I hope the following will clarify the succession of bizarre events taking place in Europe as the euro fights against all reason for its existence.
The whole of Europe is in an economic and financial shambles for several reasons.
BACKGROUND: The original founders of the first European “union”, principally Jean Monnet, Robert Schuman, Konrad Adenauer, Charles de Gaulle et al, were convinced that only the creation of a European superstate would put an end to endless European wars for all time. Leaving aside the fact that they seem never to have read about the multiple civil wars arising because people(s) with different cultures, ideas and principles were forced together, this was a project never overtly explained to the Europeans. The idea was to achieve this by stealth through a number of small but incremental and irreversible steps. This is all outlined very clearly on the following site: http://eurealist.co.uk/jean-monnet-that-elusive-quote/
The people of Europe were to be led like lambs to this superstatehood; as little direct choice as possible was to be offered to them. Thus the British voted purely on a “Common Market”, but since then the EU has turned into something completely and utterly different, to the point where much of Britain’s sovereignty has been abandoned. The Brusselomafia (for the above-mentioned reasons – the Europeans being too dim to know what is good for them) hate referendums, and do their best to avoid them. In those few cases where they have unavoidably taken place with negative results the people concerned have had to vote again until they got it right. The most blatant case of Euro-fascism was when the EU, France and Germany teamed up to force the democratically-elected PM of Greece out of office for daring to propose a referendum on the euro to his people.
The Eurozealots clearly believe in the rightness of their mission, which as usual has led them to putting the ends above the means. Nobody faults their good intentions per se, only their judgement and lack of faith in – and one could say contempt of – the people.
THE EURO …
1) …. was a political construct based on the above-outlined principles and specifically (the ends justifying the means) on a combination of lies and complete denial of economic reality and indeed commonsense. The project’s instigators were told by their own economists that it could not work without full financial/economic and thus political union. Not one single European voter has ever voted for the latter, but that is a fact of supreme irrelevance to the zealots who launched it. Their entire project is as explained above based on introducing a USE by stealth against the wishes of the people of Europe. The particular step of the euro was no doubt considered by Eurozealots as “a great leap forward”, but in pushing it so hard they may have shot themselves severely in the foot and delayed their master project for many years.
2) Once the euro was in place most participants – and in Southern Europe in particular – threw themselves into a frenzy of spending and borrowing, aided and abetted by grasping, greedy and stupid banks who have vastly over-extended themselves. The vast over-borrowing was accompanied in many cases by almost blatant corruption allied to idiocy, with Spain getting the funds to build twice as many airports as Germany and Portugal getting infrastructure payments for motorways on which hardly anyone travels.
Efforts to prop up the moribund eurodinosaur have been inspired not only by the zealots’ lunatic and totally unmandated dream of a United States of Europe but also by desperate efforts to save ludicrously-overextended French and German banks from collapse if the euro broke up.
3) European leaders (there’s a funny idea) have MASSIVELY overborrowed and overspent to the point where economic collapse and default threaten almost everyone except Germany.
The whole eurosaga is absolutely fascinating from any number of viewpoints, not least the psychological one. From the increasingly desperate and hysterically-convoluted machinations we have witnessed over the past few years it is fascinating to see the following desperate searches by our leaders:
- … for some sort of magic solution which will fix the problems without pain, and especially without their losing their grip on power.
- …. for someone else to blame for it all.
Concerning culprits, there have been a succession of usual suspect candidates rotating in popularity, including: the ratings agencies, the banks, the Anglo-Saxons in general, the USA, mortgage traders, hedge funds, China, the Greeks, Spanish and Portuguese, capitalism itself, the Fed and the ECB.
The funny thing is, I have yet to hear of any of the people actually responsible for this farrago of lies and incompetence accepting any of the blame themselves. It is also important top note that the PEOPLE of Europe have had NO SAY in all this and are ENTIRELY INNOCENT of the damage caused by the euro. On the other hand, these people did elect cretinous governments, and so must take indirect blame. Indeed, the people of Greece even RE-ELECTED the same tired, old, venal and incompetent politicians responsible for Greece’s plight in the first place. One might conclude that the people of Europe are indeed stupid, but only insofar as they trusted the traditional parties that went along with the eurodisaster.
But the hysterical thing is that now Germany herself has joined the other usual suspects, and why? Because it is exporting too much!
A quadroika of unlikely bedfellows – Christine Lagarde, Dominique Strauss-Kahn, the US government and the EU Commission – have all called at one time or another (and the latter two most recently) for Germany to reduce its exports. The EU is even gearing up for a potentially catastrophic legal spat with Germany, without whom the entire EU could collapse if German public opinion is wound up and insulted too much. They already have to put up with calls of NAZIS and their Chancellor caricatured with a Hitler moustache in Greece, a country to which they have given BILLIONS.
