billion in cotracts? These might have gone to American suppliers for example."
But deary me, the yanks offered only 1.9 billion in bribes - how could they possibly expect to get the contracts on so measly terms?
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#193 Menedemus
The UK entered into a Common Market that was essentially a free trade area ...
The EEC never was 'essentially a free trade area'. See my previous post here for leaflets from the 1975 campaign. The NO camp pretty well understood the issue then.
Norway and Iceland are small countries, and happy to be so. The UK once ran an empire on which the sun never set, then a Commonwealth on which the sun never rises (Muggeridge), and finally wanted a say in the EEC/EU in order to not be ruled by the strongest European power (united Germany). Please do not underestimate the thirst for power UK politicians have.
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ThrenodioII & Menedemus
Re #129 & the rest of the dross
The chap wrote his motive some time ago, he wants to "..pay back.." all the English for our perceived anti-German/anti-EU contributions!
As if these Blogs are anything but a forum for exchange of ideas: In a febrile mind he imagines he's righting some wrong!
Don't bother Yourselves: It's either quarter-truths & innuendo or total fabrication!
The complete lack of substance means there's nothing You can properly refute and replies merely encourage more outlandish Anglo-phobia: Any response other than pity simply plays to an inadequate ego whose grasp on historical-reality is at best a disney cartoon version!
I can't even be bothered to humour him anymore; it's pointless.
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@196 @197 EUprisoner
Of course, I was joking when I was mentioning of arrests of innocents in 1968. As a matter of fact, there were arrests in the USSR and elsewhere in the former Warsaw pact countries, mainly among intellectuals who dared to express some kind of protest against that evident break of the International law; I mean the invasion of Tchekoslovakia.
I thank you for your kind and franc comments about us, the Bulgarians, and I should avow that the Brits were always welcome here, just like the (North)Irish, the Germans, the French and all those folks who would come here from Eastern Europe to pass several weeks of leisure on the Black Sea beaches. As a matter of fact, several thousands of retired Brits did move to Bulgaria, bought, repaired old houses in the capital or in the countryside and remained here. Some left of course, ‘cause they seem to be disappointed of the general mess here /corrupt local administration, poor infrastructure, poor quality of the services, etc./. However, the mere presence of many Brits here is just another prove that the integration process is gaining speed and seems to be irreversible.
Of course, being a pro-European, I am not blind, deaf and dumb man when seeing the inability of the Brussels institutions to solve quickly the pressing problems of my country. And, if we speak of corruption of the local businessmen/bankers/government, etc., we should not forget that no corruptive action is possible without the collaboration of some highly ranked Brussels official. However, for us, poor East European nations, there is no other plausible alternative for a smooth and peaceful coexistence than the full membership and commitment to the EU and NATO structures, no matter the inevitable loss of some portion of the national sovereignty.
I thank you once again for your franc and honest stance about the EU and everything that is somehow linked to it, no matter that I do not share it, and, I shall be glad to continue our chat here with you.
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This is degenerating into another one of those debates about whether or not Europe is a good thing and who made Europe in the first place. Very far removed from "The Case Against the Euro". Let's get a few things out of the way before we get back to the Euro.
1.) You do not need to be anti-American to be in favour of Europe. Some here deny the Marshall Plan did anything in the way of helping Europeans while others say it was ONLY the Marshall Plan plus the Europeans never did anything for the Americans. Both positions are extreme and absurd. The truth is that the Marshall Plan helped Europe greatly, but Afghanistan and Iraq prove my earlier point that you can pour and pour money into places without ever seeing any improvement. Europe would not have improved if it hadn't worked hard for it, Marshall Plan or not. Americans have done a lot to keep the world safe, but it's absurd and obscene to say Europeans have not done anything to help. British people fought and died for Western interests in the war to get Saddam out of Kuwait and Germany paid huge amounts of money to help the alliance. Many Europeans have died in Afghanistan, a war that was fought and is still being fought in retaliation to the 9/11 terrorist attacks.
2.) Debates like these invariably degenerate into a "who has been keeping us safe" debates - was it NATO or the EU? The truth is, it was both. European fanatics tend to exaggerate the EU's role in keeping the post-war order while belittling NATO while the other extreme of the political spectrum tries to delude itself into thinking that NATO could have done it alone without Europe. The truth is that both NATO and EU have been contributing factors in post-war peace. That is not to belittle other important political movements, like Solidarnosc in Poland or Turkey's role. NATO and EU both have a tendency of being somewhat autistic in their belief that they are the only ones that matter in the post-war order.
Now to the Euro - I sincerely believe that introducing it was a mistake. But again, it is not the only currency in the world and the introduction of many other currencies were a mistake to. Just think of what horrible cataclysmic events were made possible due to the introduction of the American Dollar or the Russian Rouble. Mexican-American war? Unthinkable. Slave trade? Unthinkable. Genocide against Ukrainians, Poles, Finns, Baltic Nations and several Central Asian and Siberian nations? Unthinkable.
But the existence of the Dollar, the Rouble and the Euro is a fact of life. Those who oppose those currencies rarely come forward with any way of how this could be done. They just complain about the fact that there is a Euro but that's like complaining about the weather. What are we going to do about it?
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Chris Camp
Re #205
Agree with quite a lot of that (re Marshall Plan-NATO) & I think most of regulars would.
That said, I'm not sure the main debate has been about dislike of the EUro/zone per se, but given the parlous state of the EUro-currency, more of why anyone/nation except those struggling EUro-zone members should now be expected:
1) To contribute to any 'bail-out/rescue' package of a zone member?
and,
2) To accept Brussels' tighter control and oversight of individual National Budgets is required or acceptable for nations outside that EUro-zone?
Yes, the UK & other non-EUro nations are in deep financial crisis, but it is not of the EUro-zone's making and quite why a 'zone' in all sorts of trouble due to its own erroneous Fiscal policy should now influence UK etc. Fiscal-policy eludes me!
Mid-way 2010: I really think Germany must give consideration to whether it wants to remain in the 'zone' or return to its own currency: Its Government is currently using German Tax-Payers' money to pay the lion's share of securing the EUro's future by saving other National Economies from bankruptcy. That is a noble and truly supra-national bout of generosity.
However, Germany cannot keep on doing so, and any idea that by tighter centralised EU regulation there will be no more cyclical Recessions or the likelihood of dubious fiscal practises somewhere in EUrope is a nonsense.
Germany's tax-wallet will be picked again by those less fortunate or less scrupulous!
Also, Germany cannot keep on paying for a 'war guilt' complex utilised by France at every opportunity in previous decades & that nobody under 65 in Germany surely has any responsibility for in the 21st century!
Why would Germany tie its Economic-Fiscal future to a collection of Nations that simply cannot keep pace with it? Surely recent events concerning the EUro-zone have entirely exposed the fallacy of 'one-size-fits-all': Germany does not fit with any other EU economy and whilst for 30 to 40 post-WW2 years it made some political-economic-social sense to pull EUrope together those conditions no longer prevail.
In an increasingly 'globalised' World I would suggest there is every reason for Germany to pull back from the centralising, blanket of Brussels' legislation & regulation. Germany could & should make its own mark whilst retaining updated versions of those looser Trade-Travel-Tariff arrangements that made the former EEC such a success.
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There is no problem with the Euro.
There is a big problem with limited and poor political and economic policies.
There is a big problem with everyone thinking he is smarter, better and quicker than all the others.
There is a big problem with everyone thinking that their way of doing things is the best and everyone must follow it.
There is a big problem not recognizing that you are outdated and incompetent.
There is big problem by living in the present with the backup of past glories and thinking that past success gives you the right to lead the way forever.
The problem is that past success (glory) really means past success and once you talk about past glories and successes really means that you are on the downward curve.
The problem is that once you reach the top there is only one way, and that way is down.
The problem is that we should look around, in the present to see who is on the upward path and believe if there model is different than ours that means that is gonna be the next successful model.
Euro is a step forward for European nations and it is not Euro the cause of the current debt problems. The cause is incompetency masked behind populist measures.
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smroet @#202
That is half the problem - the thirst of the British Politicians to be at the center of Europe is unlimited and they are more than happy to engage in and be part of the Council of Ministers, become Commissioners and wal-the-walk of the EU politicians.
On the other hand, Great Britain now renamed the United Kingdom which it is clearly not is no longer the world power it once was and, although the UK rightfully has a place in the G8 because it has high-end GNP it is does not really have the right to be a permanent seat holder on the UN Security Council nor does it really have the right to try to still vie with Germany and France for being one of the three major players in Western Europe. The UK should realise its place is not at the heart of Europe but simply a small island with too large a population sitting on the edge of cotinental Europe and accept that it is a small country like Norway and Iceland.
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smroet
Re #202
As the 4 Allied Powers signed the Treaty handing back full sovereign authority to a re-united Germany on 12.09.1990 (following official West & East Re-unification Pact 31.08.1990), the Single EUropean Market came into force 01.01.1993 and the EUropean Union established as the Maastricht Treaty (ratified by EC Foreign Ministers 20.09.1992) on 01.11.1993 (which had passed the UK House of Commons with only a Majority of 3 & had scraped through a France Referendum by 1% majority!), I think Your timeline of UK 'Political' ambitions re, continental Europe are a bit off-calendar & off-realism in terms of which National Governments were overly keen on keeping a prominent role in EUrope.
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205. At 06:59am on 14 Jun 2010, Chris Camp wrote:
"""The truth is that the Marshall Plan helped Europe greatly, but Afghanistan and Iraq prove my earlier point that you can pour and pour money into places without ever seeing any improvement. Europe would not have improved if it hadn't worked hard for it, Marshall Plan or not. Americans have done a lot to keep the world safe, but it's absurd and obscene to say Europeans have not done anything to help."""
Chris, on the one hand you defend muslims, on the other you downgrade Arabs and Afganis as not doing too much. I really do not accept such position.
The Marshall plan itself (talking strictly about this specific plan), was nothing more than getting rid of excess US production while at the same time binding politically non-communist occupied Europe. The proof is that the country that did best was Germany which was statistically the smallest recipient of MArshall Aid (it took even less than... Italy with less population and much less spared in catastrophies!). It was other things on the side that aided Europe (mainly the installation of a US supported international financial system) and I think when people refer to Marshall plan they actually imply all other things on the side.
