Tag Archives: European Union

EU Ambassador to the US: Euro Crisis to Be Exploited to Further Fiscal and Political Integration

open quote The European Union’s ambassador to the United States, Mr. Joao Vale de Almeida, addressed a large and polite audience today at the University of Iowa’s School of Law. . . .

Today Europe is in the midst of a very serious economic crisis which threatens the future of the EU itself. What changed to bring about this potentially catastrophic development? Well, Mr. Vale de Almeida told us in unequivocal words–the desire of a European elite for political integration, using the euro crisis as the vehicle.

Mr. Vale de Almeida stated that economic integration had ensured that the errors of one nation could infect all others in the bloc. But this was not possible until 17 of those nations used a common currency, the euro. A nation that uses its own, national currency cannot cause inflation in its trading partners; it can cause inflation only in its own monopolized currency zone. But now all 17 nations can transmit inflation to all other countries in the euro zone via their roundabout ability to monetize their national debts via euro printing. All 27 nations in the EU, even those such as the UK which are not using the euro, are being coerced into bailing out those nations who have used euro printing to accumulate unsustainable sovereign debt. All Europe is at odds over this proposal.

Mr. Vale de Almeida informed his audience that the EU is moving further into political unification, having recently formed the External Action Service, a kind of super foreign ministry that purports to speak for all of Europe. He claims that the EU nations already hold common foreign policy positions on 90% of the issues. No doubt this is true. But it is the other 10% that causes all the trouble. close quote (Read more)

How Goldman Sachs helped mask Greece’s debt

open quote Eurozone finance ministers are holding talks in Brussels aimed at securing a second vital bailout for Greece. France’s Finance Minister Francois Baroin has said all the elements are in place for a deal.

Nick Dunbar, author of The Devil’s Derivatives, revealed how the country turned to investment bank Goldman Sachs for help getting around the deficit rules. close quote

(Story & VIDEO here)

Soros the Keynsian

open quote Markets do not correct their own excesses. Either there is too much demand or too little. This is what the economist John Maynard Keynes explained to the world, except that he is not listened to by some people in Germany. But Keynes explained it very well — when there is a deficiency of demand, you have to use public policy to stimulate the economy. close quote

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In the rest of the interview, I think he says that Germany should bailout the Euro Zone, but as is usually the case with Keynsians, it isn’t completely clear.

Not just the Euro putting pressure on EU unity. Also, Immigration.

open quote French president Nicolas Sarkozy yesterday threatened to wreck the European free travel zone unless there is a new pact to cut down on illegal immigration.

His warning in an election campaign speech threw a question mark over the future of the Schengen zone, regarded by Brussels as the EU’s second most important achievement after the single currency.

The 25 Schengen countries allow travellers to pass each other’s borders without checks or the need for visas.

But a wave of immigrants who began arriving in Italy and southern Europe following the Arab Spring last year has put the 27-year-old zone under unprecedented pressure.
close quote (Read more)

Why Iceland Should Be in the News But Is Not

open quote Elections were brought forward to April 2009, resulting in a left-wing coalition which condemned the neoliberal economic system, but immediately gave in to its demands that Iceland pay off a total of three and a half million Euros. This required each Icelandic citizen to pay 100 Euros a month (or about $130) for fifteen years, at 5.5% interest, to pay off a debt incurred by private parties vis a vis other private parties. It was the straw that broke the reindeer’s back.

What happened next was extraordinary. The belief that citizens had to pay for the mistakes of a financial monopoly, that an entire nation must be taxed to pay off private debts was shattered, transforming the relationship between citizens and their political institutions and eventually driving Iceland’s leaders to the side of their constituents. The Head of State, Olafur Ragnar Grimsson, refused to ratify the law that would have made Iceland’s citizens responsible for its bankers’ debts, and accepted calls for a referendum.

Of course the international community only increased the pressure on Iceland. Great Britain and Holland threatened dire reprisals that would isolate the country. As Icelanders went to vote, foreign bankers threatened to block any aid from the IMF. The British government threatened to freeze Icelander savings and checking accounts. As Grimsson said: “We were told that if we refused the international community’s conditions, we would become the Cuba of the North. But if we had accepted, we would have become the Haiti of the North.” (How many times have I written that when Cubans see the dire state of their neighbor, Haiti, they count themselves lucky.)