“The European Commission has warned Germany it could face disciplinary action for running excess trade surpluses at the expense of EU partners, joining the US Treasury in criticising Berlin for doing too little to help lift Europe out of its slump.” http://www.telegraph.co.uk/finance/financialcrisis/10428955/EU-opens-door-to-showdown-with-Germany-on-trade-surplus.html
Now, I am not an economist (to be honest, economists have not enjoyed the best of images in recent years and secondly why should we leave all discussion of the economies of the world to them?) but here goes ……
On the face of it, this demand of Germany to cut its exports is surreally ludicrous.
A) When Mercedes gets an order for n number of cars from China, what is it supposed to do? “Sorry Mr Zheng – we have sold our quota already and cannot sell you any more.” How are Mercedes workers and shareholders supposed to react to that? Will it be allowed to sell the Mercs to France to resell on to China?
B) It is only Germany that is preventing a total collapse of the entire European economy. Only Germany retains true credibility, thanks mostly to its export success. Only Germany has helped to maintain the value of the euro, without which oil and food imports would have rocketed. Yes, a high euro is bad for exports, but according to the EU, exports are bad anyway. And in any case if Italy and the rest of the Club Med would like a LOWER-valued currency to boost their exports, then they can exit the euro which was NEVER going to be able to accommodate them all in the same currency as Germany. Remember, they were TOLD this and IGNORED it. So, as ye reap so shall ye sew.
Sadly, it is Human Nature to want your cake AND eat it, but Greece et al CANNOT both be in a currency union with Germany AND retain control of the exchange rate of that currency. This was ALWAYS CLEAR but – as I said – arrogantly and stupidly ignored by the people responsible.
C) Germany at the time had no particular desire to give up its precious Deutschmark, but was dragged into it by the demands of France and others, using – as ever – residual German WWI & II guilt as moral blackmail. To prove themselves “good Europeans” the Germans went along with it, especially as they were promised there would be strict rules and they would never have to bail out the rest.
As for the “strict rules”, Greece for a start was allowed into the eurozone despite blatant falsification with the help of Goldman-Sachs of its financial data in order to meet these “strict rules”.
Once the doomed currency started, Eurozone members were supposed to keep strictly to a borrowing maximum of 3% GDP, yet almost all countries rapidly exceeded this during the early days as growth was slow and spending had to be kept up to avoid having to take difficult decisions with their own voters. None of these national leaders had the courage to tell their voters that the country was living beyond its means and there would have to be cut-backs. Much easier of course to borrow more to fuel “growth”. France is a special case: when challenged about its breach of the limit, a French spokesperson said: “That rule was designed for little countries, not those like France.”
So, returning to our sheep, Germany is now supposed to increase wages, stoke up inflation and reduce exports in order to stimulate the French economy. In other words, it is the Germans’ fault ……
…. which is of course hysterically idiotic and stupefyingly hypocritical:
- The French have not set a balanced budget since NINETEEN SEVENTY-FOUR. In other words, they have been living beyond their means for nearly FORTY YEARS.
- They have just about the highest proportion in the EU of GDP spent in the public sector.
- To sustain this vast state edifice they are by some measures the highest-taxed country IN THE WORLD.
- They have extremely high costs imposed on employers for employing people and highly-restrictive employment regulations running to over THREE THOUSAND PAGES compared to the 70 of neighbours Switzerland, hardly a failing country.
- Since the socialists came to power last year the French government has imposed or raised over EIGHTY-THREE taxes, many totally new.
The French social fabric is cracking. Only last week the government – as usual – backed down when faced with demonstrations in Brittany. Even EU Vice-President Ollie Rehn said “The French cannot take any more taxes.”
Despite all this, the Germans are supposed to reduce THEIR taxes to increase German inflation and cut exports even as the French massively increase theirs. The Germans are thus to be punished for holding their own wages low, improving productivity and competitiveness and being highly productive in making things the world wants. In effect, the EU and France want Germany to be pulled down to the level of all the rest in the name of “solidarity”. It is apparently not fair that Germany is doing well; clearly, the fact that France is a basket-case is the fault of German exports. (you could not make it up.)
Here are a couple of extracts summarizing this particular soap-opera, with the French Fairy Princess on the one hand and the Wicked German Witch on the other:
March 17, 2010: “French Finance Minister Christine Lagarde sparked a bitter row with an interview published in the Financial Times Monday in which she called on Germany to curb its export surplus. She reiterated her position Wednesday in remarks to the French radio station RTL, when she said that Germany could reduce taxes to boost domestic demand — which would free up more money to buy French products. “An improvement in domestic consumption could help our exports to Germany, our most important trading partner,” Lagarde said.”