One has to understand the basics of economics. Western Europe quickly got redeveloped for a number of reasons (including first of all that it was pretty much the main motor of global development prior to the war and in other places one could name only a US, Canada, Australia, Argentina & Japan following... all other countries were still quite at a distance) - but the most important thingie was that surprisingly (for me unsurprisingly) the war had done too much damage to infrstructure and housing but little damage to industries (... only 5% of the German industry had been bombed during all those terrible bombings, showing the real Allied policy behind...). Hence all countries after the war they had found themselves with a surplus of industrial capacity and a huge market in demand of everything. It takes no analyst to tell you what follows: a period of rapid financial development.
Iraq and Afganistan were non industrialised countries. They had the bad chance to gain independence only on paper, while their governments were always intercepted by foreign interests. The main interest of the British Empire was to keep them down so as to cut commercial routes. The main case of Iraq would be to use the British controlled Persian gulf. Similarly the main interest of US is quite the same. Isolate Iraq, isolate Afganistan, cut the central Asian - Middle Easter - East Asian trade routes. With Afganistan and Pakistan in turmoil, Iran cannot sell any substantial quantity to China. With Iraq in turmoil, the road to the west is also closed. So really the last thing that ever interested the British and now the Americans is to let local people work for their development. Don't judge locals on what you see right now. It is NOT their fault. They are trapped in a vicious circle and they have no choice. Absolutely NO choice.
"""British people fought and died for Western interests in the war to get Saddam out of Kuwait and Germany paid huge amounts of money to help the alliance. Many Europeans have died in Afghanistan, a war that was fought and is still being fought in retaliation to the 9/11 terrorist attacks."""
Sounds nice. Dying combatting societies forced to live in the middle-ages , all that for commercial interests. How proud really can these troops be if they realise they fight for commercial traderoutes?
"""2.) Debates like these invariably degenerate into a "who has been keeping us safe" debates - was it NATO or the EU? The truth is, it was both."""
Safety by war. Nice. Peace is war. War is peace.... when it is done elsewhere of course.
""""That is not to belittle other important political movements, like Solidarnosc in Poland or Turkey's role.""""
Yeah Turkey's role... only 3 huge genocides, 1 huge pongrom, 2 failed invasions and 1 successful invasion followed by complete ethnic cleansing, all that while sweeping its own citizens born in the wrong culture and while constantly threatening its neighbours with war. Quite some safety there...
"""...Genocide against Ukrainians, Poles, Finns, Baltic Nations and several Central Asian and Siberian nations? Unthinkable."""
You forgot that the main nation that was genocided were the Russians. Out of the nearly 50 million people massacred by the Reds, the vast majority were Russians. The rest just got their share. Siberian nations are there counting in millions, all with at least basic education and health and with the possibility of substantial social ascension. US natives are counting a few thousands and their only social ascension up to date is casino building. Russians, though not much less violent than the English, they finally did a much better job.
Chris, I do not take any particular pleasure in revealing the poverty of your argumentation (have long lost the interest). But the world is far far more different than what you imagine it to be, you really have to wake up at some point.
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170. At 6:59pm on 13 Jun 2010, MarcusAureliusII wrote:
Mick;
""""Apologies for late reply - pleading World Cup as an excuse! Can't believe England's poor luck against USA.""""
""""For those that believe in luck, if British America bashing doesn't end soon, Britain's run of bad luck will have just begun. My feeling of the worst the US could do would be to pull out of NATO and leave the Europeans to defend themselves.""""
First, the US football team, while not having any 1st class footballers (for international standards, they lack experience in major international teams), they form a very interesting and quite unpredictable team which I always enjoy viewing (they have some nice skills, fluidity in their game and their sometimes relative naivety offers some interesting matches). The English team on the other hand has top players that rate highly in international football, yet there is this sort of psychological defeatism that drags them down. Despite I am considered here both as anti-British, anti-US (which I am only on geopolitics, not on other things), I do want them both to move on in the tournament, afterall Britain is the birthplace of the sport (respect), when they move on, the tournament is more interesting.
How about the Greek team? Already lost 2-0 to Koreans (not at all a bad team but not any top range either...). Actually Europeans, especially Angela, should be happy: We started already yiedling to the pressure to raise the retirement age so the Greek team is one of the most aged with flagship our (German!) trainer Otto who is 72 years old! Its all the grandpas that are on the field and the young ones sit unemployed on the bench. Nice one! All that while Angela sent the youngest German team ever... to beat 4-0 Australia (who like Greeks are also gandpas...) haha, quite a provocation there!!!
Second, yes, retire from NATO please. You'll do us a favour.
"""The money saved by America could be used to finish cleaning up the mess from the Gulf oil spill after BP's last dime has been spent on it and BP is no longer around."""
Retire from NATO and EU will send you BP, SHELL and TOTAL and money and men to aid you in this task...
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#191 - quietoaktree
I was in Germany for part of the time. The rumours - and that was all they were - have been subsequently been confirmed so let us spell them out. Thatcher wanted to resist German reunification on pragmatic ground. The majority of her cabinet did not agree and it was never British government policy. In fact, her whole approach to Europe was one of the major issues and when she did not get her way over Germany, she dug her heels min on EMS which prompted Howe's attack and brought her down in weeks.
"Against this background the British contributors who show snobbishness and arrogance with their arguments hardly deserve intellectual respect . . "
Ah, we take that to mean that you disagree, shall we? Most of here say so when we disagree. Mercifully only a handful launch into an abusive diatribe to conceal the paucity of reasoning behind their posts. I hope I am not arrogant but snobbery can rear its ugly head when confronted with prejudice. I am sure you understand that it has nothing to do with being British and, trust me, I can live without your 'intellectual respect'.
#203 - cool_brush_work
You are right, of course. Its just the abusive content which raises my hackles - clearly what is intended. I will try to resist in future.
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Smroet @#202
Further to my #208
A common market is a first stage towards a single market, and may be limited initially to a customs union with relatively free movement of capital and of goods.
The concept of supranationalism for Europe did pre-exist the Maastricht Treaty and, of course, supranationalism is a pillar of the Single Market, the European Community and the, now, European Union. However, supranationalism does not necessarily require centralisation of political power, control and policy decision making.
Unfortunately, it seems to me that that centralisation and federalism has become the objective and end-game purpose of the EU Project and that is something that has to be decided by THE people of Europe and not the politicians (and technocrats who populate the EU)
It is noticeable that history now tells us that Charles de Gaulle himself was strongly against the concept of supranationalism and was a strong advocate of the British NOT joining the Common Market as he feared the influence of America through the British would be too great. I wish his veto had been maintained but alas Georges Pompidou was too quick to let the UK join the EEC.
It is also interesting to note that at the same time that the UK was allowed to vote for and stayed in the EEC, Norway also applied to join the EEC but popular vote has kept Norway out of the EEC and outside of the EU. Have the Norwegians suffered as a consequence - no they have not and the Norwegians probably laugh at the hoops the British people will have to go through to get out of the EU now when all they (the Norwegians) had to do was vote "Nei!" in the first place ... something the British should have done in 1975 and now we cannot reverse!
Democratic choice ... just the chance of a referendum vote on continued membership of the EU would be a fine thing?
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#168 Mickalus
I may be wrong , but the impression I have ; was that the security of the Euro currency after the first year or so , gave greater assurance to lenders , than might either the Lira or the Punt . Therefore countries like Italy or Ireland would have had more scope to recklessly borrow than with the Lira or the Punt .
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Anyway, sorry to bypass the main issue. What best way to return by repeating opinion's 207 message:
207. At 08:46am on 14 Jun 2010, opinion wrote:
"""There is no problem with the Euro."""
Indeed. Euro is just a currency, a means. Yes there are differences between the economies and all that but I really cannot imagine the fate of healthy being judged by the value of the currency solely. There have to be other structural problems for the economies to have problems. Greece for example did fare equally bad under the drachma, the euro only got problems worse but this because of the inherent problems of the internal market, at the end of the day it was not euro that caused it.
"""There is a big problem with limited and poor political and economic policies."""
Absolutely correct. Over-borrowing. Pretending to offer more than it should. Transforming the state in a combination of mother teresa prostituting to corporations.
"""There is a big problem with everyone thinking he is smarter, better and quicker than all the others.
There is a big problem with everyone thinking that their way of doing things is the best and everyone must follow it.
"""
Exactly. If they were, they should be doing it all by themselves. They chose to be in the EU cos they are NOT better, NOT smarter and NOT more able than others.
"""There is a big problem not recognizing that you are outdated and incompetent."""
Absolutely correct. Market obscolence. Europe (like US, like Japan too...) has to reinvent itself. It has to differentiate its market and let others try to cope with it, not try to regain a long lost momentum on the same good old base.
"""There is big problem by living in the present with the backup of past glories and thinking that past success gives you the right to lead the way forever."""
There is nothing wrong accepting the Chinese or the Indians on the same base as you, however not permitting them to play their game against you (which would be a historic payback...). That is where innovation enters: you are not obliged to rule over them, to keep them down, all you have to do is to to let them follow you, not you them.
"""The problem is that once you reach the top there is only one way, and that way is down."""
Still, Italian cities did not become poor when power moved to Spain, then to France, Holland and Britain. Europe did not become poor even after the WWII and the dominance of US. I do not see any unavoidable empoverishment of Europe with the rise of Chinese and Indians. But Europeans have to reinvent their markets. They cannot play the same game cos others have learnt well this game and they will be mathematically beaten.
"""The problem is that we should look around, in the present to see who is on the upward path and believe if there model is different than ours that means that is gonna be the next successful model."""
Hmmm... but you can have different parallel successful models.
"""Euro is a step forward for European nations and it is not Euro the cause of the current debt problems. The cause is incompetency masked behind populist measures."""
Indeed, absolute lack of imagination, lack of nerve, lack of peristence, sticking to past practices etc. We do have to change.
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#205 Chris Camp
Many countries have a currency called a Dollar , but those countries are not all tied together by the same unchangeable valuation of their Dollar .
The problem with the Euro is that its value remains the same for a prosperous country or a poor country . The EU gave the belief that all Eurozone countries would be equally prosperous , which was a nonsense , when some countries are highly industrialised and others not .
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#208 - Menedemus
It is not often I disagree strongly with you but in this case I must take issue. There are various measures of power but, even on the economic argument, the UK remains the eighth largest in the world. Fluctuation tend to turn the balance from time to time but over a period of years, the economy has been roughly the same size as France. To say that the UK is better compared with Norway or Iceland does not stand up to scrutiny.
As to her role in Europe, many EU sceptics who post here are very cynical about the dominance of Germany, France and Benelux in the formulation of policy. I would argue that the UK has a duty to fully engage in re-balancing this. The new members have facilitated this somewhat and particularly the emerging influence of Poland is becoming a factor. For Britain to make a conscious decision to take a back seat would not only be a lost opportunity to shape the future of Europe but it would be a betrayal of those in the EU who are looking for an alternative way forward from the Franco-German approach.
