Wednesday, May 23, 2012
It is not very easy to get a clear answer with a yes or a no, especially when the question can not be presented to the people in a format that will require just two answers. The hardest thing will be to persuade the Irish voters to vote for something that only the Irish political elite understands its importance!
But how is the debate in Ireland faring? So far the YES side has an advantage, yet there is a large undecided portion of the electorate that could swing the result either way. About a third of Irish people are still undecided. So the debate is heating up for the past two weeks, in an effort to influence the public opinion.
The result of the referendum won't have any immediate impact to the rest of the EU states or the Treaty's implementation, since the Treaty requires 12 out 17 eurozone states to ratify it in order to be implemented. So even if Ireland votes NO, the Treaty can still be ratified if the majority of the other EU states approve it. This Treaty is very important for the economic future of Ireland, but that of Europe too.
Though Ireland's decision can not be decisive this time like in the case of the Lisbon Treaty referendum, nevertheless the "Eurosceptic" groups have already landed on Ireland to push for a NO vote. Mr. Nigel Farage MEP, a well known British eurosceptic but also Mr. Declan Ganley, founder of the eurosceptic group "Libertas" are already here to help defeat the Treaty. Understandably though, all eyes of Europe are on Greece and France at the moment. Because of the recent developments and huge changes that happened there after the recent elections in both countries.
Some are calling for a postponing of the referendum in Ireland, on the grounds that Ireland should not vote and expose itself if the vote is NO, in case of a formation of a Greek anti-austerity government that might lead to the country's exit from the eurozone. Or if Mr. Hollande, France's new President, manages to end or losen the German led austerity policies in EU.
The effects of either developments though, won't be known for months to come and Ireland's Taoiseach Mr. Enda Kenny TD has declined any calls to postpone the referendum. Besides, even if Hollande and the Greeks manage to convince the rest of Europe and especially Germany on a growth pact for EU, this Treaty won't be renegotiated.
The Irish Government and many other political groups supporting the Treaty, have launched a "myth debunking" to counterpart the NO supporter's claims that link this Treaty with austerity. The NO side has linked every austerity measure approved by the Government, like the new household and water charges to the Treaty in order to gain support. I generally disagree with the NO campaigners' stance, though I totally understand their reservations. But by trying to exploit the current economic crisis and the public's disapproval of the austerity measures in order to gain support, they are in danger of failure.
This Treaty is not an EU Treaty, rather an intergovernmental agreement, a promise of one state to each other in keeping their books in order. Now why this hasn't been happening until now and we need this Treaty to bind our leaders to do the "right thing," keeping some budgetary discipline that the eurozone membership requires, is something that I do not understand.
Our leaders seem to behave like children that do not trust each other and need to put in place different treaties to make sure no one cheats. If the Czech Republic and Britain had agreed to be part of this Treaty, then it would be an EU Treaty. There are plans and hopes though that this Treaty will be incorporated into EU law in 5 years time. In this case the Irish might be called to vote again anyway.
The Treaty has nothing to do with the recent water and household charges, and it won't increase those charges if it comes into effect. The Treaty does allow some policy flexibility in exceptional circumstances, like a severe economic downturn. It does not affect Ireland's taxation system and its corporation tax rate remains untouched. But Ireland won't be able to get a bailout or any funds from the ESM (European Stability Mechanism), the EU’s new bailout mechanism if it votes NO. Other suggested sources for future funding are heavily disputed.
In a nutshell, we do need to control our finances and how much debt we can afford to accumulate. Since we share the same currency such move only makes sense. I do not understand why something like this was not happening until now. Huge levels of unsustainable debt is one of the reasons why Europe is in the grip of this recession. So any treaty that controls our debt and provides with a safety net from which we could draw funds to deal with any future crisis makes sense.
The only argument that I will give to the NO campaigners, is that if we examine the current pro-austerity policies that most European elites seem to follow, then it is clear from where our governments will be keen to cut funds in order to keep their country's debt low; from the social welfare, the salaries and benefits of the workers.
Now in some cases a reform is necessary and long overdue. But as we have seen in the case of Greece, harsh austerity without growth initiatives simply do not work. So what I would really like to hear from our governments, is what policies are they willing to create in order to keep their country's debt in check, in order for me to support fully the Treaty.
Yes, it is fair for the creditor countries to get safeguards that other countries won't act irresponsible, and we got to accept that when in the eurozone, you can not have full fiscal independence anyway. We got to prevent countries of borrowing too much. But punishing the countries that break the rules did not always worked in the past, so what make us believe that it will this time.
This Treaty is only part of the solution to the eurozone crisis. Growth initiatives, the eurobonds and other measures must also be included and promoted in the revival of the eurozone.
Austerity was accepted by signing the IMF/EU bail outs deals; can we avoid austerity by voting NO now? Can we reverse the austerity packages and annul what our previous governments have signed to already? In Greece the Syriza party and its leader Mr. Tsipras believe so. It only remains to be seen how they are going to achieve such thing.
