Europe & EU 2011

Jeremy Kinsman: Can Europe be saved? (Nov. 28)
It has been a tough fortnight for Europe’s struggling economies. In a double whammy, big institutional investors jacked up the price on government bonds, even for mighty Germany, while European banks faced a credit crunch that was stalling their ability to ease the debt fight.
… European Union leaders are in Washington to brief Barack Obama and his cabinet on the so-called euro crisis. But as former Canadian ambassador Jeremy Kinsman observes, there may be a bigger underlying concern.
2021: The New Europe
Niall Ferguson peers into Europe’s future and sees Greek gardeners, German sunbathers—and a new fiscal union. Welcome to the other United States
(WSJ) Welcome to Europe, 2021. Ten years have elapsed since the great crisis of 2010-11, which claimed the scalps of no fewer than 10 governments, including Spain and France. Some things have stayed the same, but a lot has changed.
The euro is still circulating, though banknotes are now seldom seen. (Indeed, the ease of electronic payments now makes some people wonder why creating a single European currency ever seemed worth the effort.) But Brussels has been abandoned as Europe’s political headquarters. Vienna has been a great success.
Niall Ferguson on Europe and the collapse of the West
(Globe & Mail interview) On the cover of historian Niall Ferguson’s new book, Civilization: The West and the Rest, is a photograph of a gold-filigreed, antique French mantel clock lying on its side. Mr. Ferguson’s implication is clear: Like France’s 18th-century monarchy, societies don’t fall decorously. They topple – not without warning, perhaps, but nevertheless with astonishing speed and often messy consequences. And that, as he told The Globe and Mail’s Michael Posner, constitutes his book’s Code Red alert: Unless Western civilization contends with the myriad risks it now faces, it, too, may collapse – and sooner than one might think.
The Hungarian spectrum

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Euro will lose a country in 2012 as breakup begins, CEBR says
(Bloomberg via National Post) At least one country will pull out of the euro area this year as the breakup of the single currency begins, according to the Centre for Economics and Business Research.
“It now looks as though 2012 will be the year when the euro starts to break up,” the London-based CEBR said in a statement today. “It is not a done deal yet — we are only forecasting a 60 percent probability — but our forecast is that by the end of the year at least one country (and probably more) will leave.”
Germany and Europe Expect a Tough 2012
(Spiegel) The year 2011 was a bad one for Europe. But 2012, Angela Merkel believes, could even be worse — for her country at least. Both the German chancellor and Finance Minister Wolfgang Schäuble believe the euro crisis will finally make itself felt in Germany. The outlook isn’t any rosier elsewhere on the Continent.
21 December
What really caused the eurozone crisis? – “Eurozone crisis for Dummies” with excellent graphics
World leaders probably spent more time worrying about the eurozone crisis than anything else in 2011.
(BBC) And that was in the year that featured the Arab Spring, the Japanese tsunami and the death of Osama Bin Laden. What’s more, 2012 looks set to be not much different. But as eurozone governments hammer out new rules to limit their borrowing, are they missing the point of the crisis?
EU demands £25bn lifeline from the UK
(The Telegraph UK) David Cameron will come under pressure today to resist demands to contribute more than £25 billion to a new eurozone bail-out. The Prime Minister has repeatedly promised not to provide any extra funding for the IMF for the specific purpose of saving the euro and Britain is already liable for £12 billion of loans and guarantees to Ireland, Greece and Portugal. Reuters comments “The euro zone debt crisis may be as much about the heart as it is about the head — like a jilted lover, markets are just finding it hard to trust again.”
16 December
Fiction of the EU Summit’s Accepted ‘Facts’
(WSJ) Last week’s last-ditch summit to save the euro apparently didn’t. So, back to the drawing board, and yet more “make-or-break” meetings dragging on into the early hours appear to await us.
All such meetings are surrounded by hyperbole, for which my own trade shares its responsibility, disingenuousness and even dishonesty. But last week’s was an object lesson in how in subsequent discussions of things that aren’t true, or are half true, are accepted as facts. Here are a few.