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#152 JorgeG1
" So where is the impartial analysis "?
In this post you effectively answer it yourself . You can see things wrong with the Euroe but you're not going to bring them up now .
The currency having the same unchangeable value for strong economies and weak economies , outweighs any pluses .
You have to have a single nation state with one economy , before you create the currency .
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I'm no economist (I'm sure no one would have realized that) but I seem to have a vague recollection that something called the ECU once existed - not as a currency in itself but as an arithmetical construct by which all EEC countries' currencies were expressed on a common basis. And wasn't its value arrived-at as the average of the whole basket? And weren't EEC members-countries' contributions expressed in ECUs?
I apologize for the undoubted inadequacy of that description, but the point I'm trying to make is:- might it not be a good idea to go back to some such arrangement? Member-countries in the system would then become enabled once again to manage their own currencies in the manner best-adapted to their own economic fundamentals. If competitive devaluation were feared likely (as was the case then: remember "the snake" and "the snake in the tunnel"?) the same or similar restraints could be resurrected too.
Might this not be preferable to trying to prolong the life of the euro if - as many have suggested - it is anyway doomed? And couldn't the ECU become a currency in its own right, issued perhaps by the ECB, alongside member-countries' own currencies and freely convertible?
This is not a new idea but it got overtaken by the political project to introduce the euro as a means to force the pace towards "ever-closer union". If that is now regarded as having been discredited why not be pragmatic and adopt something else (which did work, albeit in a more limited way) instead?
Or is that pie-in-the-sky?
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215. At 09:48am on 14 Jun 2010, Nik
Thanks for improving my comment.
Maybe we should try to get back to the topic from all these nationalistic centered discussions.
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Threnodio (217) said "many EU sceptics who post here are very cynical about the dominance of Germany, France and Benelux ... For Britain to make a conscious decision to take a back seat would not only be a lost opportunity to shape the future of Europe but it would be a betrayal of those in the EU who are looking for an alternative way forward from the Franco-German approach."
This is the disingenuous guff that you are so well known for on here. You argued in favour of the ratification of Lisbon, one of whose key changes was to the EU voting rules. Those Lisbon changes simultaneously increased the blocking threshold to 35% (making it harder for the UK to build a blocking coalition) and increased the weight of both the largest and smallest countries (relative to medium) such that the France/Germany/Belgium, Luxembourg, Netherlands group almost exactly meets the new blocking threshold and can therefore uniquely block what it does not like.
Before ratification you supported changes that would reinforce the dominance of the ‘Old Europe’ block, and afterwards you complain about it and say the UK has some duty to act as counterweight which has been made more difficult by the Lisbon changes you supported! The real 'betrayal' is from dishonest British EU supporters like yourself, who say first one thing and then its opposite, and whose only consistent message is that we should take whatever step would lead us deeper into the EU quagmire. The time for listening to disingenuous federalist fellow-travelers like yourself is over.
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@ 193. Menedemus
"Being outside of the EU works fine for Norway. It has worked fine for Iceland (even though they need the EU to bail them out so have to join first and get their EU budget slice a.s.a.p.) If it worked ok for Norway and Iceland, it can be fine for the UK. Just give the UK citizens the chance to vote us out I say - that or can the EU please kick the UK out ... please!"
When they talk about their role models Norway, Iceland and Switzerland, Europhobes always sideline two crucial issues:
1. By being members of EFTA (or its bilateral agreement equivalent as in the case of Switzerland), these countries 'have to adopt part of the Law of the European Union [but...] have little influence on decision-making processes in Brussels.'
http://en.wikipedia.org/wiki/European_Economic_Area
How democratic is that? If the UK is being ruled by a totalitarian superstate of which the UK *is a voting member*, how on earth can it be more democratic to be ruled by a totalitarian superstate of which you (i.e. Norway, Iceland and Switzerland) are not a voting member? And a large chunk of EU legislation is related to the single market, whether it is straight bananas or mobile phone roaming charges. So it is not like these countries have to adopt only a small part of EU directives.
2. Norway, Iceland and Switzerland are all part of the most prominent pillar of the EU bar none, the EU's border union, aka Schengen, which means they have removed their border controls with other EU countries, which is equivalent to high treason according to this 'think' tank:
http://www.civitas.org.uk/eufacts/FSEXR/EX2.htm
CIVITAS [Arguments against Schengen]
"Nation states need to be in charge of their own border security to protect their citizens from external threats such as foreign terrorists. (…) Free movement of people makes it more difficult to protect against other external threats such as infectious diseases like SARS or Avian Flu."
(You couldn't make this up...unless this was written in 19th century that is)
Did anyone bother to tell the governments of Iceland, Norway and Switzerland (and of course the other 25 Schengen members and would-be members) that they are committing high treason by refusing to protect their citizens from external threats such as foreign terrorists and infectious diseases? I think someone (I suggest Foreign Sec. Hague) needs to tell them with the outmost urgency.
Again, my point is this: Norway, Iceland and Switzerland are already more integrated with the EU than the UK itself, which is the only EU or EEA country that has refused to join Schengen, in turn forcing Ireland out as well. Not only they are more integrated with the "totalitarian superstate" but, unlike the UK, they receive their orders from them without having a say, let alone a vote, on the matter.
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#221 - Freeborn John
"This is the disingenuous guff that you are so well known for on here . . the time for listening to disingenuous federalist fellow-travelers like yourself is over".
I am delighted to hear it. At least if you are not listening, I will not have to put up with your boorish insults any more.
I did not argue in favour of Lisbon ratification. I accepted that it was be best deal on offer, that ratification was inevitable given the timing of the UK general election and that we would have to make the best of it. I have also consistently argued that I was unhappy with the lack of democratic accountability with which it was imposed. Your argument about the block vote completely disregards enlargement strategy, for which the UK has - so far with some success - argued in favour. Each enlargement changes the block vote balance as you know well - one reason why the Franco-German axis has set its face against Turkey.
Anyway, goodbye.
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@ huamek 218
"The currency having the same unchangeable value for strong economies and weak economies , outweighs any pluses"
Is this huamek's impartial expert analysis?
I thought you meant independent economic experts, preferably not from Eurosceptic think tanks, like the ones that are predicting that there will be no euro within five years.
To be honest, I cannot honestly say that with 100% certainty whether the Euro will survive 5, 10 or 100 years... or until the day of reckoning.
One thing is certain, though; if the euro is not going to exist within five years, the 16 Eurozone countries really need to start preparing *today*, otherwise they will have no means of trade and will have to reintroduce bartering in five years time.
It took far longer than five years to prepare for the introduction of the euro, so they really need to get a move pronto or be ready to trade with cows and horses in 2015.
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threnodio_II @#217
I do not disagree that the UK has an economy that is equal to that of France, a population of similar size of France (and likely to grow to that of Germany) and, dare I say it, the Anglo-Saxon mentality can be just as irritating to rest of the world as the French.
However, the problem with the suggestion that the UK needs to be IN the EU to influence and counteract the power of the German-French dominated EU is that this may have been true in 1973 (and one of the political reasons to seek to join the EEC as clearly Germany and France dominated that organisation) but, 37 years later what has changed with all the applied influence of the British politicians?
Germany still holds the purse strings of the EU (as witnessed by the kowtowing that went on to get Frau Merkel to sign up to the Greek bailout fund), France still dominates the politicisation and direction of the EU and, if anything, the constant barrage and propaganda of the EU is such that they now even suggest creating records of people who dare to criticise the EU as that behaviour is subversive.
The UK has failed to really influence the EU and has had to have opt-outs to try to prevent the EU dominating the British way of life into modern day serfdom where the voters are there to perform a function of maintaining a mask of democracy but the masters know what's best and so let the people vote for the sake of having a vote (but with no real effect!) and the masters get on with being rulers.
For a long while I have been pro-European but anti-EU and have sought to argue that the EU should become more democratic and thus answerable to the people of who are subject to decisions made in Brussels.
The problem is that 37 years after Ted Heath took the UK into the Common Market we have seen successive Westminster parliaments, hamstrung by ruling governments, into ceding more and more areas of susiduarity to the EU without the British people giving consent to that process - each and every time the Westminster has ceded power it has done so willingly but the beneficiaries have been the EU (and by nature of the setup the pre-existed the UK joining the EEC) Germany and France for political power and the poor EU nations for the redistribution of wealth - the UK loses every time and gets nought back except condescension.
An example of how little influence the UK has by being IN the EU was when Tony Blair agreed that the EU CAP would be re-reviewed and reduced as a share of EU spending by 2015 and agreed to reduce the UK EU Budget Rebate by 20% in advance. If the CAP is ever reviewed, reduced and changed in any way other than to continue to benefit France I will eat my hat!
The CAP was even a problem that needed resolution BEFORE Ted Heath signed the UK up to joining the EEC. 37 years later the CAP still exists and continues to deliver far to much EU funds to agricultural commerce and the only thing that changed in the interim was the creatioon of the UK EU Budget Rebate which has now twice been reduced.
If the CAP persists unchanged and the reductions in the EU Rebate continue then the UK will, eventually become the largest contributor to the EU with the Germany and France still calling the shots.
I now suggest, given that the EU now seeks to centralise more power to the EU and the fundamental flaws in the Euro have been disclosed, that now is an excellent opportunity for the UK people to review the particpation of the UK within the EU and see if we truly are influencing the EU or whether it is the EU influencing the UK - every time and all the time and not always to the benefit of the UK.
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Will recent elections in Belgium speed up its disintegration?
Does anyone care?
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Threnodio (223): To say that you are disingenuous is no insult, but the only conclusion one can reach from reading your posts. Take for instance this latest claim of yours that are “unhappy with the lack of democratic accountability with which it was imposed”. You are the one here most frequently making the specious argument that the Lisbon treaty is not the same in substance as the EU Constitution and therefore the Labour government was justified in canceling the referendum promised in its 2005 manifesto. And having made that argument repeatedly you now have the bare-faced cheek to say you are unhappy with way the EU Constitution/Lisbon was imposed!
