And there are several story lines unfolding in parallel:
- Osborne went on record over the weekend, saying that a new EU treaty to fix the eurozone is now "on the cards". According to the Telegraph, a proposal will be tabled in the autumn which would see negotiations over the Treaty commence as early as December. This is clearly a moving target - and we shouldn't draw hasty conclusions. But potential talks over a new EU treaty so soon is clearly big news.
- It comes as a group of 90+ MPs will meet tonight in Westminster, as part of a new initiative to help the Government come up with constructive ideas for how to re-order the UK's relationship with Europe. In an interview with Saturday's Times, Foreign Secretary William Hague appeared to semi-endorse the group, saying: "I was talking to some of them about it last night…It’s certainly not career suicide. I’m always pleased by good, healthy, democratic debate. They’re not approaching it in a confrontational spirit. They will be welcome in this office to discuss it.”
- Osborne also said over the weekend that Hague was drawing up a list of demands for powers to be repatriated to Britain in return for treaty change. To us, it seems increasingly as though the UK government has made a policy shift over recent weeks, and is now openly acknowledging that the aim is to bring some powers back should a new EU Treaty be up for negotiation.
- ECB Chief Economist Jürgen Stark resigned from the ECB’s Executive Board on Friday “for personal reasons” – although the move is almost certainly linked to disagreements over the ECB’s on-going purchases of weaker eurozone countries’ bonds. As Handelsblatt notes, his resignation has made it clear that "Germany's stability culture has not managed to prevail within the ECB. The Central Bank is increasingly becoming an instrument of politicians."
- Ambrose notes in the Telegraph, this move marks "a German vote of no confidence in EMU management." The decision has thrown global markets into fresh turmoil.
- German media report that officials at the German Finance Ministry are looking into the consequences of not lending Greece more money. Two scenarios are being discussed, according to Der Spiegel: Greece going through a hard default but remaining in the eurozone; or going through a hard default and leaving the single currency.
- In a further sign of the tensions within Germany, the junior coalition partner to Angela Merkel, the FDP, are planning to organise an internal referendum on the future of the European Stability Mechanism (ESM), the eurozone’s post-2013 permanent bailout fund. The article notes that 3,400 signatures – about 5% of FDP members – are needed to call this referendum. If one-third of party members take part in the vote, the result becomes official party policy.
- In an interview with Greek TV channel Mega, Greek Deputy Finance Minister Filippos Sachinidis has warned that Greece will run out of liquidity next month, if the next tranche of the first EU/IMF bailout is not paid out.
There's clearly no such thing as a quiet EU news week any more.
If Greece would have to go through a hard default in either scenario, there would seem no point in it remaining in the euro, one of the sources of its problems.
ReplyDeleteGreece entered the Eurozone on a false prospectus of its finances aided and abetted, allegedly, by concealed loans from Goldman Sachs. Most of the Eurozone countries knew that Greece did not meet the criteria for joining the zone, but still pressed ahead. The Greek tragedy is a self inflicted own goal
ReplyDeleteFor one of the most frank and outspoken assessments of current Greek Government opinion see the interview on www.rt.com with Mr Simos Kedi koglou. He makes the very valid point that Germany is loaning money to Greece at a higher rate than it is charged itself and has already cost Greece more than the original loan.
The ECB has issued loans which are at least four times higher than its 2009 capitalisation of 850 million euros, as far as I can ascertain from its arcane accounting system. This is unsustainable, and it is vital that Britain does not become involved in any further bailouts. The disintegration of the Eurozone into fractious squabbling countries is surely a matter of weeks away, and the resignation of Juergen Starck at such a critical stage of the debate adds momentum to the uncertainty surrounding the future of the Eurozone.
It is useless going for a redraftng of rules.Any arrangements thereby achieved would be nullified when the fuss dies down, as it will eventually, and those who have been seeking a US of Europe go on again towards that end. Whatever happened to democracy? There will never be any in the European hierarchy. The nettle must be grasped, and the opportunity exists now, to opt for EXIT. It is probably the only such chance we will have in the whole of our remaining history as a nation.
ReplyDeleteLes B.
Probably this will be mugged by the blog author but in view of the post-democratic actions of the EU Commission and the party leaders there will be NO re-ordering of anything. Under Lisbon there is no need to!
ReplyDeleteThe only solution is an in/out referendum.
The project that has been put together by stealth ie "The United States of Europe" is at last beginning to unravel.
ReplyDeleteMany years ago I voted in the referendum to have closer trading ties with other European Nations. I did not vote for political and financial integration. The "Common Market" as it was then called was an excellent idea. This has now morphed into the "European Economic Community" and now the "European Union. The EU has it's own flag and currency, it's laws transcend ours, from the Common Agricultural Policy to Fishing to Human Rights to accounts not being signed off it has been a disaster for the UK.
Even worse I have not had the chance to vote in a referendum to determine if I want to be governed by unelected representatives from other countries.
The sooner this rotten, corrupt, expensive, undemocratic, institution founders, the better.
Enough said - out now
ReplyDeleteCould any poitician of any party please explain why we have still not had a "promised" Referendum and "What" is the attraction belonging to such a corrupt,undemocratic,greedy,unaccountable and unrepresentative monster governered by self regulating and grotesquely overpaid nobodies.
ReplyDeleteClive Taylor-Sholl
Co.Durham
The biggest confidence trick ever pulled in history took the British populace into the EUSSR. I am seeing at first hand what Greece is all about and believe me, it is appalling the corruption here. Are we expected to join with this lot - well it seems our own MP's have, but then they never listen to the voters anyway !!
ReplyDelete