Reuven Brenner: Europe Has A Clear Choice: Either Leadership Or Bankruptcy
(Forbes) … The financing of profligate, unaccountable governments, sanctioned by rating agencies and Basel as being “riskless,” brought us to the present situation. The solution for the Eurozone required a drastic change in domestic policies cajoled by the European Community. After all, the EC knew all along about the extensive black, grey markets, and the intricate patronage. Solutions were known too: simplified taxes, simplified regulations, more accountable governments.
Note that these solutions have very little to do with financial markets. They are a matter of political leadership. The political and financial institutions of China, Italy, Greece, etc. shaped intricate institutions and habits and will not be altered because some economist or politician will disapprove of it or devise some new technical models. Changing these is a matter of political leadership.
Unfortunately, such leadership is today nowhere in sight. If it does not emerge, bankruptcy, a distant second best, will bring about the changes. It is a distant second best because it could involve an extremely disorganized process, whose political outcome is unpredictable.
15 December
Mohamed El-Erian: Downward Spiral
Europe’s crisis is morphing again — for the third time in only 12 months — and the implications for the global economy are even more complex, unsettling, and troubling.
(Foreign Policy) It is critical for the welfare of billions around the world that Europe get its act together now. The continent faces an increasing probability of having to navigate a fourth potential morphing in the next few months. Should it materialize, this would take one of two forms: either a disorderly and highly disruptive fragmentation of the eurozone, or the establishment of a smaller and less imperfect eurozone that has a different relationship with the rest of the EU.
Both possibilities involve yet another set of immediate disruptions for Europe and the global economy. As such, the temptation among politicians will be to avoid making any active choices. But that would constitute a huge mistake. It would further reduce their future degrees of freedom due to an even narrower set of possibilities and, with that, erode their ability to influence outcomes.
As time passes, the option of a smaller and less imperfect eurozone is becoming the only way to “refound” a union that would have the chance to stand the test of time and, thus, constitute a key component of medium-term efforts to restore global financial stability, meaningful economic growth, and plentiful jobs. It is not an absolute best, and it would be a messy process involving the risk of collateral damage and unintended consequences. Yet, when judged in terms of feasibility and desirability, it sure dominates the alternative of a full fragmentation.
12 December
Paul Krugman: Depression and Democracy
… Unemployment in both America and Europe remains disastrously high. Leaders and institutions are increasingly discredited. And democratic values are under siege. … demands for ever-harsher austerity, with no offsetting effort to foster growth, have done double damage. They have failed as economic policy, worsening unemployment without restoring confidence; a Europe-wide recession now looks likely even if the immediate threat of financial crisis is contained. And they have created immense anger, with many Europeans furious at what is perceived, fairly or unfairly (or actually a bit of both), as a heavy-handed exercise of German power.
Nobody familiar with Europe’s history can look at this resurgence of hostility without feeling a shiver. Yet there may be worse things happening. Right-wing populists are on the rise from Austria, where the Freedom Party (whose leader used to have neo-Nazi connections) runs neck-and-neck in the polls with established parties, to Finland, where the anti-immigrant True Finns party had a strong electoral showing last April. And these are rich countries whose economies have held up fairly well. Matters look even more ominous in the poorer nations of Central and Eastern Europe.
Gwynne Dyer: EU crisis summit shows how deluded Europe’s leaders are
One senior European politician said angrily that British prime minister David Cameron was “like a man who comes to a wife-swapping party without his wife”, and there was some truth in that. Britain does not even use the euro currency, shared by 17 of the 27 EU members, but Cameron insisted on being part of the discussion in Brussels about how to save it. And in the end, he vetoed the solution that all the others had agreed on.
It was the eighth crisis summit of the European Union’s leaders this year, and it produced the fourth “comprehensive package” of financial measures to deal with the debt crisis. (The other three have already failed.) And if you judged the importance of the meeting by the scale of the uproar when Britain vetoed the EU treaty that was meant to stop the rot, it must have been a very important summit indeed.