“Dishonesty, thy name is Threnodio”
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@ 193. Menedemus
More on Switzerland's relationship with the EU:
"These negotiations resulted in a total of ten treaties, negotiated in two phases, the sum of which makes a large share of EU law applicable to Switzerland. (...) unlike full EU members, Switzerland has no influence over the contents of EU law that will apply. And while the bilateral approach officially safeguards the right to refuse application of new EU law to Switzerland, in practice this right is severely restricted by the so-called Guillotine Clause, giving both parties a right to cancellation of the entire body of treaties when one new treaty or stipulation cannot be made applicable in Switzerland."
http://en.wikipedia.org/wiki/Switzerland_–_European_Union_relations
Please note the statement:
"a large share of EU law (is) applicable to Switzerland (and ...) unlike full EU members, Switzerland has no influence over the contents of EU law that will apply. "
Very democratic indeed. And on top of that they are full members of Schengen (that one they did vote in a referendum) and there is de facto a dual currency situation, never put to a vote in a referendum.
http://en.wikipedia.org/wiki/Switzerland_–_European_Union_relations#Use_of_the_euro_in_Switzerland
So they are, to all intents and purposes, subsumed in the "totalitarian superstate". I hope when the UK leaves the EU and emulates Switzerland (without the quality of life, unfortunately) the Europhobes "do not let matters rest there".
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#193 Menedemus
Both America and the UK electorates have a common problem with their lobbyists, however Britain has an extra democratic hinderance which is the ´Oath of Allegiance´, that being much more than the ´Quaint Tradition´many believe it to be, as it is also pivotal to the discussion of ´Giving more power to the EU ´. I have twice posted links ( ´ Who Owns Britain ? and a British Government link to the Oath of Allegiance ) which should have rung bells in the heads of those anti-EU British contributors. Instead, the ringing was dampened by Nationalistic sawdust. The ´Enemy´is not the EU but the structure of British ´Politics´ itself.
How much Britain does or does not pay into the EU coffer comes second in importance to WHO GETS THE RETURNED SUBSIDES. That will determine whether Britain remains in or leaves the EU and if it does, how can the man on the street be made to pay the `lost money´to those who loose it. Only by the EU making it mandatory for the names and amounts of those subsides to be published did Brits learn where some of the money went. The ´Who Owns Britain´ article closed a part of the circle while suggesting massive legal tax avoidance schemes.
Cameron is also playing the Flag-Waving card and most UK Bloggers are more than willing to jump on the band-wagon without even questioning the pros and cons or what also could be behind it. The last thing ´Her Majesties Governments ´ want is its citizens to question its actions and ´Traditions´ before the EU courts. The Gerry Adams attempt to refuse the ´Oath of Allegiance´ was too close for comfort.
The British government righty fears that privileges which certain sections of society enjoy could come under attack. A simple example is why one can go broke just putting in offers to buy a flat or house ? In other parts of Europe the buyer and seller agree on the price and THEN legal assistance may or may not be required. When and if EU (and British) citizens can question such traditions is a nightmare for the British Elite -- That is probably the most important reason for NO MORE powers to the EU !
If you look at the EU and Britain from a different angle, the statements and actions of British governments become more logical, but not in the interest of the majority of its citizens !
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MaxSceptic
Re #226
Belgium.
Yes, I very much care!
On a personal level I have family & a home there: The Belgians of Walloon & Flemish persuasion are on the whole very fine, sophisticated people.
I can recall as a child in the mid-1950s an entire bar in Blanckenberg standing to applaud my father when they learned he was a D-Day veteran and a 'liberator' of Brussels.
Though times and people change it is a poor show to suggest the neighbouring Nation the UK assisted to its 'independence', again in August 1914 and thereafter should not be a concern in the 21st century.
Anyone with half an interest in & understanding of continental European history and its effects/implications for the British Isles would always be concerned about an area known as the 'cock-pit of Europe'.
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#225 - Menedemus
". . . 37 years later what has changed with all the applied influence of the British politicians?"
The list of areas in which the UK has been influential is actually quite a long one but rather dull. The two that come immediately to mind are enlargement - which the UK has always vigourously promoted and - yes I know if has been an arduous 40 year process - finally the EU has come round to a much more competitive and market driven concept of agriculture.
"Germany still holds the purse strings of the EU (as witnessed by the kowtowing that went on to get Frau Merkel to sign up to the Greek bailout fund)"
But does it? I would certainly concede that it holds the purse strings of the Euro zone but the EU as a whole?
"The UK has failed to really influence the EU and has had to have opt-outs . . . "
The famous 'red lines'. I think you are half right. The UK has demanded several of these but you have to bear in mind the mentality which is to fight all the way down to the last bell but then rigourously enforce the resulting laws. Contrast that with the French habit of agreeing to everything but only enforcing the rules that suit them. I suspect that this, as much as anything, is why the UK has the 'bad boy of Europe' image that it does not properly deserve.
" . . . the EU should become more democratic and thus answerable to the people of who are subject to decisions made in Brussels".
Absolutely!
As regards the CAP, I agree with you but the latest liberalising reforms suggest that perhaps some common sense is creeping into the picture. As I said, it has been 40 years coming and it is only a start.
" . . . now is an excellent opportunity for the UK people to review the participation of the UK within the EU . . . ".
Yes but a review is pretty meaningless unless they can draw conclusions which are then tested at the ballot box. We are back to the referendum again.
#226 - MaxSceptic
No more or less likely than before and no I don't particularly care . . . but it is interesting to see in the context of the Netherlands lurch to the right.
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Menedemus
Re #225
A 37 year situation of 'no change' that is about to be compounded by the axis-of-ill-intent otherwise known as Paris-Brussels-Berlin about to employ Qualified Majority Voting procedures to enforce its tighter regulation & oversight powers for future National Budgets.
So much for the sovereignty of Parliament!
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#226. At 12:31pm on 14 Jun 2010, MaxSceptic
As much as anyone cares if Scotland leaves the UK:))
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@190 MAII
"You'd better get out that economics 101 book and study it or at least get one from the library. As more currency is printed, especially in relation to actual growth of wealth it can buy, people who lend money want higher interest rates in the expectation that the value of what they will get back will buy less."
This does not contradict my statement at all.
If you increase the money supply, the interest rates fall.
The growth of wealth you are writing about will cause the demand for money to rise, as Md = pY x L(i). Therefore, a higher real income (Y) causes the interest rates to rise at any given demand.
According to the LM-curve at least.
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~213 Menedemus
'It is also interesting to note that at the same time that the UK was allowed to vote for and stayed in the EEC, Norway also applied to join the EEC but popular vote has kept Norway out of the EEC and outside of the EU. Have the Norwegians suffered as a consequence - no they have not and the Norwegians probably laugh at the hoops the British people will have to go through to get out of the EU now when all they (the Norwegians) had to do was vote "Nei!" in the first place ... something the British should have done in 1975 and now we cannot reverse!'
If I were a Norwegian, I 'd be quite happy to stay outside the EU while my economy was still comfortably sustained by fish and oil. But once those run out, I might take a difference view. I might want a seat at the table to have a say in developing EU legislation rather than (as the case at present) just accepting the vast majority of it.
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#227 - Freeborn John
"You are the one here most frequently making the specious argument that the Lisbon treaty is not the same in substance as the EU Constitution and therefore the Labour government was justified in canceling the referendum promised in its 2005 manifesto".
You are deliberately misrepresenting what I said. My argument was with those who insisted that the manifesto commitment was breached because Lisbon was simply the old constitution rebranded. This is manifestly not the case. There was therefore no breach of the commitment.
What I argued was that trying to say that Lisbon and the constitution were one and the same thing was spurious. However, I have also said throughout that the fact that they are materially different does not mean that Lisbon is not a treaty which makes major changes to the constitution such as to demand public consultation of itself.
I do not believe it is helpful for either side to resort to allegations which are so easily gainsaid. There is no inconsistency in my position at all. I regret the lack of democratic consultation notwithstanding the fact that Lisbon is a different document.
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@183 Threnodio_II
Being an eyewitness of all those dramatic events that shook the whole continent twenty years ago, I must say, that they were possible because the Soviets had loosen beforehand the grip over the eastern European countries, and virtually in weeks everything changed so quickly that even we, ordinary people were not able to predict what would happen, say, in the coming months. To that matter, you are right to remember us the role of Mikhail Gorbatshev who still believed that the Socialism could be “refurbished” and that the eastern Europeans were to make their own choice. True, Lady Thatcher did support the positive move from the totalitarian regime to a parliamentary democracy virtually in any country here. However, we were aware of another kind of dramatic change that along with the general euphoria somehow resurrected some ghosts of the past. That was the German reunification. Needless to say, on both sides of the English Channel, the comments that would come just before and after that were not at all single valued. There was some kind of fear in the air even here, in the southeastern corner of the continent…
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#229
A simple example is why one can go broke just putting in offers to buy a flat or house ?
Err, what?
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also about the geopolitcs thing, it is reported in some media today that US geologist estimate about 1 Trilion worth of mineral are discovered in Afghanistan! Specially minerals useful in battery production! I think the reason the German president left the office maybe was because he let the cat out of the bag:)
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"..Gerry Adams.. attempt.. refuse the oath.."!
"..who gets.. returned subsidies.."!
"..go broke.. buying house.."!
Is there a single item of UK History not in an orbit resembling a Ring of Saturn in this delusional mind?
SinnFein MPs do not swear an oath of allegiance & do not take up seats in the House of Commons if/when elected.
EU subsidies are paid to the UK Exchequer: UK Farmers receive monies from the CAP.
UK Legal Fees for handling the sale/purchase of a property are at a Fixed amount according to the estimated valuation.
Quote, "..if you look at the EU and Britain from a different angle..": It's as though Wallis & Grommit are concocting an alternate universe where shredded cheese supplies the oxygen!
ThrenodioII - - I know, I know, I'm my own silly-billy!
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#229
"The ´Who Owns Britain´ article closed a part of the circle while suggesting massive legal tax avoidance schemes"
I've asked you this before but see if you can answer it this time. WHICH TAX is avoided by owning land and not declaring it to the Land Registry?
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I guess I'd prefer Belgium to stay as Belgium, but if the people didn't want it to be that way (if they preferred Flanders to become part of the Netherlands, and Wallonia part of France and Brussels a sort of city state like the Vatican ) then fair enough, the place will survive under the EU umbrella. Actually if you drive from France to the Netherlands through Belgium the internal Belgian boundary is already more obvious that the Belgium /France or Belgium/Netherlands boundaries because when you drive from Wallonia to Flanders the place names on the road signs suddenly change without warning. You're looking for Mons and suddenly find you're being directed towards Bergen, which turns out to be the same place.
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#230 - cool_brush_work
Yes - I should withdraw my remark about Belgium. I was being frivolous.
