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Wednesday, April 03, 2013

"Why EU mandarins refuse to learn"

Has anything changed since the 15th century?
Die Welt’s Foreign Affairs Editor Clemens Wergin today has a blistering op-ed on the current state of affairs in Europe, entitled “Why EU mandarins refuse to learn”. Here are the key parts:
“The disastrous decisions regarding the future of Europe have been completely without consequences. Despite all the mistakes made the system appears to be incapable of adapting. The tanker remains on the wrong course.”
“It belongs to the biggest disappointments for convinced democrats that up until now, neither on the European level or on that of the nation states, there are no noteworthy efforts to clarify the causes of the euro crisis… The Bundestag has also not covered itself in glory. There has been no cross-examination of Hans Eichel and Gerhard Schröder why they agreed to let Greece join the euro despite the fact that already then there was a strong suspicion that the Greek figures were problematic.”
"Democracy is adaptive and able to correct itself. However this is out of the question in the worst crisis to hit Europe after the war. Here, the euroscepticism of many of the continent’s citizens is justified. They see that in this crisis that this Europe is not created on transparency, enlightenment and accountability. This creates the impression that they are dealing with a conspiracy of the elite, conspiracy against common sense."
“EU elites are afraid of washing their dirty laundry for fear it will portray the European project in a bad light… It is part of the pride and ethos of a democratic polity to clarify failures and to draw consequences.”
“With the exception of the changes to the eurozone’s regulatory framework forced through by the Germans there have been no intentions of rethinking the fundamental assumptions of the EU… One gets the justifiable impression that nothing can divert EU mandarins from their current path and their pre-conceived opinions. The euro has not worked? Ok, let's try an even higher dose of community building… In Brussels they mourn over bad poll numbers and believe that this is only down to national populists who have wrongly explained Europe.” 
"With Portugal, Spain and Greece there was once the quiet hope that good European governance would be diffused via a kind of osmosis process from the EU headquarters in Brussels into the periphery. That has worked only in part. In some respects, the abundant money from the EU’s structural funds has had the opposite effect to that which was intended. They have strengthened clientelistic structures and made people there believe their system somehow works. Ultimately, politicians always had enough money via Brussels assistance to distribute to cronies and voters. As long as money was available, many people profited from this system. Then along came the crisis which showed that it just does not work and carries with it significant competitive disadvantages.” 
"At present, the EU is obviously not an adaptive system. Nothing is solved, no one is held accountable. Responsibility for consequential mistakes is lost somewhere between the many capital cities and the corridors of Brussels. As long as this does not change, one should not be surprised by the bad reputation that this European undertaking enjoys among citizens."
 Taking no prisoners. For German speakers, it's worth reading the entire piece. 


Anonymous said...

Whether you love or hate the EU this surely encapsulates why it is failing and why it ultimately will fail.

The detachment between "Brussels" and the people of Europe grows daily.

Anonymous said...

What does it take to fix this situation?

Closer political union, fiscal union, debt-sharing? How realistically could this be implemented in the near future?

What reforms are required to prevent structural funds from being misappropriated? An independent anti-corruption unit within the EU that investigates the usage of these funds?

How will things get *moving* on all of this?

Rik said...

"In Brussels they mourn over bad poll numbers and believe that this is only down to national populists who have wrongly explained Europe.”

To remain in the Middle Kingdom:
Free translation:
-Know yourself, know the enemy in 1000 battles you will never be in danger.
-Only know one of these 2, the outcome will be 50/50.
-Don't know yourself, don't know the enemy you will always be in danger.

Rik said...

Picture look Ching (1644- ).

jon livesey said...

"In some respects, the abundant money from the EU’s structural funds has had the opposite effect to that which was intended. They have strengthened clientelistic structures and made people there believe their system somehow works. "

This is perfectly put. Subsidies ultimately never work, for companies, industries or countries, because they don't encourage improvements in efficiency. Instead, they make inefficiency more affordable.

95% of the EU budget consists of transfer payments, and all that money is doing is bribing inefficient countries not to reform.

Anonymous said...

And when it is over I want each and every one of the UK's politicians on frial for treason. All those who undermined our democratic process and handed sovereign powers over to a bunch of idiots (without our approval) need to explain themselves.

This must never happen again.

christina speight said...

The EU has accumulated invoices and now has outstanding debts totalling €217.3 billion for the current multi-annual budgetary period. The European Parliament is now calling for member states to "break the vicious circle of unpaid debt".. The UK and The Netherlands are the first to refuseany extra money.

Under EU law carrying over debt from one year to another is illegal. But for years nobody has done anything about it. Now the EU is broke and needs a bailout.

