Tag Archives: EU

‘Brexit’ . . . The Third Option

BREXIT photo

As the 24th June recedes into memory there is no doubt the establishment machinery has been working overtime to undermine the voice of the British majority decision to exit the EU, even suggesting many are having a change of heart.

The stock markets were beautifully manipulated to make small fortunes for those who already have large fortunes as they bounced back after the chaos of the vote. The IMF  reckon Britain will outstrip Germany, France and Italy’s growth forecasts and our own Bank of England report our economy has not slowed since the Brexit vote . . . So much for the end of the world!

Whilst the ‘presstitutes’ now focus on the triggering of Article 50, our new government is preparing for the supposed two years of negotiations to enable our extraction from Brussels influence.

The question nobody seems to be asking, in all of this hype and scaremongering, is the very real possibility that those negotiations won’t actually go the distance, because the EU has collapsed.

As time passes the problems for Brussels seem to be escalating, as the technocrats lurch from one regulated disaster to the next. With the benefit of hindsight, we should have read the warning signs of over regulation in the 70’s, with the famous beef and butter ‘mountains’ and wine ‘lakes’.

Then we saw the introduction of the disastrous single currency, designed to bring about financial control over the EU. Time has now shown that it is beyond possibility to try and manage the individual financial environments of many different countries in such a manner.

This one piece of mismanagement has led to building a toxic financial environment that is no longer sustainable without blatant subterfuge. Negative interest rates are not only killing the traditional business of banks but also crucifying pensions investment and the future incomes of hundreds of millions who have paid in with utmost good faith.

Moving from the financial to the political, we now have the political pantomime that has seen France, Germany and Italy declare a summit in Italy next month following the aftermath of the UK exit. We have G20 and G7, is this E3? I can only see it as another very expensive taxpayer funded ‘bun fight’, as I question the credibility that will give substance to these three getting together?

Let’s start with Germany, where Merkel is just about hanging on to power, with her country overrun with refugees she has invited in without reference to the other members and who are frightening off tourists as fast as the immigrants appear.

Her posturing and dictates also give no clue to the fact that her country is about to financially implode. Hers is the first Eurozone country to issue negative interest debt, something the ECB will not (currently) redeem in event of problems.

For over a year now the financial pundits have been saying the country’s largest bank by far, Deutsche Bank, is in serious trouble. Its share price has dropped 48% since last July, motivating finance minister Wolfgang Schauble to declare in February he has “no concerns about Deutsche Bank”, something finance ministers don’t say about ‘healthy’ banks!

The bank has been selling more of its shares and issuing ‘contingent convertible bonds’ to raise desperately needed capital, all of which have gone to further depressing it share price and credibility!

Such is global concern that Deutsche Bank will become the next Lehman Brothers that the IMF, no less, have publicly branded it the riskiest globally significant bank, at a time when its US businesses also failed a Federal Reserve stress test. If/when this bank collapses, the reverberations will make 2008 look like a walk in the park.

Then we have Italy, where the IMF have also declared the country’s banks, who have seen their share price plummet by more than 50% this year alone, pose a particular threat to the economic outlook. “Unless asset quality and profitability problems are addressed in a timely manner, lingering problems of weaker banks can eventually weigh on the rest of the system” came their warning.

Monte Dei Paschi is Italy’s third largest publicly traded bank and its particular distinction is that no bank in Europe has fallen so low so fast without completely crashing. Two years ago their shares were worth between €5 and €9 and today they are worth €0.33. What keeps it on life support is constant taxpayer bailouts, something a Merkel bullied Brussels has now pulled the carpet on.

Here lies the embarrassment for premier Renzi before his summit with France and Germany, rumour has it he is contemplating going head to head with Brussels and enacting a unilateral sovereign rescue of the Italian banking system.

How will he face Merkel, who insisted upon ‘bail ins’ over ‘bail outs’ and has gone on record as saying “We wrote the rules for the credit system, we cannot change them every two years”. If Merkel gives in it will make a mockery of her ‘bail in’ rules before they have been properly used, to say nothing of the political fallout if, once again, there is a raid upon taxpayer’s money to save a bankrupt financial system.

Whether she maintains her position or waivers, neither is an endorsement of her direction of EU policy, or the credibility of Brussels regulations.

What cannot also be overlooked is that Italy is the EU’s third largest economy, with €2.23 trillion of public debt, €400 billion of which is stagnating in Italian banks as bad loans, making them not only ‘too big to fail’ but also ‘too big to save’!

Finally, we have France’s contribution to the ‘toxic trio’ and their pompous little president, who is now traveling around the EU to secure unity in the face of these pending financial disasters, the Greek fiasco and Brexit and being publicly booed for his troubles. (Or perhaps it’s because of the $14,500 of taxpayer money he spends each month on haircuts!  Where is his credibility, when his popularity rating at home is now reported at below 10%?

As Philippe Le Corre noted in the Financial Times, opinion polls show that 61% of French people “hold unfavourable views of the EU”. Two-thirds feel that ”the EU has failed them economically”. By contrast to the UK, it’s the young who have been among the hardest hit, with massively high unemployment. “It is likely that they would vote for “Frexit” in a referendum”, says Le Corre.

This seems to be lost on Martin Schultz, President of the EU Parliament, who stated quite clearly: “It is not the EU philosophy that the crowd can decide its fate”. (So what is the point of the elected members of this parliament, or indeed this parliament?!!!) And this pearl of wisdom comes only weeks after the people of one of the EU’s largest contributors demanded a return of democracy following their Referendum on membership on 23rd June.

The European Commission’s attempts to drive through the trade deal with Canada (CETA) is pouring more petrol on the glowing embers of discontent, as it is now close to collapse after a German political party sued Brussels over its implementation. “it reveals once more the cavernous differences opening up between different member states which have effectively rendered the European project unworkable”, according to one recent report.