I do not have the same family connections so the limit of my interest is that people anywhere should be free to determine their own future in what ever way they think is right. The same (Chris Arta) would be true of Scotland.
However, there are two causes for wider concern. There is not, as the BBC map suggests, a neat line between Flanders and Wallonia. It is a very scrappy border involving towns under two different local government regimes and settling a frontier would be complex and divisive. The other worry is whether Wallonia is of itself viable or whether we might see an enlargement of France - something we might all find uncomfortable.
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@ 236 threnodio
(to FBJ:) "You are deliberately misrepresenting what I said."
I would like to express my sympathy for threnodio as I think he is one of the most balanced and honest contributors to this blog (even if sometimes his line of reasoning escapes me). His pillorying by FBJ is just comparable to the bullying to which he (FBJ) subjected the previous BBC European correspondent/blogger because he (FBJ) thought he had a pro-EU agenda. Now that we have a BBC EU editor supposedly without an agenda but with clearly, or very thinly disguised, Europhobic convictions, he (FBJ) should be happy.
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@ 215 Nik
Hi brother.
"But Europeans have to reinvent their markets. They cannot play the same game cos others have learnt well this game and they will be mathematically beaten."
I totally agree. But shall we do it without a common market policy which requires common leadership, common defence etc.? The Babylone tower of Brussels still lacks a common language.
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@ 225. Menedemus
"I now suggest, given that the EU now seeks to centralise more power to the EU and the fundamental flaws in the Euro have been disclosed, that now is an excellent opportunity for the UK people to review the particpation of the UK within the EU and see if we truly are influencing the EU or whether it is the EU influencing the UK - every time and all the time and not always to the benefit of the UK."
Point one, the 'fundamental flaws in the Euro' are of no concern to the British people (who would have thought that given that sniping at the Euro and predicting its imminent collapse is one of the British favourite pastimes) as the UK is not in the Euro. Please do let the Eurozone countries in peace as they now need to start to get hold of as many cows, sheep and horses as they can in preparation for when they do not have a currency in 2015 or even earlier.
Point two, you can suggest as you wish, but may I suggest in turn that this 'excellent opportunity for the UK people to review the participation of the UK within the EU' is down to whether the elected British government, or rather, the elected British parliament, decides to let 'the UK people review the participation of the UK within the EU'. Sadly, there is not much sign that the elite are about to decide to let the plebs have a say. But please note: It is not the EU who decides that, but rather the Oxbridge elite who runs this country.
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We could learn so much from the UK...
A new oath of allegiance for MEPs towards the new EU president...
just so that Herman van Rompuy and Nigel Farage will know each other better.
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@243 threnodio_II
"The other worry is whether Wallonia is of itself viable or whether we might see an enlargement of France - something we might all find uncomfortable."
Uncomfortable? WHY?
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Doubtful that Wallonians would opt for even autonomy within a France constitution.
French are notorious for taking the mickey out of the different sounding Belge French language speakers; then there's practical things like most Belgian french-speakers regard the France Tax system as one of the few that is worse than their own & many Employers view the France Social Service system as a burden they couldn't accept under any circumstances.
The Flemings at one time looked longingly towards the Netherlands, however, the last decade of increasing Dutch social & political disorder (re: coalitions, Mr Wilders, but also, e.g. lax drug laws) and a self-determination political ethic seems to have the upper-hand.
The final and really immense issue is Brussels: A very divided city - - its ethnicity groupings rival London, New York etc. - - and it is the EU & NATO political-command centres.
Maybe a form of Brussels, District of Senne (Washington DC) will be a way out if the split occurs.
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JorgeG1: Mark Mardell always reported each story in a neutral way, as does Gavin Hewitt. Where they differ is in the stories they choose to cover. Gavin prefers to identify the major stories (of which the eurozone troubles is undoubtedly one) and revisit them on a rolling basis as events unfold. Mark Mardell preferred to jump about rather more between different stories, inevitably covering more minor ones.
Mark's broad scope of stories was well suited to a blog format but allowed him scope to bury a major story that might show the EU in poor light by flying out of Brussels to report trivial issues (quite often about fishing). This happened so often as to constitute a biased BBC editorial line despite his neutral reporting of whatever minor story he did cover. His burying of the CAP 'health check' (whose failure cost British tax payers ₤1 billion a year) by vacating Brussels for an Aberdeen quayside being perhaps the best example.
I don't want to see any bias at the BBC (including in an anti-EU direction), in either its reporting or the editorial selection stories to cover/bury. The BBC most certainly has had trouble in the neutrality of its EU coverage in the past. The last Europe minister in the Labour government (Chris Bryant) was Head of European Affairs at the BBC before becoming a Labour MP. I first heard of this blog on a list ot 'top 5 blogs where Labour can get out its message about Europe' where it appeared in #1 place. And i think Mark Mardell was too close to former MEP Richard Corbett and this may have slanted some of his reporting in the run up to the June 2009 EU elections including his infamous 'BNP in blazers' hatchet-job on UKIP on the eve of polling which perhaps ironically backfired in giving the BNP sufficient oxygen of publicity to unseat Richard Corbett. All i ask from the BBC is that they play a straight bat on the EU while still reporting and analysing factual events as they unfold. I think Gavin is doing good job at that and i doubt any of the usual federalist suspects here will be able to point out suspicious story selection or a pattern of slanted coverage on any particular topic that is reported on.
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JorgeG1
Re #246
For someone so excoriating about the UK and the English You certainly seem mighty comfortable in a land ruled by 'oxbridge' with the 'plebs' tugging their forelocks!?
Still, I guess anywhere is better after Spain where the only person on trial for crimes connected to the Civil War & Fascist regime era is a liberal-minded Judge who wanted to investigate the elitist rulers of Spain! And let's not forget those Basques - - my, they really admire Spanish rule!
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Because there are a little under 4 million Wallons who would them become French, an increase of about 7% over the current figure. The present population of 64 million gives them 12.9% of the EU total. With Wallonia, that rises to 13.7% and, although there is weighted voting, the basic rule is the number of votes at the Council is determined by the population.
Now add to that the fact that France is a net contributor but Belgium is a recipient and you would expect France to want to adjust its contributions downwards. In other words and put very simply - more voting power for less money.
Are you comfortable with that?
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#244 - JorgeG1
Thank you for that kind remark.
I am afraid I cannot concur with your remark at #246 about the UK being run by an Oxbridge elite but, if it was, they would still have to stand the electoral test.
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cool_brush_work @230,
I also have friends (Walloons and Flemings) in Belgium. I actually like Belgium (and Brussels): great art architecture and, of course, food.
A disintegration of Belgium would initially strengthen the EUrofederalists hand. But once the Flemings joined the Netherlands (which they would do) they would also agitate for succession from the EU.
Which is why, all in all, the EU wishes to strengthen the Belgian state (evn if it is a non-country ;-)
ChrisArta @233
Scottish independence would be a boon for England: no more dead-weight, and never again a Labour-led government.
What's not to like from an English perspective?
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@ 252 threnodio_II
"In other words and put very simply - more voting power for less money.
Are you comfortable with that?"
Put very simply... YES!
voting power should always be linked to population and not depend on financial contribution.
If not Greece's, Spain's and Portugal's voting power would be negative
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Somebody help me!
If the Flemish and Walloons are unable to work together in a common political union, how can anyone imagine that the many countries that make up the EU can?
Am I missing something? I mean we're talking about Brussels for heavens sake.
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MaudDib @256,
The answer is that they can't.
EUro-federalism is like a poor second marriage: the triumph of hope over experience.
It will all end in tears. (If we are lucky. Otherwise it will be the sticky red stuff).
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#213 Menedemus
Traditionally, Britain looked for a balance between (continental) European powers, in order to have a free hand at sea. When France was the dominant power there (late 17th - 18th century), it teamed up with others to defeat it (e.g. Holland, later Hannover, and then Prussia in 1815). When Germany become stronger, it switched to an alliance with France (WWI and WWII). After WWII, the EEC moved to encapsulate German power by its former enemies on the western part of the continent. The small states of the EEC advocated 'supranationality', contrary to France (De Gaulle) favouring a 'Europe of nation-states'. The equilibrium was found with the EU Commission proposing and the Council disposing. Since the UK joined, it looked for enlargement to dilute the French-German axis (i.e. it sought to balance this axis by teaming up with other states, as e.g. happened for the Iraq case). It succeeded in doing this for good with the 2004 enlargement.
I agree that the best thing now is for the UK to have a referendum on the EU, since the British influence is curtailed by staying outside the Eurozone and the Schengen area. Even so, I don't consider the UK a small power, comparable with Norway, Iceland or Switzerland: 1) it has nuclear weapons (though dependent on the USA for it), 2) the London City is an important global trading center, 3) it is part of the UKUSA agreement on signal intelligence, and maintains small sovereign areas in various parts of the world (e.g. Gibraltar, Cyprus) for this. True, one can see this importance diminishing w.r.t. newcomers such as Bresil, Russia, India and China, but such shifts take decades.
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257. MaxSceptic
Loved the eu-phemism....... :)
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I find it highly amusing that whenever there is a comment that espouses the UK going its own way that the pro-EU lobby immediately come up with all sorts of reasons why the UK should remain in the EU and the dire consequence of how bad it is for Norway and Switzerland to be outside yet-not-part of the EU. Yet, whenever there is a comment that attacks the EU as an institution or suggest that the EU is not fit-for-purpose, the same gang claim the British are the problem and everything in the EU is rosy and the UK can always leave.
All I ask is that the UK citizens be given the opportunity to vote - once and for all - to remain in or leave the EU.
Whether the UK is still a major league nation or not, whether the Euro is a great currency or worthless toilet paper, whether German cars are good or not, whether the EU CAP is a red line for the UK or a rubbish system to benefit agricultural commerce when the true wealth of Europe is generated by manufacturing, whether the EU is democratic or not, whether Greece and Spain have similar economic problems or not and whether the European Union should be federal or a union of nation states is all, and I do mean all, irrelevant to the simple question of whether the UK should remain in the EU or leave and go its own way.
What happens to the UK outside of the EU to my mind is something for the British electorate to consider but they really, really do need to be given the opportunity to say farewell and bon voyage to the EU (or not!) as they so decide by majority vote and to make their vote free of threats from the EU and with the freedom of speech within the UK for people to say freely what they think of the EU and whether it is good for the British citizens or just good for the politicians and business leaders.
Let the British citizens decide for themselves whether being in the EU is a good thing or not!