Richard North’s EUReferendum blog [to whom I am indebted for these facts] suggests ironically that “Adopting the ---- solution which the Commission proposed for Cyprus, we can see the obvious way out. The bank accounts of all Commission employees should be frozen, the assets of the EU institutions sequestered and then there should be a massive series of compulsory layoffs and a fire
sale of property.

But since, under EU law, the institutions cannot carry over debt from one year to another, we will have to express regret that we cannot lend and money to them. The whole lot will simply have to be wound up – terribly sad, we agree, but these things have to be done.”

In any case to find such an astronomical sum would be impossible so the answer is going to be as usual that the EU will just continue breaking its own laws, as in so many other areas

christina speight said...

Reading the BILD article carefully it is clear that they too are in total denial . Take "there are no noteworthy efforts to clarify the causes of the euro crisis"

The cause of the euro crisis as so many of us prophesised and foretold is -- THE EURO!. It is impossible for 17 countries (and more idiots want to join though the Danish VOTERS have said 'go away' ) -- it is impossible for 17 sovereign countries to have a single currency without a single treasury and Central Bank with common taxation and debts.

Also the Treaty expressly forbids "Bail-outs" of any single country. The EU mandarins in their utter arrogance just ignore this law. Greece, Spain, Portugal and Greece (Italy ???) should have all quit the Euro and sorted themselves out. By breaking the carefully thought-out law they have wrecked Europe. They should all be prosecuted for criminal conspiracy.

Anonymous said...

The author misses the point, which is: The Euro was designed to fail to force the issue of a global, electronic currency controlled by the same people who created the Euro.

Such a global currency is an increase in power and it's part of the plan.

And, yes, it IS a conspiracy, of that there can be no doubt.

The self-appointed elites' plan isn't failing, it is working extremely well.

that is the reason they do not change course.

Rik said...

@Christina 10.57
Like the idea, freeze that guy Barosso's bankaccount.
Rompuy's to so he cannot buy paper to write his horrible poems on.

It is however possible to have a monetary union without a proper CB and mutual debt and more of that sort of things.
Countries should however adjust their economic and financial policies to that, things like:
-Maastricht, no debtlevel higher than 30% under normal circumstances, so there is room when things go wrong.
-Not allow (possible) bubbles to blow up, keep RE pricerises moderate and assure financing is done conservatively 20% at least up front.
-act directly on unbalances (and donot leave them alone when they are politically convenient like wages rising rapidly, debtlevels rising rapidly, structural looking tradedeficits, RE pricerises similar);
-act on unbalances in current account when not used for hard investments, act on overreliance on foreign financing when that can be revoked basically by the minute.
-keep a bufferfund for Keynesian stimulus if your own country is out of line with the rest.
Things like that.

Had the PIGS FIB CS done that there would not have been problems.

It also required the treaty/agreement to be seen as a sort of gentlemen's agreement to bring each other not in danger. Difficult to see the Finns or the Dutch not doing that when things would go wrong in their country.
They would take the Flak.
However a lot of the other participants clearly were no Northern style gentlemen, but more a bunch of secondhand car dealers.

As proof that it worked is the peg between Benelux, Austrian etc currencies with the DM. Worked fine. No official agreement. No CB at all. No centralised fiscal/economic policies. Much less than the EMU but worked much better as that set up kept the garbage/problemmakers out

Problem is to say it plainly with the Latin bunch. They have clearly other ideas about agreements than:
pacta sunt servanda (might be Latin but from days long gone). A mentality that simply doesnot work within such a large diverse group. And the rest letting them get away with it until the manure hits the plafondrotator doesnot help either.

With these kind of Barosso-countries remaining in the group
you simply need strict detailed rules and strict supervision and enforcement. Which seems not to be possible. The adjustments proposed until now look like a joke.
Which means that even if this crisis would be solved with the whole disaster area still intact (quod non), you can wait for the next crisis. Might take a few years but it will come.

As you indicate and most analyst seem to forget this is not only about solving this crisis. This is also about setting something up that actually can work. And it is clear we both donot see that (the latter) happening.

Rik said...

The picture is probably made by a Westerner. Etching is a technique hardly used by the Chinese. Composition is also very Western.
Honsho with head much lower than even the servants unusual as well.
Paper as well looks Western.

Probably mid/late 19th Century, may be even very early 20th.

The guys are clearly Ching. You can see that at eg the ponytails. Which were clearly Ching and from a the later part thereof.
Also the flap the guy on the right has over his hand is clearly Ching. Symbol of the hoofs of a horse (as they were a nomadic Northern Mantsjoe tribe).

That is about as far as my knowledge of Chinese art goes. But one thing for sure no 15th century.