The HuffingtonPost.uk has extensive coverage and range of opinions
Insight: The day Europe lost patience with Britain
(Reuters) – It was billed as a summit to save the euro. It may be remembered as the day Europe lost patience with Britain, as most of the continent threw its lot in with EU founding members France and Germany and committed to binding their economies ever more tightly.
10 December
The day Britain’s Prime Minister failed
Forget economics. This was a political moment, and it will be remembered as the time the politicians failed.
Angela Merkel failed: The German Chancellor could have used her country’s nearly unanimous clout to confront the root causes of the euro crisis, which lie in inequalities of trade and a collapse in consumption, but instead chose to pretend it was a matter of overspending by Mediterranean governments, to be solved with future rules. Mario Draghi failed: The European Central Bank chief could have launched a bond-buying, expansionist rescue – in short, acted as if this were the emergency it very much is. But instead he stuck to a suicidally narrow interpretation of his mandate, pretending that inflation, rather than its opposite, is the threat. But most of all, David Cameron failed. His withdrawal is a serious blow to Europe, the world’s largest single economy – making a collapse of investor confidence in the continent far more likely, and forcing the bloc into an imposed Franco-German solution rather than the sort of larger arrangement that Britain could have helped organize, if it had been constructive instead of destructive.
9 December
Niall Ferguson: Great Britain Saves Itself by Rejecting the EU
There is now a depression on the other side of the English Channel, and it is the continent that is cutting itself off—from sane economic policies.
(The Daily Beast) Last month I warned that the disintegration of the European Union was more likely than the death of the euro. You now see what I meant. The course on which the continent has now embarked means not just the creation of a federal Europe, but a chronically depressed federal Europe. The Eurocrats have exchanged a Stability and Growth Pact—which was honored only in the breach—for an Austerity and Contraction Pact they intend to stick to. The United Kingdom has no option but to dissociate itself from this collective suicide pact, even if it strongly increases the probability that we shall end up outside the EU altogether.
The Birth of a Two-Speed Europe
(Spiegel) … the summit’s outcome will seal the status of a two-speed Europe. Formally, Britain will remain a full-fledged member of the EU — and it will zealously insist on its rights. But Cameron will not be able to prevent his country from increasingly becoming a second-class member. That’s because European economic policy is likely to be determined in the future by the euro zone and its associate members.
… But Merkel and Sarkozy can’t be pleased with the outcome either. True, they have achieved their aim: The currency union will now be equipped with a balanced budget measure and automatic sanctions. On top of that, they have also succeeded in avoiding the protracted ratification process that revisions to the Lisbon Treaty would have required. However, Berlin and Paris haven’t heeded the ground rules of diplomacy. They didn’t seek any compromise with the British.
Europe’s disastrous summit
Somehow, in Brussels, EU leaders have contrived to pull defeat out of the jaws of victory on Thursday night, leaving Friday for finger-pointing and recriminations and wondering whether anybody who signed on to this deal has any chance at all of even getting re-elected, let alone being remembered as one of the leaders who saved the euro.
(BBC) Euro crisis summit: The night Europe changed
Last night most of Europe’s governments gave up a chunk of their sovereignty. In the future, tax and spending plans will be shown to European officials before national governments.
Europe moves ahead with fiscal union, UK isolated
(Reuters) – Europe divided on Friday in a historic rift over building a closer fiscal union to preserve the euro, with an overwhelming majority of countries led by Germany and France agreeing to forge ahead with a separate treaty, leaving the EU’s third biggest economy Britain isolated.
Europe’s New Budget Rigor, ECB’s Challenge
(Bloomberg) European leaders’ blueprint for a closer fiscal union to save their single currency left the onus on central bankers to address investor concerns that Italy and Spain would succumb to the two-year-old financial crisis.
