The euro is pulverising European democracy. It is destroying democracy not only in Greece but in all other members of the euro zone. It is also destroying people’s hopes for a real democracy at the European level. It has caused a huge rift from north to south and between the crisis-ridden Euro Zone and EU Member States outside the system. It has replaced trust by hyprocrisy. It has stirred up nationalism across the Continent from Scotland to Catalonia to Greece. In Greece, it has stoked hatred and memories of WW2 instead of understanding.
In the 1950s Robert Schuman and the Founding Fathers laid out the road to a democratic, solid Community currency. Its supranational principles are different from either intergovernmentalism or federalism.
Ask a politician today to define ‘supranational’ — and you will see why ignorance or arrogance has got Europe’s money in such a mess. In the 1990s politicians of a later generation chose the pseudo-federalist Delors Plan. It is destroying not only the consensus for a common currency but tearing apart European society.
The European currency was supposed to unite. It was supposed to bring harmony amongst the peoples. It was supposed to bring an era of prosperity and investment in a common future.
It has failed.
Why? It is what Robert Schuman called a ‘counterfeit’ currency! Schuman provided plans and institutions to create a real Community currency but politicians started dismantling them in the 1950s. Ever since they vie in further destructive acts against honest, democratic money.
It is a pathway to pecuniary perdition.
That is why the only alternative to the morass that European leaders have embarked on is to look again at the principles that gave originally Europe its longest period of peace and brought about its greatest prosperity.
The supranational currency system belongs to the people. It would provide full and open democratic input from
- workers and
It would safeguard the democratic rights of various regions so that the rich would not dictate to the poor. It would be based on open government, not closed door meetings of financial ministers.
It would allow governments to adjust their currency to the needs of their individual Member States.
The pseudo-federalist Delors Plan euro does none of these. It is controlled by the secretive, closed door EuroGroup. Who are they? They are national, not European representatives! They are not practically involved in the needs, fears and plans of industry, workers or consumers. They are party political. They come with a party ideology. And as history has shown, they have loose moral and ethics when it comes to doing what ordinary people have to do — balancing the household budget.
They are the people who should be kept at more than an arm’s length from any currency — finance ministers!
The recent events on Greece has cut a swathe of earthquake-like devastation in European democracy.
Firstly, the ‘democratic leaders’ showed themselves completely inadequate to call out corruption in Greece for what it was. Initially they did not insist on anti-corruption measure before serious consideration was given to EU membership. Instead the EU leaders in the Council and also in the Commission dolled out masses of money that only added to the corruption such as in the Bank of Crete scandal.
Neither sides learned lessons. Major Mistakes:
- politicians should not be in charge of money regulation.
- Politicians should not be able in any way to influence a currency, as inflation is hidden taxation;
- politicians should not choose their central bank governor and certainly not in secret;
- Money is public property not the politicians’ plaything. It requires democratic supervision.
Let’s go back no further than the beginning of the month of July 2015. On the first day of the month, five European institutions published a report called: ‘Completing Europe’s Economic and Monetary Union.‘
Called the Five Presidents’ report, it was meant to have all the authority of those who consider themselves Europe’s leading politicians. It was prepared by Commission President Jean-Claude Juncker, President of the so-called Euro Summit, Donald Tusk (also president of the European Council), President Jeroen Dijsselbloem, president of the secretive EuroGroup, Mario Draghi, president of the European Central Bank, and Martin Schulz, president of the European Parliament.
A complete EMU is not an end in itself. It is a means to create a better and fairer life for all citizens, to prepare the Union for future global challenges and to enable each of its members to prosper.
The report is the fruit of ten months’ work of eurocrats of these five institutions. It was launched at the October 2014 EuroSummit. 1 July marks the start of Stage One. What is that about?
Stage 1 (1 July 2015 – 30 June 2017): In this first stage (‘deepening by doing’), the EU institutions and euro area Member States would build on existing instruments…. this entails boosting competitiveness and … and enhancing democratic accountability.
The Commission in reply to my question firstly said that they could not give any details about ‘enhancing democratic accountability‘ as it was a technical matter! When questioned further about a referendum, the Commission said that it did not think referendums would be involved.
Days later, the Greek government announced that it would have a referendum. They urged the Greek populace to vote No. The peculiar motion included out-of-date and unfinished, technical, negotiating positions on euro zone and IMF loans as an annex in English.