The only logic appears to be that this undemocratic move by Brussels creates a precedent for the equally undemocratic TTIP trade deal with the US, which is running in the face of huge public protest.

It will only take the effects of one of these trade deals, or the collapse of a bank, on top of the mounting problems of immigration, to trigger revolt in an already unstable union, which it is not that far off if Brussels pursues its present political stance.

Two years of exit negotiations . . . we shall see.

Until the next time.

 

Thinking from his Book: Global Magna Carta. Returning Power to the 99% . . . If They Want It! By J T Coombes

Rescue Europe from Brussels

We’ve got the American elections on 8th November this year, the French presidential elections in April and May next year, followed by the German federal elections between August and October. The UK elections aren’t until 2020, if there isn’t a revolt beforehand!

Talking of revolt, can you imagine what the reactions would be if the electorate at each of these events were told by their political leaders: “OK you can vote for me and stay here OR you can vote against me and get out.”

The sense of outrage would be overwhelming and rightly so. Why the hell should we have to leave the country because we don’t like the way they are running things? After all it is us who are paying for it . . . including their salaries and considerable expenses. For this commitment from us we are singularly entitled to a say in how things are run and what sort of future we are looking for.

When accountability is ignored we have demonstrable proof of abuse of power, brought about by a whittling down of the democratic process.

We acknowledge this human fallibility with power in some parts of the world. In countries like the US and France, there is a constitutional limitation of just two terms on how long any one president can serve, no matter how popular or unpopular that person may be.  This statute of limitations is a reassurance against the abuse of power.

In the UK, who doesn’t have this limitation, we have seen a ‘natural’ break, where the incumbent just runs out of credibility because of abuse of power – as was the case with Margaret Thatcher (three terms), Tony Blair (2 ½ terms) and Cameron (who knows he won’t make a third term).

With only a very few exceptions, political parties/leaders seem to have an ‘inbuilt lifespan’ over which they can exercise power before the people grow weary of them and demand change. Perhaps it should be legislated for, although abuse of power is now rampant whatever the supposed safeguards.

So, given that brief resume of Democracy, why is it the British people are taking part in an ‘election’, to ratify the power of the officials running the EU, under the guise of a ‘Referendum’?

Referendum: Submission of an issue of public importance to the direct vote of the electorate. (The Free Dictionary by Farlex)

‘Vote’ is the operative word here and signifies support, or not, for those running the establishment, however that is structured. We support a party’s manifesto, in an election, with our vote and that is now what is being asked with this Referendum . . . but does it have the same credibility?!

Consider the facts.

  1. An election ‘Referendum’ has been called because there is unrest, now evidenced across Europe and a vote of confidence is therefore sought by those running things (Brussels).
  2. There are no alternative parties to vote for, so the only option is Brussels.
  3. There is no limitation on the length of service for the body that actually runs it all – The European Commission – so an ‘In’ vote has them running things for eternity.
  4. The members of this council form no part of the democratic process by which this election ’Referendum’ has been called, because they have not been elected by the very people now being asked to give them a vote of confidence. Nor do they have a manifesto which gives them some credibility . . . they are essentially seeking unconditional support.

Is it me or is this ‘Democracy for beginners’?

How can we possibly give a vote of confidence to a body, who won’t tell us what they are up to (TTIP), we had no hand in putting into power and cannot throw out either? That is why we are being forced to vote on a ‘Referendum’ and not in an Election . . . because there are no alternatives to Brussels . . . We have no choice!

Brussels must be having a good laugh, because a lot of people are taking this all very seriously. To be fair, it is incredibly serious in highlighting just how distorted our Democracy has become in the running of the European Union.

Political distortions seem to be Brussels forte, if we look at its track record, which has been one of constant regulation. Indeed, it latest efforts beggar belief when countries like Spain and Italy are about to be fined for not getting their GDP in order. Forget that they are struggling with the distorted financial (ECB) policies of Brussels in the first place.

Greece (the biggest distortion of the lot), is being regulated out of existence through debt that should have kept it from membership in the first place.

Then we have six countries who were recently hauled over the coals for not implementing Brussels induced legislation, that forced ‘bail ins’ of the banks (by their customers) to protect the banks when the next financial collapse occurs.

Here’s the distortion. With regulation also their forte, why has there been a deafening silence from Brussels on responsible regulation of those same banks to minimise a collapse from happening again? Perhaps they are now setting up the patsy’s instruments to pay for it all, because they know it will happen again.

Brussels regimentation of its 28 member countries, by endless biased rules and bureaucratic gobbledegook, seems the best it can come up with to ‘manage’ this European Union but is not working. In over 60 years it has built little that is having a positive effect upon unification.

Quite the reverse. This regimentation has now become so acute that Europe is breaking down because of gross mismanagement and a dwindling democracy, as people become demotivated through lack of involvement – whilst still having to pay for it all.

Europe could be a wondrous place, unified in a common sense of purpose, with a properly functioning democracy. Instead it is a political and corporate playing field, where the only injuries are experienced by the spectators, the 99%. This includes long term youth unemployment and immigration, whilst the rich and powerful play havoc with the essential myriad of values that hold Society in place to enrich their own pockets.

Europe needs rescuing from the clutches of the Neoliberal machinery that is currently Brussels. ‘Remaining’ to sort out the mess won’t work because Brussels (boosted by ‘Remain’) won’t give up its power, aided and abetted by the financiers who exert overall control, as they have done since inauguration.

Breaking that power is the only solution and if Britain doesn’t rescue Europe on 23rd June another country will, as the current model is unsustainable.

Until the next time

 

Thinking from his Book: Global Magna Carta. Returning Power to the 99% . . . If They Want It! By J T Coombes