(The Economist) … the EU’s tectonic plates have slipped momentously along same the fault line that has always divided it—the English Channel. Confronted by the financial crisis, the euro zone is having to integrate more deeply, with a consequent loss of national sovereignty to the EU (or some other central co-ordinating body); Britain, which had secured a formal opt-out from the euro, has decided to let them go their way. The agreement is heavily tilted towards budget discipline and austerity. It does little to generate money in the short term to arrest the run on sovereigns, nor does it provide a longer-term perspective of jointly-issued bonds. Much will depend on how the European Central Bank responds in the coming days and weeks.
8 December
Franco-British Alarm of 1989 Comes True as Merkel Calls EU Shots
In 1989, France’s Francois Mitterrand and Britain’s Margaret Thatcher maneuvered to block German reunification. Their concerns that the expanded nation would prove an irresistible force are now coming to pass.
As Europe’s financial crisis intensifies after two years and with 1.1 trillion euros ($1.5 trillion) of short- and long- term euro-area government debt due in 2012, German Chancellor Angela Merkel has forced French President Nicolas Sarkozy into retreat and left U.K. Premier David Cameron on the sidelines.
France’s Sarkozy warns Europe risks disintegration (BBC) “never has the risk of disintegration been greater” for Europe
Beware the Merkozy recipe The euro crisis cannot be solved by yet another one-sided solution
(The Economist) Ahead of a European Union summit, Angela Merkel, the German chancellor, and Nicolas Sarkozy, the French president, called for changes to the European Union treaties to enforce tighter fiscal rules. The pair said they wanted all euro-zone countries to introduce laws limiting government deficits, and for spendthrifts to be punished. David Cameron, the British prime minister, came under pressure from Eurosceptic members of his Conservative Party to hold a referendum on any new treaty.
28 November
EURO ZONE ON THE BRINK — A Continent Stares into the Abyss
(Spiegel) Fear is spreading through the financial markets as investors pull their money out of the crisis-stricken euro-zone countries. With Chancellor Angela Merkel opposed to using the ECB’s firepower to solve the crisis, the monetary union appears increasingly in danger of breaking apart. Some economists are even arguing for Germany to reintroduce the deutsche mark.
21 November
Honeymoon Unlikely for New Prime Minister
(Spiegel) Spain’s conservative Popular Party has won an historic election victory. But the incoming prime minister, Mariano Rajoy, will not have much time to savor his success. He will have to impose tough austerity measures to sort out his debt-ridden country’s finances. They could lead to massive protests.
17 November
Elections in Spain — Euro Crisis Set to Claim Next Victim
(Spiegel) Spaniards will go to the ballot boxes this Sunday for parliamentary elections in which polls predict that the conservatives will wrest power from the socialists. Though the party’s leader has fewer ideas and decidedly less charm, voters have simply grown too disappointed in the socialists’ efforts to salvage the country’s ailing economy.
16 November
Technocrats and democracy — Have PhD, will govern
(The Economist) The technocratic response to the euro’s problems is only part of a wider reaction to the financial and economic crisis: in many countries, the crisis has paralysed significant parts of the political system, leading to innovations and improvisations that try to short-circuit or patch up the normal working of democracy. … It is hard to rally the public behind austerity programmes at the best of times; even harder to solicit their support for measures to bolster a currency they do not like. Unsurprisingly, politicians have sent for outsiders to stiffen their resolve—and now have someone else to blame for the austerity measures they are imposing.
So what exactly is a technocrat anyway?
(Al Jazeera) What is a ‘technocrat’? And why are technocratic governments all the rage these days in Europe?
12 November
Berlusconi quits as Italy’s PM
(AP) — A chorus of Handel’s “Alleluia” rang out Saturday as Silvio Berlusconi resigned as Italian premier, ending a tumultuous 17-year political era and setting in motion a transition aimed at bringing the country back from the brink of economic crisis.
Silvio Berlusconi finally resigns as Italy’s prime minister, to cheers from supporters and jeers from foes
Silvio Berlusconi has resigned as Italy’s longest-serving post-war prime minister, bringing to an end a tumultuous, 17-year political career which was marred by sex scandals, corruption allegations and gaffes on the international stage. (CBC) Italian PM Berlusconi resigns
10 November
Two-speed Europe, or two Europes?