Clearly the referendum did not meet Swiss standards of democratic accountability. It was a political operation equivalent to those used in left-wing dictatorships like the DDR or the Soviet Union. In this case it was cleverly crafted to get extreme right wing and centre parties to join in the parody of democracy.
Did the Commission denounce this referendum, because referendums were not part of their yet undisclosed ‘democratic enhancement‘? Did they say that such a farce could not lead to real ‘democratic accountability‘?
Not at all!
The Commission President urged the Greek people to vote Yes! But he spoke ominously about Grexit, the exit of Greece. But from what? the euro? But the politicians’ own treaty, the Treaty of Lisbon, makes it abundantly clear that there is no exit possible from the euro. The Commission as ‘guardian of the treaties‘ repeated that many times recently. It was written in the earlier Maastricht Treaty, specifically to discipline governments to more-or-less balance their budgets and reduce debts. (Several States refused to join the euro as they considered it unworkable.)
Any student of human nature and of history would know that asking politicians not to devalue the currency (through inflation) as a hidden tax is asking the impossible of them. (Soon after the euro was launched, Germany and France were hauled up before the European Court for breaking the ‘Stability and Growth Pact‘.)
What happened in the referendum?
The Greek people voted massively No.
Thus Greek people lost any ability to gain from the extraordinary efforts the IMF, the EU and the European Central Bank had made in bending the rules.
What happened next?
The new Greek government finance minister came to Brussels and accepted all the onerous conditions (and much more besides) that had been rejected by the Greek people in their referendum.
The government then put all these difficult measures of extra taxation and austerity to the Parliament.
What did the Parliament do, seeing that the Greek people had spoken clearly against all of them?
It passed all the onerous measures! In the 300 seat chamber, 229 voted for them and only 64 were against. The puzzled observer might ask: What sort of democracy is that? The same people who had enthusiastically voted for a dubious referendum with the great hope of everyone voting No, were now turncoats against the democratic vote of the people.
What can be more pernicious than the secretive EuroGroup and its secretive political acolytes grinding down any sort of parliamentary and popular democracy into fine dust of public hypocrisy and Brussels-based serfdom?
But that was not the end of it. Far from it. The new vastly increased loans have to be paid for by other European taxpayers. The loans have to be passed in all parliaments of euro Member States. An emergency loan was needed to pay off the IMF. The euro Member States agreed to €7.16bn in short term financial assistance to Greece under the European Financial Stabilisation Mechanism (EFSM).
Was the IMF happy? A few days later, an IMF press release expressed their view: Greek debt was ‘highly unsustainable‘.
The financing need through end-2018 is now estimated at Euro 85 billion and debt is expected to peak at close to 200 percent of GDP in the next two years, provided that there is an early agreement on a program. Greece’s debt can now only be made sustainable through debt relief measures that go far beyond what Europe has been willing to consider so far.
So what do we have of ‘enhanced democratic accountability‘ even before the first month of Stage One ends?
We have the European Commission, which is supposed to be an impartial, guardian of the treaties, saying:
- enhanced democratic accountability’ is a technical matter,
- a referendum is ruled out,
- a referendum is ruled in,
- the Commission President can urge Member States which side to vote on,
- it can impose conditions on the people and government against the clear result of the referendum,
- it can insist that the Greek Parliament vote in favour of these conditions that the referendum has rejected.
The Greek government can
- call for a referendum at short notice, which legally means nothing,
- take the result of the referendum seriously,
- re-negotiate the EU/IMF loan deal to the detriment of the Greek people,
- force the parliament to accept this democratically dubious deal,
- thumb their noses at Greek democracy and the European institutions.
Instead of doing down the IMF, the Greek government was forced to repay the IMF loan. The IMF in return announced that Greece is heading for economic meltdown and the European institutions are going to have to pay through their noses for the foreseeable future.
We have the other Member States of the euro zone, who vote in their parliaments who are ignorant
- whether referendums on the euro are permitted,
- whether the Commission is supposed to speak out urging Europeans vote Yes or No in referendums in general,
- whether euro-loans and imposed conditions of taxation and structural changes under such conditions are legal in EU law,
- and despite this ignorance, their own parliaments are being forced by Brussels to vote according to its timetable,
- and in practice these other ‘democrats’ show they are willing to vote in their parliaments in this state of financial, democratic and legal confusion on the future of the whole EU.
The reality of the counterfeit euro is much worse. There are several other Member States who could end up in a similar dilemma to Greece. Prepare yourselves!David Heilbron Price