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FISCAL AGREEMENT PAVES THE WAY TO FEDERALISM |
| Our illustrious, political elite of the EU project has taken us one step closer to catastrophe - and WWIII. |
On the 9th December 2011, the political leaders of the euro zone, decided without consent of the European citizens, that the Germans and French would now lead the push towards fiscal union, with intergovernmental support of a new fiscal treaty known as the 'fiscal-compact'.
Why was there virtually unanimous support today for an inter-governmental agreement, rather than a treaty change? Because a treaty change would have needed full ratification in each member country and in some of the EU countries that would have meant a referendum - and that is exactly what our political elite do not want - because the people may vote to halt their crusade.
Why did national political leaders give such unqualified support? Firstly, our political elite are all tax-payer funded politicians and bureaucrats and want nothing to stand in the way of their gravy train of perks and privilege. Regarding individual national governments, the reasons are also very clear.
a) Germany wants to have at least fiscal control of Europe so that it can control and guarantee its own market and trading terms. Obviously it is in their interest to support THEIR pact.
b) France still thinks itself as a leading nation of the world and without its alliance with Germany has no chance whatsoever of returning to the world political table. Obviously it is in their interest to support the German pact.
c) Belgium, Netherlands, Luxembourg, Austria and Finland are largely developed, industrialised economies with a fiscal policy and political thinking not so different to the Germans so an agreement of the fiscal conditions laid down by Germany are not so different to how they run things themselves anyway. For them it was purely a choice of the political elite to maintain their gravy train and in their interest to support the German pact.
d) Then there are the PIIGS countries (Portugal, Ireland, Italy, Greece and Spain), plus a few others, that have a liquidity problem relating to cash-flow and their ability to service loan repayments on their government debt - and without a viable plan or potential to get themselves out of their debt crisis. Heavily reliant on promises of EU bailout funding, their local politicians see the subsidies from the EU as a way to escape the crisis without risking their own necks or comfort zones. Obviously it is in their interest to support the German pact.
e) This leaves us with just the countries which want or are waiting for entry to the Euro zone, plus a few more that are about to join the EU - do you really think these governments will rock the boat by saying no, risking the many financial sweeteners that they have been offered by the EU political elite. Obviously it is in their interest to support the German pact.
So, as you can clearly see, for varying reasons of self-interest, it is hardly surprising the fiscal agreement made today was so enthusiastically supported. Greedy self-interest, nationalistic dreams of grandeur, and the inability of the rest to resist financial bribery.
Problem is, not a single European citizen had the opportunity to vote on the matter, not a single European was given the chance to decide on their futures and their children's future. What's more, there was nothing in this agreement to assist the 'troubled' euro zone with a practical plan to address the current crisis. Oh, they say that this inter-governmental agreement is for better fiscal control so that a crisis like this doesn't happen again... but the original Growth and Stability Pact, that was introduced when the euro was agreed in 1992, limited budget deficits to no more than 3% of a country's total economy. And following the recession in the early 2000s, who was it that quickly violated the pact? Germany and France... no penalties as recommended by the GSP, no sanctions, not even bad publicity within the EU, just easy abandonment of the rules that they themselves had set. So what chance of success can we realistically expect from this new agreement that simply rewrites the original rules. Although, from now on, a country's budget and spending plans must be submitted to Brussels in advance for their approval - even though the EU itself has not had its own accounts signed off for well over a decade due to accounting irregularities, missing funds and unsanctioned spending initiatives.
Today's agreement changes nothing, in fact it makes matters worse since the Euro zone has locked themselves together in a single ship with a hole in it, and the water is moving from side to side, inducing a dangerous list - like a boat about to go down. But now, they will take everyone down and those who depend on the safe passage of that ship. In the meantime, rather than fixing the problem through a gradual dissolution of the euro zone, they will bleed their people more and more, arrogantly holding on to an unelected power. In Italy, desperation and a humungous void of practical ideas and solutions to the problem, has driven the political elite to start proposing ridiculous taxation initiatives - from next year, it is likely that all dog owners will be taxed on their dogs, yes their dogs, since our political elite judge that those who can afford a dog must be rich enough to pay more tax. I am disgusted to even think about the consequences of such taxation, of how many pets will be abandoned, drowned, thrown out onto the street. Question is, will the boat sink before civil unrest becomes pandemic across Europe.
The best starting point for a way out of this mess is to reduce taxes, stimulate the circulation of money in the economy to increase confidence and stability, which in turn will generate more trade and spending which will bring in more tax from existing taxation - growth based on increased trade and economic activity rather than on unsecured loans and 'free' credit will increase revenues for all, and reduce the real-term costs of government debt repayments in the coming years... but extreme austerity measures and increased taxation will simply impoverish us all and commit the whole populace of Europe to a recession that will outlast an entire generation.
Frau Merkel, we need a Europe based on free trade and minimal government intervention, nothing else... so please keep your well intentioned mitts out of it, go back to your cultural roots in the old 'East' and start studying the virtues of a true free-market economy. |
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The most important reforms are described with full details of policy and financing in the section [ principles of change | A MANIFESTO FOR CHANGE ]. These reforms are absolutely necessary to initiate positive reform of our political systems. Policy in all areas of state involvement needs urgent attention but must be part of an ongoing process of consensual change through a system of direct democracy and consultative referendum.
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Written by: Michael Livingston Seagull |
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