In the March 2010 referendum, 93% voted against repayment of the debt. The IMF immediately froze its loan. But the revolution (though not televised in the United States), would not be intimidated. With the support of a furious citizenry, the government launched civil and penal investigations into those responsible for the financial crisis. Interpol put out an international arrest warrant for the ex-president of Kaupthing, Sigurdur Einarsson, as the other bankers implicated in the crash fled the country. close quote (Read more)

EU overruling British law – forbidding British deportation of rapists, jihadists

Explosions damage Italy tax agency

open quote Three explosive devices blew up outside the Naples offices of Equitalia, a state agency that collects overdue taxes and fines, breaking windows but injuring no one on Monday night, a police official told Reuters.

Police said no group had claimed responsibility for the attack on the building on Corso Meridionale near Naples central rail station.

Equitalia, whose offices have been attacked before, is deeply unpopular among many Italians who accuse it of using strongarm tactics to collect taxes. close quote (Read more)

Merkel faces rebellion, goes begging

From a recent Open Europe summary:

open quote Tensions rise over second Greek bailout as German government faces rebellion

Bild reports that around 40 MPs from the CDU, CSU and FDP coalition could rebel against the second Greek bailout, meaning that the government may only win a narrow majority.

German Chancellor Angela Merkel leaves today on a state visit to China, where among others, she will again try to solicit Chinese investment in the eurozone’s bailout fund, the EFSF, reports FT Deutschland.
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Hungary far right demands exit from EU, burns flag at rally

open quote Thousands protested against the EU Saturday at a rally of the far-right Jobbik party, calling for Hungary’s exit from the bloc and adding pressure on the government which is seeking a funding deal with the EU and IMF to avert insolvency.

Two MPs of Jobbik, the second biggest opposition party in Hungarian parliament, set an European Union flag on fire at the protest in front of the European Commission offices in Budapest.

“This week the EU declared war on Hungary in a very harsh and open way,” Csanad Szegedi, a Jobbik member of European Parliament told the crowd of around 2,000 demonstrators. close quote (Read more)

True Finn Party Against Euro-Zone Bailout

open quote When I had the honor of leading the True Finn Party to electoral victory in April, we made a solemn promise to oppose the bailouts of euro-zone member states. Europe is suffering from the economic gangrene of insolvency—both public and private. Unless we amputate that which cannot be saved, we risk poisoning the whole body.

To understand the real nature and purpose of the bailouts, we first have to understand who really benefits from them.

At the risk of being accused of populism, we’ll begin with the obvious: It is not the little guy who benefits. He is being milked and lied to in order to keep the insolvent system running. He is paid less and taxed more to provide the money needed to keep this Ponzi scheme going. Meanwhile, a symbiosis has developed between politicians and banks: Our political leaders borrow ever more money to pay off the banks, which return the favor by lending ever more money back to our governments.

In a true market economy, bad choices get penalized. Instead of accepting losses on unsound investments—which would have led to the probable collapse of some banks—it was decided to transfer the losses to taxpayers via loans, guarantees and opaque constructs such as the European Financial Stability Fund.

The money did not go to help indebted economies. It flowed through the European Central Bank and recipient states to the coffers of big banks and investment funds.

Further contrary to the official wisdom, the recipient states did not want such “help,” not this way. The natural option for them was to admit insolvency and let failed private lenders, wherever they were based, eat their losses.

That was not to be. Ireland was forced to take the money. The same happened to Portugal.

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Why did the Brussels-Frankfurt extortion racket force these countries to accept the money along with “recovery” plans that would inevitably fail? Because they needed to please the tax-guzzling banks, which might otherwise refuse to turn up at the next Spanish, Belgian, Italian or even French bond auction.

Unfortunately for this financial and political cartel, their plan isn’t working. Already under this scheme, Greece, Ireland and Portugal are ruined. They will never be able to save and grow fast enough to pay back the debts with which Brussels has saddled them in the name of saving them.

Setting up the European Stability Mechanism is no solution. It would institutionalize the system of wealth transfers from private citizens to compromised politicians and failed bankers, creating a huge moral hazard and destroying what remains of Europe’s competitive banking landscape.