If the UK is worse off outside the EU then the UK will be no worse off than it was in 1972 before joining the EEC but the UK will be master of its own destiny and not held to ransom by qualified majority vote which may well determine that UK has to abide by decisions that it fundamentally disagrees with.
To that end, I really, really do hope that the EU really, really does push for national budget preview and even pushes that demand to fruition through qualified majority vote in the Council of Ministers. I am sure that that outcome will trigger Westminster Parliamentary calls for a national referendum on membership of the EU that the UK government will have to consent to.
Should the British electorate decide to have the UK leave the EU, the most important thing will be that the EU can go on as it is, the UK will be able to go its own way and whether the EU is undemocratic, democratic, good, evil, the EUSSR, enlarged by admission of Turkey - or not - and has 27 Commissioners or 100 such creatures ... you won't find many British citizens caring two hoots about the EU as it will be none of the UK's concern – you won't find me posting any complainst about how bad a decisison I made abaout leaving the EU as it would have been my decision and my responsibility ... at least the UK citizens (including me!) will have made our own choice and made our own bed to lie in.
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247.oeichler wrote: We could learn so much from the UK...
A new oath of allegiance for MEPs towards the new EU president...
just so that Herman van Rompuy and Nigel Farage will know each other better.
The unelected Rompuy is not EU president. The unelected Rompuy is chairman of the European Council, and no more.
228.JorgeG1 wrote: So they are, to all intents and purposes, subsumed in the "totalitarian superstate". I hope when the UK leaves the EU and emulates Switzerland (without the quality of life, unfortunately) the Europhobes "do not let matters rest there".
Can we (the Netherlands) leave too? We are sick of having to subsidize Greece, Spain and other countries rife with political corruption.
And one more thing: I'd rather be a 'Europhobe' than what you seem to be, namely a 'democracy-phobe'. Yes that's right, if you support the EU you are opposed to democracy, because the two are mutually exclusive.
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261 mvr512
The ELECTED Herman van Rumpuy is PRESIDENT of the European Council
You like it or not...
http://www.european-council.europa.eu/the-institution.aspx?lang=en
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260. Menedemus wrote:
"All I ask is that the UK citizens be given the opportunity to vote - once and for all - to remain in or leave the EU."
I agree even if I don't believe in the "once and for all"
1975 wouldn't have been "once and for all"
2010 wouldn't be either
New generations want also their opportunities to vote...
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oechler @#263
Yes, I cannot disagree that the next generation should also be able to ask for - and get - an opportunity to vote on staying, leaving or rejoining the EU (if the opportunity arises).
In fact, to be fair, it is 35 years since the last referendum so any British citizen under 52 years of age should be demanding - and getting - their bite of the British Referendum option NOW!
If they are under 52 but older than 35 they didn't get to vote in the 1975 Referendum because they were too young to vote and, if under 35 years of age,they were not even born so have grown up with the consequences of that 1975 referendum. As it is they should all get to vote in a referendum again as they should get the opportunity to have THEIR say as they are (a)now old enough to vote and make their own decisions in life , (b)have never, ever had the choice in whether to have the UK in or out of the EU and (c)it is funadmentally wrong that a vote should commit future generations to indefinite committment of membership of the EU.
I rescind my desire to have a vote that - once and for all - gives the UK a choice in membership of the EU. I think now we should have a UK Referendum every 30 years to decide whether to stay, remain or seek to rejoin the EU depending upon the results of the previous majority vote.
Of course, if the UK leaves the EU then there may not be an EU to rejoin 30 years later or the EU may not allow the UK to rejoin 30 years later.
I vote to have the Referendum now and let the UK's next generation take pot luck in 30 years time!
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#264 - Menedemus
You cannot have a referendum every 30 years. Where would it all end?
We have a bunch of fruitcakes here in Hungary who seriously believe that you can and should rewrite history so as to disregard the Trianon Treaty. They don't want much. Just most of Slovakia, all of Transylvania, a little bit of Serbia, most of northern Croatia and a great lump of Slovenia back. As I said, fruitcakes.
Britain has its fair share as well. People who seriously believe that great swathes of foreign territory that were once there's were either ceded by limp wristed lefties or stolen outright by the 'natives'.
Treaties, like them or not, are solemn and binding international commitments. You cannot revisit them from time to time. So have your referendum by all means. I support that argument, but then accept the result and live with it.
The Treaty of Windsor, the oldest alliance in recorded history (between England and Portugal), is still in force having been renewed in 1386. According to your argument, we would be beginning campaigning for the 29th referendum about renewal. The idea is absurd.
Make decisions, pass them into law and live with them for better or worse.
(Where have I heard that before? - Well, it wasn't a treaty was it?)
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And the beat goes on;
http://finance.yahoo.com/news/Moodys-downgrades-Greeces-apf-1321253625.html?x=0&sec=topStories&pos=6&asset=&ccode=
"LONDON (AP) -- Moody's Investors Service on Monday downgraded Greece's government bond ratings into "junk" territory, citing the risks in the rescue package for the debt-ridden country from the Eurozone and International Monetary Fund.
Moody's cut the rating by four notches, to "Ba1" from "A3," and also downgraded Greece's short-term issuer rating to "Not-Prime" from "Prime.""
The EU death spiral continues unabated. There's no stopping it now. Within two years Germany's bonds may also be junk...when they can't export to Greece anymore and pretend it's a profit for their side of the ledger.
With economists like Drugstore man who thinks that interest rates go down when there's inflation why should anyone be surprised.
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#265 Threnidio
Treaty of Windsor
Britain BREACHED the Treaty in 1961 !
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#265 Threodio
You are using half-truths.
http://en.wikipedia.org/wiki/Auld_alliance
Portugal held to the Treaty of Windsor during WWII, Britain BROKE it in while 1961 attempting to keep its foot in the ´Indian ´ door.
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247. At 4:09pm on 14 Jun 2010, oeichler wrote:
"We could learn so much from the UK...
A new oath of allegiance for MEPs towards the new EU president...
just so that Herman van Rompuy and Nigel Farage will know each other better."
EUpris: If they put enough pressure on me to swear an oath of allegiance to the "EU" or van Rumpoy, I might do it. I won't mean it. I will go home afterwards and use the Lisbon Treaty for the only purpose for which it is suited.
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247. At 4:09pm on 14 Jun 2010, oeichler wrote:
"We could learn so much from the UK...
A new oath of allegiance for MEPs towards the new EU president...
just so that Herman van Rompuy and Nigel Farage will know each other better."
EUpris: Please remember that many of the people who tried to assassinate Hitler had sworn an oath of allegiance to him.
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As far as I am concerned, the British people are entitled to have a referendum on membership of the "EU" or the Lisbon Treat every single day of the year every year if they so desire.
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Re: Switzerland.
When the UK leaves the "EU" I think we should not have a relationship with the "EU" like the one Switzerland has. I want us to be totally independent.
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271. At 03:01am on 15 Jun 2010, EUprisoner209456731
Of course you can have a referendum ,in Britain, every day if you want so.
If that is not gonna be democracy what else can be. What a brilliant idea?
I am waiting for that day and believe me I will watch with great interest the results of every day's referendum. Definitely, that is gonna make Britain the flagship of democracy.
I hope that will end all complains about the lack of democracy.
Very childish comments.
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EU Prisoner;
"As far as I am concerned, the British people are entitled to have a referendum on membership of the "EU" or the Lisbon Treat every single day of the year every year if they so desire."
If they had even a vestige of a spine they wouldn't ask, they'd take matters into their own hands. If their government wouldn't give them what they want, they'd exercise their inalienable right the founders of the United States of America asserted for themsleves and all people, "the right alter or abolish it [their government] and to institute a new government deriving its just powers from the consent of the governed." But they don't have the spine for it...or they just don't really care what their government does to them. It is as corrpt as any on earth.
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@243 Threnodio_II
“…so the limit of my interest is that people anywhere should be free to determine their own future in what ever way they think is right. The same (…) would be true of Scotland.”
If we go that way, we must agree that the same would be true of the Benet province (in Romania) which population is predominantly of Hungarian origin; the same would be true of Macedonia (where the main ethnic group is Bulgarian); the same would be true of the Basque province in Spain, and last but not least, the same would be true of North Ireland.
I love reading the history of Europe, and, what strikes me every time when I open some old book (I inherited from my late father, a scholar in history), is the fact that we, European folks are inclined to forget too quickly the lessons of the past, when it comes to discuss some local sensible issue which is complicated by some pure ethnic problem. The discussion over the Wallonia – Flemish country relationship is just one of the numerous examples.
I know both regions, and I remember that even the coins of the former BF were made in two languages.
Well, the Czechs divorced from Slovakia quite peacefully, and both countries remained in the EU. But they made that divorce on their OWN will. Both sides were more or less satisfied. That is what we often forget in our emotional move to follow the call of our (nationalist) sub conscience when it comes to solve some pressing interethnic problem.
(The orthodox Bulgarians are as nationalist as any other European nation, but they found the proper way of living in peace with the local Muslims, no matter that those ones constitute a minority of less than 10%).
Regards
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@262 oeichler
“The ELECTED Herman van Rumpuy is PRESIDENT of the European Council. You like it or not...”
Sorry to intervene. Well, it is true as a fact, it is true as a procedure of the representative democracy, and it is true as an embodiment of the central institutional power of united Europe…
However, it is also true, that it will take the time of at least one generation before any statistical ordinary citizen of the EU will accept Herman van Rumpuy (or the next gentleman) as his own president.
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275. At 06:10am on 15 Jun 2010, generalissimofranco
Interesting point.
I think there are many open wounds within Europe which were treated with salt by nationalism. If European people are to live in peace and together they have to treat and heal these wounds by dialog and understanding not with nationalistic discourses. However, the topic of this discussion is different. Still keep an eye on the rise of extreme nationalism in few of European regions. That cannot lead to anything good but trouble.
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@256 MaudDib
“Somebody help me!”
I have already called on the emergency. Just wait where you are. They will come in a minute.
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@ 277 Opinion
I totally agree.
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#243. threnodio_II wrote:
"... There is not, as the BBC map suggests, a neat line between Flanders and Wallonia. It is a very scrappy border involving towns under two different local government regimes and settling a frontier would be complex and divisive."
There is actually a model solution to this in what happened at the German/Danish border in 1920.
In at least one small town, the border divides the length of main street - no problems evolved, because although they now lived in different countries, people knew each other and were friends across the language line beforehand. One hitch, though, on the Wallon/Vlams border smuggling wouldn't be worth the trouble :-D
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245. generalissimofranco wrote:
"... But shall we do it without a common market policy which requires common leadership, common defence etc.? The Babylone tower of Brussels still lacks a common language."
