In the next few months and for years to come perhaps you will be reading a lot of bull shit on this subject.
Where is the European Union going or has gone wrong.
Well you don’t have to wait to know why.
It is the deformed structure of globalisation, which favors the owners of capital and concentrates of wealth that is the culprit.
(Add the demographic tipping point across the Pacific Rim and central Europe, and you have a portrait of worldwide “secular stagnation”.)
The current Greece crises in the Euro Zone is shining a light on a technocrat dictatorship which is beyond democratic control if ever attempted.
The euro zone is least able to respond to the Greek crises because it is a dysfunctional construct.
∑ The European Union with 751 Members and 24 official working languages costs , € 1,756 billion (2014) of which 35% is for staff expenses, mainly salaries for the 6000 officials working in the General Secretariat and in the Political Groups. Moreover, this expenditure covers interpretation costs, the costs of external translation and staff mission expenses.
Another words about 27% (of the 2014 budget) is dedicated to MEPs’ expenses, including salaries, costs for travel, offices and the pay of personal assistants.
Expenditure on Parliament’s buildings accounts for 11% (2014)
Information policy and administrative expenditure such as IT and telecommunications account for 21% (2014)
Political Group activities account for a further 6% ( 2014) ∑
What’s wrong then?
More to the point what can be done?
The first is the recognition of sharing a common history, which usually means sharing episodes of violence, pain, suffering, and, yes, achievement.
Next there is no meaningful representative democracy without taxation.
Citizens and voters pay attention when they are taxed.
A European tax that replaces government approved transfers of funds could do wonders for getting Europeans interested in Europe.
(The willingness to transfer significant spending and taxing powers to European institutions is very limited.)
The European project needs anchor figures chosen directly by Europeans.
A presidential figure elected through the rule “one European, one vote” would be a good start. A figure to love and to hate, that could engage Europeans with the legitimacy of the vote and (why not?) have an important say in the dying and the paying issues that can promote a new citizenship and a new polity.
We all know that the founding aspiration of the European Union was born out of War and that is where it is going if it does not represent the people of Europe not the Free market with its proxy behind the doors trade agreements.
And we all know that once money enters any equation aspirations go out the window. What follows is the erosion of the common good, democracy and in comes – I am all right Jack.
The regulation of money creation is, essentially, a undemocratic economic policy and there is no better example of this than the current Greek crises.
Indeed the greatest risk for the survival of the Euro zone today is the risk emanating from social and political upheavals in countries that are forced into a deflationary spiral.
The euro zone has let it happen in Greece.
Europe’s authorities have so mismanaged monetary and fiscal strategy that the whole currency bloc has tipped into deflation.
The ideas of Europeanism, federalism, and even “post-material” politics appeal, albeit in different ways, to new possibilities for political, cultural, and
social cohesion will force Europe to think deeper about its first motivation for establishing a common economic market: attaining a long-lasting peace in Europe.
The means to create and pass on a similar European narrative to a wide mass of individuals is now open to question.
We ought to know by now, economic fluctuations hit different jurisdictions differently. If these economic fluctuations are relatively synchronous or resources sufficiently mobile, monetary policy is an appropriate instrument, and the area to which it is applied is a so-called “optimal currency area”.
The problem is that we are still, evidently, in the process of making Europe, but may be well advised to start making Europeans at the same time.
It can be sum up in one word. Diversity.
Often seen not as a liability it is the core fact that allows for change and progress. The “unity in diversity” motto is but a starting point, which urgently needs new incarnations.
http://business.financ€35bn to help the economy” ialpost.com/news/economy/drachma-diplomacy-what-would-life-after-the-eu-look-like-for-greece
The question is:
Is Tsipras really looking for a deal with Europe?
The Greek government now accounts for about 60% of the country’s entire GDP. Leaving the euro zone could cost the Greek economy up to 36% of its GDP over the next few years.
If Greece switches currency, any euros left in Greek bank accounts would depreciate by 50% to 60% in a matter of days.
The recent decision by the ECB to act a lender of last resort is a major regime change for the Euro zone. It is not sufficient, however, to guarantee the survival of the monetary union.
Perhaps Debt pooling would ties the hands of the member countries of the Euro zone and shows that they are serious in their intentions to stick together.
Where did all the Quantitative Easing go ? Not to Greece – 60 billion a month till Sep 2016.
When the one size of the single monetary policy does not fit all, supplementary, possibly coordinated, national fiscal policies should also be activated – where national fiscal policies are tightly constrained and loosely coordinated, especially so in the countries where the QE impact will be smaller.
The result may eventually be dim.
It is the case with any monetary policy instrument in a monetary union, QE in the EZ is fraught with the heterogeneity problem of the recipients of monetary policy. The institutional strictures and pressures under which the ECB operates will make the task harder. Of course, easier monetary conditions will help the EZ economies.
The endogenous dynamics of booms and busts that are endemic in capitalism continued to work at the national level in the Euro zone and that the monetary union in no way disciplined these into a union-wide dynamics.
The monetary union probably exacerbated these national booms and busts.
The existing stabilizers that existed at the national level prior to the start of the union were stripped away from the member-states without being transposed at the monetary union level. This left the member states “naked” and fragile, unable to deal with the coming national disturbances.
Even if Greece signs up to the package of tax and spending reforms demanded the most likely outcome – is that Greece’s debt would still be 118% of GDP in 2030.