The German riposte was swift and decisive:
“Earlier on Wednesday, deputy government spokesman Christoph Steegmans had said that it was not possible to tell export-oriented companies to produce less attractive goods. He stressed that Germany currently had strong and innovative small and medium-sized companies – the famous Mittelstand that is behind much of the country’s export success.
The Federation of German Wholesale and Foreign Trade (BGA) was outraged by the criticism from France, saying in a statement that Germany could not deliberately restrain its exports to give less competitive countries a chance. Instead, the association argued, countries with low levels of exports should consider whether they need to improve their own competitiveness.
Germany’s new European commissioner, Guenther Oettinger, went as far as to recommend that other countries follow the German model. “In Europe, we need more reforms like the ones which have been carried out in Germany,” Oettinger said.”
To fill out the background a bit, this is the same IMF President Christine Lagarde who:
- ….. as French Finance Minister under Sarkozy did absolutely nothing to rein in France’s horrendous over-spending.
- ….. lambasted the Greeks for not paying taxes while she herself pays none at all. That takes a certain chutzpah, which I believe is the appropriate word.
To sum up, the Germans want everyone to be like them while everyone else wants to stay as they are with the Germans paying for it. This is not an easy proposition to sell to the German people. The EU on the other hand wants everyone to be the same within one gigantic super-state, and this is not an easy proposition to sell to ANYone, especially the British. The French keep schtumm on the subject, but I for one can never imagine them giving up their sovereignty. What they really want is for the Germans to stop being unfair by exporting so much and to get their hands on more German money without any accompanying German political control. It is as if in a football international they were asking the Germans to play with no goalkeeper because the rest of their team is too good. If Hollande thinks he can sell that to Merkel, then “Bonne Chance Monsieur.”
Meanwhile, the British look upon all this with a mixture of disbelief and horror, and the following is not designed to impress them much either:
THE EU & OUR MONEY – YOU COULD NOT MAKE IT UP: “The European Union wasted almost £6 billion last year – including £800 million from British taxpayers – on fraudulent, illegal or ineligible spending projects, official auditors have found.”
SIX BILLION??? We are so used to billions being tossed around (They do the same with trillions in the US apparently) that we have lost sight of just what a staggering sum this is. On the basis of a euro coin being 2.33mm thick, if you stacked this up in one-euro coins it would reach nearly FOURTEEN THOUSAND KILOMETRES into the sky. I am not very good at maths so I may have got a zero or two to many, but in any case it is a staggering sum to “lose”.
- The euro was a practical nonsense from the beginning and is doomed. Greece, Portugal et al will never be able to live in the same currency union as GermanyUNLESS ……
- The Germans accept full debt mutualisation, higher inflation and MASSIVE transfers of wealth over decades to the non-performing European countries.
- Merkel has said debt mutualisation will only occur over her dead body (or words to that effect), so it comes down to how far you trust her. She seems to have a stark choice. Unfortunately, whatever the Germans do they will be ferociously blamed for it – by the rest of Europe if they refuse to cough up and by their own people if they do. Is collective German war guilt really so strong that it will lead Germany’s government to shaft its own people? All those guilty for WWI & WWI are DEAD after all.
So far, the Germans have been docile sheep being led to their slaughter. However, I am quite fearful of what might happen here should the German government bow to the demands of the eurozealots and agree to full financial and political union (the two are inseparable – and of course nonsensical).
Don’t miss next week’s episode of “The Eurosoap”!
PS I just checked once again the EU site about its own history, and found this:
“The following visionary leaders inspired the creation of the European Union we live in today. Without their energy and motivation we would not be living in the sphere of peace and stability that we take for granted.” (http://europa.eu/about-eu/eu-history/)
It is of course nauseating and stupid. Peace in Europe was won and maintained by the Allied forces fighting Hitler and later deterring the Russians from aggression. There is no reason whatsoever to give the credit for post WWII peace in Europe to the EU. It is the often reviled Anglo-Saxons and later NATO that Europe principally has to thank, but NATO never figures in any of the credits apportioned by the EU. Ironically, the EU’s lunatic project has brought conflict closer in impoverishing large areas of Europe, which is exactly what happened in the 30s and led to Hitler.
For this reason, the award of the Nobel Peace Prize to the EU was as moronic as it was to Barack Obama, who as far as I can see got it for being black.
It is all a farrago of denial and lies, which is a shame. Many people believe like me passionately in “Europe”. After all, we live here. I am British, married to a German, have three Anglo-Spanish daughters and a tri-lingual son, have worked and lived in three European countries, and my wife and I both speak four European languages fluently. Yet the EU Brusselomafia has turned me completely against the EU. I cannot work with lies, denial and delusions.