Volapük?
Nobody understands it anyway so that would be a great common ground for everybody learning just one single language and no competition for this or that national language.
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@276. generalissimofranco
I agree
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"When the UK leaves the "EU" I think we should not have a relationship with the "EU" like the one Switzerland has. I want us to be totally independent."
Unless you somehow manage to convert the British Isles into a spaceship and fly them to a different planet or at least next to a different continent, what you have got in mind for them is not practicable.
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@282 oeichler
The issue of shaping of a pro-European mentality is as old as Europe itself. In Eastern Europe, the political elite was virtually “removed” in the aftermath of WW2, a fact that embarrassed even more both the social and the economic progress here. The iron curtain had not only a physical dimension, it was (first of all) a spiritual segregation of our folks from the other European nations. We still suffer the negative consequences of that half-century isolation.
True, our youngsters are already in good command of the foreign languages, of the computer softwares, etc. They do not fear the authorities (like we did in the old days), and, consequently, I believe (contrary to many errors of some people of my generation /I am 62/), that they are more open to the idea of a united Europe. That is the chance also for the west (European) nations in their effort to overcome the historic accumulation of prejudices and mistrust that still embarrass the irreversible progression of the integration progress.
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Quietoaktree;
I notice that, despite having posted recently, you have decided not to explain the following points you made in #229:
"one can go broke just putting in offers to buy a flat or house "
"The ´Who Owns Britain´ article closed a part of the circle while suggesting massive legal tax avoidance schemes"
Now, you are the first to demand explanations and apologies when you dont like the responses you get, so kindly practice what you preach.
1)How can someone go broke by just putting offers in to buy a flat or house, when the legal process doesn't start until an offer has been made and accepted? I get the feeling that you tried to buy a flat, didnt understand what you were doing and got burned? That would explain your obsession with Britain's property market.
2)No taxes are payable by merely owning land, so how does withholding information from the Land Registry lead to tax avoidance? Which tax is avoided? I would love to know, because as a land owner I would love to know how to avoid paying tax so if you could enlighten me with your vast expertise on the subject that would be great. Thanks.
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#274
"the right alter or abolish it [their government] and to institute a new government deriving its just powers from the consent of the governed."
Am I right in thinking that No US President or Vice President has ever been thrown out of office? Wow, thats some backbone, I'm in awe. Good luck with getting rid of Obama, all the talk of throwing him out of office is just that...talk.
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@286 commonsense_expressway
NIXON was pushed out and resigned and was later pardoned by his successor, Gerald Ford, for any federal crimes he may have committed while in office.
A weird concept of democracy
But KENNEDY was "thrown out"... more or less...
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Re #267 & #268
These 2 contributions are:
Foolish ignorance of history, piled on unrivalled anglo-phobic drivel compounded by grossly distorted hypocrisy.
Had the UK Government in 1961 acceded to Fascist Dictator (Salazar) led Portugal request for British Military assistance in the Indian Ocean they would have been in breech of international law and supporting a violent suppression of a legitimate 'self-determination' movement.
Thus, the shambolic 'phobia' reaches the extreme whereby the writer of #267/268 claims the UK is at fault for NOT breeching international law and for NOT aggressing a colonial peoples' independence!
Basically #267/268 are the clearest example yet of someone unable to distinguish their own argument/viewpoint or follow any logical pattern of thought.
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254. At 5:28pm on 14 Jun 2010, MaxSceptic wrote:
Scottish independence would be a boon for England: no more dead-weight, and never again a Labour-led government.
What's not to like from an English perspective?
Unless you're an English Labour supporter, presumably, (ie one among a substantial proportion of the English electorate).
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274. At 04:25am on 15 Jun 2010, MarcusAureliusII wrote:
"If they had even a vestige of a spine they wouldn't ask, they'd take matters into their own hands. If their government wouldn't give them what they want, they'd exercise their inalienable right the founders of the United States of America asserted for themsleves and all people, "the right alter or abolish it [their government] and to institute a new government deriving its just powers from the consent of the governed." But they don't have the spine for it...or they just don't really care what their government does to them. It is as corrpt as any on earth."
I may be mistaken but here, I think, is heard the authentic voice of the 21st-century American backwoodsman, living in the most highly-developed industrialized country on the planet and hankering wistfully after an 18th-century arcadia that (of course) never actually existed except on a piece of paper called "The Declaration of Independence", drawn-up by a bunch of expatriated English country-gentlemen who had read their John Locke and wished to dress-up treason in high-minded language.
Ah but of course I must be mistaken...
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Is it true the Baroness Cathy Ashton is Hermann van Rumpey in a wig?
I mean, has anyone ever seen them both in the same room?
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'262. At 9:24pm on 14 Jun 2010, oeichler wrote:
261 mvr512
The ELECTED Herman van Rumpuy is PRESIDENT of the European Council'
He is president only in the French language sense (= Chairman) . He has no real power. If the members of the council vote against him, there's nothing he can do about it. The Council Members' allegiances are to their own countries, not to the 'President'. He can't sack them or demote them; the most he can do is set the agenda, or try to use his powers of persuasion.
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@ 260. Menedemus
"All I ask is that the UK citizens be given the opportunity to vote - once and for all - to remain in or leave the EU."
Are you denying your children, grandchildren, etc. for the opportunity to vote – once and for all – to remain or leave the EU?
Besides, who in the "pro-EU lobby" in this blog is against that? I for one have endlessly repeated that I am totally in favour. Despite me repeating this ad nauseam, the usual Europhobe parrots continue to accuse me of being against democracy and wanting to shove the reincarnation of Stalin down their throats.
Well, that's what parrots do, don't they?
One interesting – even if totally hypothetical - aspect about this "opportunity to vote to remain or leave the EU" - exclusively denied to you by the Oxbridge clique who – now for definite – runs the country - is what would be the question posed to the people, and how many options:
For starters, the option "to remain" is unclear. To remain where? As it is as sure as death that the UK is not a full member of the EU in the sense that it is the only country that has remained outside of the two pillars that essentially differentiate the EU from its predecessor, the EEC: the Euro and Schengen.
So then, what you would have (if it was to be an honest referendum) is a referendum with three options:
1. Fully join the EU, i.e. renouncing all opt outs
2. Remain as sole member of the EEC of the 1980s
3. Leave the EU/EEC altogether
And the answer would be: Option 2; GUARANTEED, for two reasons:
1. The British people are terrified of change
2. Option 2 would be seen as a 'safe' middle ground compared to the two leaps to the unknown represented by 1 and 3.
So basically, after all this effort we would be back to square one. I would say that the only advantage would be that the parrots would quieten down and, a.o. things, stop accusing me of espousing a totalitarian superstate, but that would only be a temporary truce.
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Continuation of my previous post:
And the answer would be: Option 2; GUARANTEED, for THREE reasons:
1. The British people are terrified of change
2. Option 2 would be seen as a 'safe' middle ground compared to the two leaps to the unknown represented by 1 and 3.
3. All three major British parties would support option 2 (given that not even the LibDems support joining Schengen: they have fallen victims to the 'keep-our-borders fundamentalism' as it seems that this is now part of the training to become a full time career politician).
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@247 (contd)
"It is as corrpt as any on earth."
And, to talk of pots and kettles when it comes to corruption...This comes from a citizen of a country whose government (regardless of party) is in thrall to big business, whose politicians shamelessly and openly deploy influence over the distribution of the pork-barrel in order to buy votes, and have resisted every effort to restrict campaign-contributions or to control lobbying, and so on, and so on...
It would be interesting to learn what definition of "corruption" puts the UK's political system towards the topmost in the world whilst not putting the USA's even higher.
(No, on second thoughts: it would be incredibly boring - as well as being way off-topic)
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torpedo;
These were not the words of soome English gentelman philosopher writing some abstract book in the peace and quiet of a country house but of revolutionaries who risked and pledged their lives, their fortunes and their sacred honor because they knew that should they not hang together but lose the war, they would surely hang separately. Jefferson, Adams, and the other founding fathers may have gotten some of their ideas from Locke and others but the American revolution was entirely original. And I'm sure Locke would hardly have been impressed that one of their motives for revolting was money, a major consideration for them.
These are not just human truths for the 18th century or the 21st but the 31st, the 41st, the 51st, the 81st or as Lincoln put it down through the last generation. Their ideas have not been negated by the history of America but expanded in scope and in whom they cover. Now they seem to be encompassing the entire population.
America is not Europe or some souped up perfumed version of a European thought, it is an entirely original invention. How much more could Europeans show jealousy for it and what it has become by in one breath characteristically trying to steal credit for what is not theirs and in the next condemning it. Yet the fact remains when you get past it all, American civilization and the American experiment is the most successful in human history and has far eclipes Europe and everyone else while Europe's latest "experiment" is a fisasco like somthing out of Doctor Frankenstein's laboratory.
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@283 Chris Camp
I would complete your post by saying that if the UK withdraws from the EU, the authorities there should police very diligently the borders thus preventing their own citizens from fleeing old Britain (just like we did before 1989 in Eastern Europe). Fortunately enough, the pessimism of some of our fellow bloggers here is far from being shared by the crushing majority of the Brits. They insist on more representative, democratic and efficient coordination activities of the institutions in Brussels.
By the way, the Eurotunnel did change a little bit the meaning of the pure geographical term “island”. You may ask all those thousands of mainland folks who debark on Victoria station each day what they think about…
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@281 St_John
Volapük, Ido and Esperanto were really good intended attempts to make the Europeans more friendly and more trusting when communicating between themselves. However, all those three languages did not prevent them from waging two great wars.
Here in the East, the English won definitely the language battle thus filling the gap that opened in the aftermath of the cold war when the Russian was no more compulsory in many public schools.
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@265 threnodio_II
"You cannot have a referendum every 30 years. Where would it all end?"
You cannot have elections every 4 years. Where would it all end?
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283. At 08:07am on 15 Jun 2010, Chris Camp wrote:
"When the UK leaves the "EU" I think we should not have a relationship with the "EU" like the one Switzerland has. I want us to be totally independent."
Unless you somehow manage to convert the British Isles into a spaceship and fly them to a different planet or at least next to a different continent, what you have got in mind for them is not practicable.
----------------------------
No no... Chris. He is right! Totally independent. That is how British people want it. Respect...
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JorgeG1 @#293/#294
Did you not see my revision at #264.