(The Economist) NICOLAS Sarkozy is causing a big stir after calling on November 8th for a two-speed Europe: a “federal” core of the 17 members of the euro zone, with a looser “confederal” outer band of the ten non-euro members.
The European Union is, in a sense, made up not of two but of multiple speeds. Think only of the 25 members of the Schengen passport-free travel zone (excluding Britain but including some non-EU members), or of the 25 states seeking to create a common patent (including Britain, but excluding Italy and Spain).
But Mr Sarkozy’s comments are more worrying because, one suspects, he wants to create an exclusivist, protectionist euro zone that seeks to detach itself from the rest of the European Union.
3 November
Former European leaders urge growth, not austerity
(Emerging Markets) In a personal message to French President Nicolas Sarkozy, who chairs the G20 Summit this week, dozens of former policymakers and high-profile economists, including the former leaders of Germany, Spain and the UK, said that sorting out the eurozone’s economic crisis was an “urgent priority”. [They] welcomed the Brussels agreement on Greece’s sovereign debt and the “more realistic haircut” for bondholders, an increase in the firepower of the European Financial Stability Facility and bank recapitalization as “decisive, necessary and major steps forward”. But … added: “Europe’s fiscal, banking and political crisis must also be resolved in a way that does not hamper growth prospects in the short term while putting into place credible long-term policies to reduce deficits.
11 October
Paul Martin blames Europe for economic crisis
Former Canadian prime minister Paul Martin has added his voice to the chorus of those blaming Europe for the world’s financial woes and calling on leaders to take decisive and immediate action to fix the problem.
Europe’s financial problems are largely related to fears that over-leveraged banks are vulnerable to a Greek debt default, which could in turn create a ripple affect that would freeze credit globally.
22 July

Analysis: Euro zone on bumpy road to fiscal union
(Reuters) – Angela Merkel will deny it, but Thursday’s euro zone deal to rescue Greece again from the brink of bankruptcy puts Europe on the bumpy road to a fiscal union.
By giving their bailout fund new scope to help countries before they are shut out of credit markets, recapitalize banks and buy bonds in the secondary market, leaders of the 17-nation currency area laid the foundations of a European Monetary Fund.
14 July
The euro’s real trouble The crisis of the single currency is political as much as financial
(The Economist) … throughout the sovereign-debt crisis, the requirements of financial crisis-management have collided with political, legal and emotional priorities. Indeed, the euro’s woes are as much about politics as about finance. European officials such as Mr Trichet parrot that the euro zone’s overall debt and deficit are sounder than America’s. Yet Europe lacks the big federal budgets and financial institutions to redistribute income and absorb economic shocks. And it has no single polity to mediate tensions within and between member countries. It is hard enough to get Californians to save Wall Street bankers; no wonder Germans bristle when they are asked to rescue Greek bureaucrats.throughout the sovereign-debt crisis, the requirements of financial crisis-management have collided with political, legal and emotional priorities. Indeed, the euro’s woes are as much about politics as about finance. European officials such as Mr Trichet parrot that the euro zone’s overall debt and deficit are sounder than America’s. Yet Europe lacks the big federal budgets and financial institutions to redistribute income and absorb economic shocks. And it has no single polity to mediate tensions within and between member countries. It is hard enough to get Californians to save Wall Street bankers; no wonder Germans bristle when they are asked to rescue Greek bureaucrats.
11 July
George Soros: Europe Needs a Plan B
(Project Syndicate) As integration has turned into disintegration, the role of the European political establishment has also reversed, from spearheading further unification to defending the status quo. As a result, anyone who considers the status quo undesirable, unacceptable, or unsustainable has had to take an anti-European stance. And, as heavily indebted countries are pushed towards insolvency, nationalist political parties – for example, Finland’s True Finns – have grown stronger, alongside more established counterparts elsewhere in Europe.
