Filed under: Capitalism, Economy, Europe, Socialism | Tags: The European Monetary Union, The European Parliament, Will Europe Affedt Us?
The Euro crisis continues. It seems as if it has been going on forever. Daniel Hannan, MEP for South East England, though a member of the European Parliament, is definitely not a fan of the European Union. He said today:
Shall I tell you the truly terrifying thing about the EU? It’s not the absence of democracy in Brussels, or the ease with which Eurocrats swat aside referendum results. It’s the way in which the internal democracy of the member states is subverted in order to sustain the requirements of membership. …
Euro-enthusiasts in Brussels and in Athens are ready to bring down an elected government rather than allow a referendum. Yet the funny thing is that Papandreou is a Euro-enthusiast. He fervently wants to remain in the euro, and had been planning to campaign for a Yes vote. His sin, in the eyes of Brussels, was not to hold the wrong opinions, but to be too keen on democracy. Leninists had a term for people who, while they might be committed Bolsheviks, none the less behaved in a way which endangered the movement. They were called “objectively counter-revolutionary”. Poor Papandreou finds himself in this category.
It is probable that Greek voters will reject the European Union deal, unless Germany, France and the others decide to come up with an alternative offer. Nile Gardiner explains from the British (Tory) point of view:
The Greeks have largely dug their own hole of despair after years of excessive public spending and borrowing (as well as over-regulation of their economy). Several other Euro countries are in the same boat, including Portugal, Spain and even Italy, the EU’s third-largest economy.
But it is only right that the Greek people have the final say in deciding their own future; in any case, no amount of German-funded bailouts will rescue Greece from financial collapse. In fact, the promise to hold a referendum is practically the only major decision the Greek government has got right in the past decade. It will no doubt spark calls for popular votes on the EU across
From its inception, the 17-country single European currency has been an inherently political project, designed to artificially unite a diverse group of nations stretching across southern, central and northern Europe. It has in practice served to artificially push down interest rates in traditionally high-rate countries, leading to excessive borrowing and the current debt crisis.
The European Union was formed to unite the many countries in the European Continent who had been warring for centuries, and borders shifting and changing. After the devastation of World War II they wanted to prevent any more wars. But they did it with a fundamentally undemocratic approach, foisting an untested economic experiment on their own people without popular consent. No Eurozone country has held any kind of popular vote on its own membership in the monetary union. Layer on top of that the European compulsion to spend vast quantities of money on alternate energy schemes, carbon trading, wind farms and solar arrays such as the ones that have so damaged the Spanish economy.
Socialist economic planning and an unelected and unaccountable parliament have resulted in economic decline and an increasingly disillusioned electorate. Treasury Secretary Geithner said that we will be very helpful as a major funding source for the International Monetary Fund, but has offered no specifics. So we are left to watch and hope, short of information, and with little understanding of how this all works. We’re left hoping that events across the water won’t come back to bite us. President Obama did advise the Europeans to do a stimulus like he did, but, fortunately, they quickly rejected that advice, and not too politely at that.
Bret Stephens wrote back in September that the hard fact on which postwar Europe was founded was military necessity: “crisply summed up by Lord Ismay’s famous line that NATO’s mission was ‘To keep the Russians out, the Americans in, and the Germans down.”
In 1965, government spending as a percentage of GDP averaged 28% in Western Europe. Today it hovers just under 50%. In 1965, the fertility rate in Germany was a healthy 2.5 children per mother. Today it is a catastrophic 1.35. During the postwar years, annual GDP growth in Europe averaged 5.5%. After 1973, it rarely exceeded 2.3%. In 1973, Europeans worked 102 hours for every 100 worked by an American. By 2004 they worked just 82 hours for every 100 American ones. …
There was the convenient fiction that Europe didn’t need robust military capabilities when it could exert global influence through diplomacy and soft power. There was the convenient fiction that Europeans shared identical values and could thus be subject to uniform regulations governing crime and punishment. There was the convenient fiction that Continentals weren’t lagging in productivity but were simply making an enlightened choice of leisure over labor.
And there was, finally, the whopping fiction that Europe had its own “model,” distinct and superior to the American one, that immunized it from broader international currents: globalization, Islamism, demography. Europeans love their holidays and thought they were entitled to a long holiday from history as well.
Stephens says that America will survive this because America is a state. But the European project will implode. Countries want to retain their own fiscal independence — the core essential of democratic sovereignty. Not promising, not pretty.