Actually you make a good point. If my #260 is read in isolation, you are quite right to give me poor marks for not allowing my children and grandchildren (i.e. future generation) the right to visit and revisit the lofty ideals of 1975 when the UK had a referendum that has committed all of the British People currently younger than 52 years of age to what will be a lifetime of their country having ceded sovereignty on some areas of their lives to the control of the EU.
I think it is only really fair that this surrender of sovereignty should be visited and revisited every so often as you are quite right to say that I had , at #260 not considered the importance of future generations being saddled with the decisions of their forebearers.
In #260 I make it clear that I now consider that the question posed in 1975 to the British People should now be revisited - 35 years after it was agreed to join the single market called the EEC or more commonly then named the European Common Market - and see if the British People want to join the EU.
Oops, I forgot, we have never been asked THAT question as the EEC is nothing like the EU!
Perhaps we should have the same sort of question of the British Electorate as was asked in 1975, "Do you think the UK should stay in the European Union?".
If that singular question asked in 1975 was good enough then, I am sure it is good enough now. Just let the majority of voters decide is all I ask and now suggest that the question be asked every 30 or 35 years or so.
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298. At 1:23pm on 15 Jun 2010, generalissimofranco wrote:
"""Here in the East, the English won definitely the language battle thus filling the gap that opened in the aftermath of the cold war when the Russian was no more compulsory in many public schools."""
Which is of course wrong since Russian for most Slavs is quite easy to learn due to linguistic proximity, then easterners are actually cutting skills that in the near future will be certainly needed for their own financial development.
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274. Marcus
'If they had even a vestige of a spine they wouldn't ask, they'd take matters into their own hands. If their government wouldn't give them what they want, they'd exercise their inalienable right the founders of the United States of America asserted for themselves and all people, "the right alter or abolish it [their government] and to institute a new government deriving its just powers from the consent of the governed."'
Yea, states in the southern US had plenty of spine but things didn't work out so good. Talk and death are both cheap.
It's a funny thing about "founders". The farther removed you are from them the more ambiguous their words of wisdom become. For example, the phrase "freedom of religion" is now interpreted "freedom from religion".
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#268 - quietoaktree
You excel yourself. Only you could claim that Britain broke a treaty between Portugal and England then post as your evidence a Wikipedia entry about a treaty between Scotland and France.
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242. At 3:23pm on 14 Jun 2010, Wonthillian wrote:
"""I guess I'd prefer Belgium to stay as Belgium, but if the people didn't want it to be that way (if they preferred Flanders to become part of the Netherlands, and Wallonia part of France and Brussels a sort of city state like the Vatican ) then fair enough, the place will survive under the EU umbrella."""
Actually Flemish, while historically view themselves as belonging linguistically, culturally and tribally to the Germanic group of the Dutch people (don't call any of them "germanics" they will beat you blue), they currently do not wish any integration to Holland but would rather prefer either independence or a full federal division (i.e. passing all powers to the 2 federal states maintaining a government of Belgium only for the record and to accompany the fossil king in 1-2 celebrations). Wallons on the other hand were hardly ever thought of themselves as getting independence and having a Walon country, they will find themselves in a landlocked country, thus in so much need of connection to the French side that they might as well join as yet another department of France. As for Brussels, this was the traditional borderline city between the two communities. Originally (I mean after the arrival of germanic - don't call them germanic - people in the area pushing southwest the celtics) it was developed as a Flemish city, however much of the Flemish population of the city in the 19th century became solely French speaking. Yet neighbouring villages were solely Flemish while the first French ones lie at a considerable (for Belgian standards) distance in the south. Thus Flemish claim Brussels too which puzzles all foreigners of course (who consider it such an ugly city raising the question "what for? "what are you going to do with it?)".
if they don't get Brussels too but which should be nuderstandable as
Flemish view Brussels as an integral part of Flandres and they won't get their independence without it.
"""Actually if you drive from France to the Netherlands through Belgium the internal Belgian boundary is already more obvious that the Belgium /France or Belgium/Netherlands boundaries because when you drive from Wallonia to Flanders the place names on the road signs suddenly change without warning."""
I do it several times per year. It takes me 1 hour and 20 minutes to cross Belgium from France to Netherlands from Valencienne to Antwerpen. Only after several trips I realised that the Dutch-Flemish borders are where the wind generators are placed (on the limits of the Belgian side). The French Belgian border has a remnant of the old control point, so you have to slow down - you can see a monumental structure but only at a short distance since the road has a turn and around there are plenty of trees obstructing the view (good thing, this construction is horrendous). There is also 60s cantine on the French side where only truckdrivers make a small pause.
I love crossing the Belgian side, the road aids you cruise it at a nice pace unlike the French side which has a couple of radars and some junction were you are obliged to slow down to 110km/hr.
"""You're looking for Mons and suddenly find you're being directed towards Bergen, which turns out to be the same place."""
Really??? I have at last learnt where is this Bergen!!! Haha!!
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#275 - generalissimofranco
You are right about all of the examples you quote and there are others - Brittany, Corsica, Sardinia - even Cornwall if you want to be really silly.
My point is that at present the EU is comprised of more or less manageable nation states. You could break them up into credible sub-units and have the EU as a confederation of small regional entities or you can amalgamate the whole thing into a vast federal superstate. Neither solution is particularly credible and neither will satisfy the vast majority of regulars here.
Current thinking appears to be that the Wallons do not particularly relish being absorbed by France and the Flemish seem to be waning in their enthusiasm for union with the Netherlands so it is probably academic anyway.
The conflict is between assuring the rights of people providing they have been established at the ballot box and proceeding sensibly and pragmatically in what could otherwise become complete chaos.
My point still stands. You cannot possibly give the choice about something as significant as this (vis-á-vis the UK) every 30 years.
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JorgeG1
Re #293
That's curious (1)?
You have 3 times that I recall mentioned 'Stalin' but I cannot find any reference from anybody else to it and Your specific contributions!
That's curious (2)?
You have so far on 3 occasions over recent Blogs neglected to respond as to why you are so anti all things UK/English Government systems, Britons' attitudes/newspapers/education etc. and yet decline to explain how come You reside so long in that wretched plot 'England'!
That's curious (3)?
What sort of 'oxbridge' clique is it that is so different from the brightest/best educated currently ruling Spain unless of course You are admitting the reason Spain has 40% unemployment among under 25 and a basket cas Economy is due to its Government consisting of uneducated, unintellectual dummies!
That's curious (4)?
"..British people are terrified of change..": So, that 50 to 60,000,000 UK population with a Referendum voting 'Yes' to the EEC, 3 'politically' devolved Union Nations, near complete privatisation of 'nationalised services', a range of multi-cultural society secopnd only to the USA, and not forgetting the complete re-working of its economy in the Thatcher era is according to You, **afraid**!
You try to give the impression You live/know Britain, but in reality Your writing reveals You have only the slightest knowledge or understanding of any thing to do with the UK or its Citizens in the last 3 to 4 decades!
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@ Menedemus
"Oops, I forgot, we have never been asked THAT question as the EEC is nothing like theEU!"
You are right and wrong at the same time, depending on how you look at it.
You are right only in the sense that the UK is *nominally* a member of the EU
You are wrong in the sense that the "emperor has no clothes". As I stated in my previous post, when you boil things down, the only REAL, REAL, differences that separate the EEC from the EU are two: the Euro and Schengen. As the UK is part of neither of them, can you honestly say that what was voted in 1975 and where the UK is now – the sole member of the EEC of the 1980s - is essentially different?
If you take away the Euro and Schengen the rest is largely window dressing.
Yes, there are more decisions now taken by QMV. Big deal. Does that make the EU and the EEC essentially different? Nobody reasonable would defend that.
Yes, we have now van Rompuy and the British Baroness. That, IMHO is just window dressing, a new front shop that the EU has designed for itself.
Yes, there are other institutional changes and 12 additional EU members (largely following the endless EU expansion advocated by the UK), but I cannot see how those institutional changes and 12 additional members fundamentally change the nature of the EEC/EU if you take away the Euro and Schengen.
You should acknowledge at least one thing: The Europhobes have succeeded in freezing the UK in a limbo of its own, ensuring that what was voted in 1975 and where the UK is now is essentially the same.
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#305 - Nik
"Really??? I have at last learnt where is this Bergen!!!"
Amazing! Have they moved it?
Last time I was in Bergen, it was in Norway.
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@296.
CommodusAntoninus's_Pa_II
Your rant only makes my point. Please believe me when I say that the last thing that motivates me is envy of the USA. There are few countries among those belonging to "the West" that I would less desire to live in, not least because the simplistic half-truths you peddle are believed-in, alas, by all too many of the more benighted among your fellow-citizens (to give only one example, that intellectual giant among American politicians Sarah Palin). I was once a fervent admirer of your country and several among its great men and women are still among my heroes but it grieves me to say that as a nation you've totally lost your way.
But what I don't get is what's in it for you, an American, with all this gratuitous mud-slinging at Europe and Europeans? We have enough loonies of our own (some of them posting here) without needing any more from across the pond.
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@302 Hik
“298. At 1:23pm on 15 Jun 2010, generalissimofranco wrote:"""Here in the East, the English won definitely the language battle thus filling the gap that opened in the aftermath of the cold war when the Russian was no more compulsory in many public schools."""
Which is of course wrong since Russian for most Slavs is quite easy to learn due to linguistic proximity, then easterners are actually cutting skills that in the near future will be certainly needed for their own financial development.”
Hi brother. I tried to report correctly what happened. We certainly lost more than one can imagine. Being a graduate from a Russian naval academy I can assure you that the Russians have an amazing scientific data record that would serve any technical nation to develop high technologies, provided it has technicians/scientists/entrepreneurs that are in good command of the Russian language.
Needless to say, the issue has also a political and economic meaning. Russia is still somewhat isolated for many reasons, one of which is the relatively poor interest among the west (European) nations in learning and in improving their knowledge in Russian. They are wrong of course. Russia is a Christian and secular society which could successfully assist the EU not only through the economic cooperation. For many Europeans it is still ‘terra incognita’.
Nik, may I invite you on the Russian blog:
[Unsuitable/Broken URL removed by Moderator]@
Alice is there, as well as several Poles, Ukrainians, Czechs, etc. You will not have much trouble in chatting with me and Alice first, in English of course. Just fill in the registration form with you nickname and your e-mail address. I shall be waiting for you there.
Of course, if any of our fellow bloggers here present are interested in chatting with all “those bloody Russians”, he is welcome of course. Alice and Generalissimofranco are there.
I wonder if MarcusAureliusII will join us there. The Russians will put him on a slow fire before eating him alife. Markus, clean the desk and go to Smolensk man!
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