Yet Europe’s political establishment continues to argue that there is no alternative to the status quo. Financial authorities resort to increasingly desperate measures in order to buy time. But time is working against them: two-speed Europe is driving member countries further apart. Greece is heading towards disorderly default and/or devaluation with incalculable consequences.
If this seemingly inexorable process is to be arrested and reversed, both Greece and the eurozone must urgently adopt a Plan B. A Greek default may be inevitable, but it need not be disorderly. And, while some contagion will be unavoidable – whatever happens to Greece is likely to spread to Portugal, and Ireland’s financial position, too, could become unsustainable – the rest of the eurozone needs to be ring-fenced. That means strengthening the eurozone, which would probably require wider use of Eurobonds and a eurozone-wide deposit-insurance scheme of some kind.
10 June
Libya, Europe and the future of NATO : Always waiting for the US cavalry
(The Economist) The war in Libya, far from heralding a new era of European activism, has once again highlighted the limits of Europe’s military power, as Robert Gates pointed out today in his valedictory speech in Brussels.
3 June
Kenneth Rogoff: The Euro’s PIG-Headed Masters
Europe is in constitutional crisis: no one seems to have the power to impose a sensible resolution of its peripheral countries’ debt crisis. Indeed, it is hard to see how the single currency can survive much longer without a decisive move towards a far stronger fiscal union
… Absent the IMF, the one institution that might be able to take action is the fiercely independent European Central Bank. But if the ECB takes over entirely the role of “lender of last resort,” it will ultimately become insolvent itself. This is no way to secure the future of the single currency.
The endgame to any crisis is difficult to predict. Perhaps a wholesale collapse of the euro exchange rate will be enough, triggering an export boom. Perhaps Europe will just boom anyway. But it is hard to see how the single currency can survive much longer without a decisive move towards a far stronger fiscal union.
10 May
‘Greece Needs a Kind of Marshall Plan’
(Spiegel) What is the euro zone planning to do about Greece? A host of theories, denials and accusations have dominated the headlines this week, but no clear path has yet emerged. German commentators say that Athens needs more than aid — it needs massive European investment.
9 May
Timo Soini: Why I Won’t Support More Bailouts
Insolvency must be purged from Europe’s system and it must be done openly and honestly.
18 April
Finland’s election — Truly amazing
(The Economist) THE cosy consensus of Finnish parliamentary politics was shattered yesterday, when the True Finns, a populist Eurosceptic party, emerged from near-obscurity to take third place in a closely run general election. The result will be carefully noted by European leaders as efforts continue to restore confidence in the euro.
The leader of the True Finns, Timo Soini, has pledged to veto future aid packages for struggling euro-zone countries, such as Portugal.
17 April
Finnish poll turns on anti-euro feeling
(FT) Early results show advances for populist party amid growing public resistance in several northern European countries to taxpayer-funded rescue packages
Roger Cohen: France Flies, Germany Flops
We stand at a high point in French postwar diplomacy and a nadir in German. There were strong arguments on either side of a Libyan intervention, but with a massacre looming in Benghazi, Germany had to stand with its allies. Angela Merkel has proved herself more a maneuverer than a leader. Germany often conveys the sense that it now resents the agents of its postwar rehabilitation — the European Union and NATO.
That means several things. European integration is on hold, and as long it’s on hold the future of the euro is at risk. The German-French alliance will remain under strain. Obama should look to Sarkozy, not Merkel, for strategic support.
15 April
Why Elections in Finland Could Doom Portugal’s Bailout
(Spiegel) Right-wing populism has arrived in Finland. The True Finns stand to gain close to 20 percent of the vote in Sunday’s elections on an anti-Islam, anti-Europe platform. That could be bad news for Portugal. [Please see Comment #1 below for another view]
30 March
The Fundamental Problem with Efforts to Save the Euro
In the battle to save its common currency, Europe is too busy focusing on the same old failed policies. Rather than set aside ever higher sums for bailouts, the bloc needs to set up an independent institution to oversee the debts of EU nations.