Fortunately, it is not too late to stop the rot. . . . close quote (Read more)

Iran Set to Turn Off Oil Supply to Europe

open quote It’s a move which has tit-for-tat written all over it, but one which could nonetheless have a serious impact: The Iranian government wants to present a bill to parliament this weekend calling for an immediate halt to oil deliveries to Europe. The move, with most reports citing the Iranian news agency Mehr, has come about in response to the EU agreement to impose sanctions against Iran, which were announced earlier this week.

The sanctions banned any new contracts for buying oil from Iran, but allowed existing deals to continue until July in order to give countries time to find other sources. But that process is now at risk after the latest move from Tehran, a step the Iranian government had already threatened.

“If this bill is passed, the government will be forced to stop selling oil to Europe before the actual implementation of their sanctions,” said Emad Hosseini, spokesman for the Iranian parliament’s energy commission, reportedly said. The bill is set to become law on Sunday.

The EU sanctions allow for oil deliveries from Iran until July 1. Any pre-empting of this timescale by Tehran could prove problematic for countries like Italy, Greece and Spain, who would need to urgently find new suppliers. close quote (Read more)

The European Union is now blocking importation of lethal injection technology into the United States

open quote The EU is now blocking importation of technology into the United States that we cannot be trusted to use properly. As widely reported yesterday, the EU is cutting off our supply to the drugs we use for lethal injections, some of which we no longer have the capacity to manufacture domestically. . . .

Responsible medical professionals have long since distanced themselves from the death penalty. Just as the American Psychological Association bans its member psychologists from participating in military torture techniques, the American Board of Anesthesiologists will decertify an anesthesiologist who helps with lethal injection. Unfortunately there is no similarly responsible organization to keep our statesmen and the legal profession at bay from continuing to oil the machinery of death in this country. close quote (Read more)

Vincent Browne v The ECB

Small countries, like Ireland have the ability to say “why send our money to them, they have nothing to do with Ireland.”

Big countries like the US do not.

France and Germany push to eliminate competition from low-tax countries

From today’s Open Europe news summary (my emphasis in italicized bold lettering):

France and Germany push for greater “tax coordination” in the EU and swifter negotiations on FTT
France and Germany yesterday unveiled a set of joint proposals which they say would boost growth in the EU. The proposals will be submitted to European leaders at their meeting on 30 January. The document reads, “European institutions and member states should accelerate the process of tax coordination…In particular, the negotiation of the European Commission proposals on Energy Tax Directive, Common Consolidated Corporate Tax Base and Common System of Financial Transaction Tax should be accelerated.”

In an interview with Bild, Hungarian Prime Minister Viktor OrbÃ¡n argues, “We support the initiative of Chancellor Angela Merkel on the fiscal union. But we strictly reject a Europe-wide harmonised tax system. Hungary’s low tax rate is for us a competitive advantage that we cannot do without.” Handelsblatt notes that the Czech Republic has voiced opposition to the introduction of an EU-wide FTT.

On Germany’s Euro Dilemma

I would say “the guarantor of peace” is not democracy but commerce, the freer the better. Nevertheless, this is well put, and I’m glad at least some Europeans are talking about it.

open quote In an interview with the German Bundestag’s weekly paper, Das Parliament, former German President and former Chairman of Germany’s Constitutional Court, Roman Herzog, warned that the eurozone crisis could be a threat to democracy. He also argued that “the EU was not conceived as a super state. It will not work. We live in a world which depends on flexibility and the individual initiatives of states. Even today the EU is hamstrung by the masses of rules produced by Brussels…First of all around half of the 70,000 pages of EU regulations ought to be repealed.”

Separately, writing in yesterday’s Handelsblatt, former president of the Federation of German Industries, Professor Hans-Olaf Henkel, describes Chancellor Angela Merkel’s claim that “if the euro fails Europe fails” as a “fallacy”, arguing that “the guarantor of peace is democracy and not the euro…The increasingly undemocratic attempts at crisis management – the constant meddling of German politicians in the affairs of other countries, the limitation of the budgetary control of member states’ parliaments by un-democratically elected centralist supervisors – are leading to a dangerous erosion of democracy.” close quote

(From a recent Open Europe sumary.)