28 February
The first European casualty of the Arab uprisings
(The Economist) … the wave of revolution spreading through the Arab world has caught France unprepared, exposed its complicity in the region and weakened its voice. The departure of Michèle Alliot-Marie as foreign minister, announced yesterday by Mr Sarkozy in a televised address, is a belated attempt to repair the damage. In [her] place, Mr Sarkozy has named Alain Juppé, whom he described pointedly as “a man of experience”. … Mr Sarkozy spoke yesterday of “a new era” in France’s relations with countries on the southern Mediterranean shore. The only spoiler was that he also called for a fresh lease of life for the  Union of the Mediterranean, a moribund grouping that has not met since Mr Sarkozy launched it in Paris in 2008, and which was co-presided by none other than Egypt’s Hosni Mubarak.
The EU Has Failed the Arab World
(Spiegel) For weeks, a blossoming democratic movement in North Africa has been toppling one dictator after the other — first in Tunisia, then in Egypt, now possibly in Libya. During this whole period, the reaction of Europe’s governments can best be described as paralyzed. While Gadhafi’s regime was ordering its forces to fire upon its own people, the reactions of the political elites — whether in Brussels, Berlin, Paris or Rome — were unsure, divided and without a plan.
They asked themselves whether they should send in troops or impose sanctions. They worried about a massive influx of refugees and whether it was appropriate to get involved in what could turn out to be a long civil war. Some floated the idea that Europe should launch its own version of the Marshall Plan, but others wondered who would pay for it. Now, six weeks after the protest rallies started in Tunisia’s capital, the Europeans were asking questions — but finding hardly any answers they could agree on.
23 February
Does Europe bankroll Arab despots?
(The Economist/Bagehot) British officials are briefing up a storm about a looming scrap with France and other “Club Med” EU members in Brussels. The battle is over the billions of euros in EU aid sent to north Africa and parts of the Middle East over the years, without a great deal to show for it by way of political reform. With the brushfires of revolt still burning across the region, Britain thinks it is high time for a serious debate about what, exactly, all this money is for.
17 February
Belgium’s ‘chips revolution’ marks no-government record
(BBC) Belgians have staged a series of tongue-in-cheek events to mark what many there see as a new record – the world’s longest wait for a government.
Belgium has been without a government for 249 days – longer than Iraq – as parties from the Dutch-speaking north and French-speaking south remain split.
13 January
Euro crisis: The only way to save the euro is the destruction of its members
By Peter Osborne
(Daily Telegraph) Since the coronation of Charlemagne as Holy Roman Emperor in 800 AD, there have been numerous attempts to unify Europe. Philip II of Spain, Louis XIV, Napoleon and Hitler all came tantalisingly close to success, but all ultimately failed. Today a fifth attempt is under way through the European Union.
Though not associated with a single great or powerful man, the ultimate objective of the EU is otherwise more or less familiar to students of European empires: no internal boundaries; a single currency; one parliament; one central government; one army; one foreign policy and a single political unit stretching from the Atlantic to the Urals.
The 27 nations that currently comprise the EU would merge into one huge state, accounting for a population of some 500 million, approximately one fifth of global wealth and an even higher percentage of the world’s trade. Such a nation would take its place alongside the United States and China as a superpower.
This project, in its way both noble and visionary, is surprisingly close to realisation. Many people fail to grasp this point because they have been distracted by the headlines on financial pages signalling daily woe and disaster for the eurozone countries.
But these setbacks were long ago foreseen by the architects of the EU. Jacques Delors, the French politician who more than anyone else was the architect of the single currency that is used today, is a highly intelligent man. He was warned many times by critics such as Margaret Thatcher that it was hopelessly premature to set up a monetary union without full political unification. He knew very well there would be problems.
But Mr Delors saw these problems as opportunities – what have been called “beneficial crises”. These economic crises, he believed, could be exploited by the European governing class to expedite with extra urgency and dynamism their over-riding project of integration, and the creation of a single European state.