But this Treaty is not only about austerity. It will allow Ireland to have access to funds, a benefit that with this Treaty now is linked to its ratification; there was not such obligation in the Stability and Growth Pact 2011. Other differences of this Treaty with the Growth Pact are that the structural deficit target is subject to enforcement and that the targets must be incorporated into national legislation. Thus they are far more binding.
Ireland will be contributing to the stability of the euro currency and show a sign of good will to foreign investors that the country is committed to the euro and continue to invest in the country, by voting YES. A member state is still free to reach balanced budgets by their own policies, provided the targets are reached. Coordination of economic policies are encouraged, but not harmonization.
The European Commission and Council will monitor a state's progress and a member state can submit its observations on the Commission's report. The Commission may then recommend to the Council that action must be taken and refer the matter to the European Court of Justice. If another member feels a state is in breach of the terms of the Treaty, it may bring the matter to the European Court of Justice.
In other words, each state is not only responsible for its own finances, but it can take action against those who do not comply by the rules. No wonder then Britain and other "Eurosceptic" states are against the Treaty. They just want to keep the perks of fostering the markets' manipulators and big bankers and so they are trying hard to stop this Treaty.
So what will the Irish people eventually vote for? I have to say that this campaign is far more organized than the Lisbon Treaty referendum, and it gives far more information to the issues that matter the most. But as in the Lisbon referendum, the promised stability and job creating did not really arrived, even after the Irish voters ratified it.
There are a lot of weaknesses in the eurozone and the "European Project" that need to be addressed and solved first, before we can promise the European population long lasting stability. Can we expect now the Irish voters to trust their political elites this time? Will the Stability Treaty bring the much needed stability in Europe and if yes, for how long? Perhaps until the next crisis?
Tuesday, May 15, 2012
Wednesday, May 9, 2012
Herman Van Rompuy: “The EU will never become the United States of Europe” | euronews, world news
Herman Van Rompuy: “The EU will never become the United States of Europe” | euronews, world news
Tuesday, May 8, 2012
In France we saw the victory of Francois Hollande over Nicolas Sarkozy. Hollande, a socialist, clearly based his campaign against austerity and he said that his victory is a message of the French voters; they voted for him because they reject the austerity measures that were encouraged by the "Merkozy" collaboration, or the French-German axis as many have described it. What remains to be seen now is how will Berlin and Paris continue this cooperation and what the future is for the Fiscal Treaty. In Ireland we are having a referendum on it very soon and some now are suggesting that there is no point of having it, or that we should postpone it.
Mrs Merkel has already congratulated Mr. Hollande for his victory and stated that she will expect him in Berlin with "open arms," but the future of the Treaty is not negotiable. She expressed that she is looking forward to their cooperation. What will be the new dynamics that will form and where will this new cooperation lead Europe? Will Mr Hollande keep his promises and how will Germany and Merkel react to his positions? Will we have an end to the austerity policies imposed all over Europe and will Hollande be influential enough to gain the support of other EU leaders to change the European austerity agenda?
We have a socialist government back in France, after 17 years. All this time the conservatives were ruling France, one of the three main European powers and it will be interesting to see how this new combination of a socialist France and a conservative Germany will lead Europe. Merkel obviously favored Sarkozy, but I feel that we needed more balanced European politics. For me it is a positive outcome, we need a powerful socialist eurozone country to counterpart a conservative one. We need both voices and opinions to control each other, but I hope they are going to be able to cooperate for the betterment of our continent.
Mr Hollande views on what needs to be done to stimulate growth are totally different from what Mrs Merkel and Mr Sarkozy were favoring. Instead of cut backs and austerity, Hollande favors the increase of public spending, with a raise of the minimum wage and more investing in the public sector. Of course a compromise will be needed from both sides and that is what makes it so interesting. What will eventually got to give?
Another very interesting outcome of the French elections came from the previous weekend and the first round of the electoral campaign. The far right in France saw the public's support rising and they manage to get almost 20% of the votes. Led by Mrs Marine Le Pen, the Front National (FN) party in France came third in the elections and that adds one more country to the chain of many other in Europe that are turning to the far right. Fed up and disappointed with their government's mishandling of their country's financial and immigration problems, the people are seeing nationalism as the only way to protect their way of life.
And that tendency was manifested in the Greek elections too, in one of the most dramatic electoral results in the recent Greek and European history. The Greek voters punished the two mainstream political parties, by turning their backs to them. But that is the only good thing that came out of these elections. In my opinion, it was about time to end the monopoly and dominance of PASOK and the New Democracy party in the country's political life. They are responsible for Greece's demise, as they were in power for the past seven decades, each replacing the other.But in what cost?
The Greek people, fed up with the austerity imposed on them, voted off the parties that supported the EU/IMF bail-out deals. LAOS is out of the parliament, PASOK came for the first time in its history third and New Democracy even if it came first, saw its popularity plummeting. A surprise came from the radical left party Syriza that became the second strongest party and its leader Mr. Tsipras the youngest party leader to enter the Greek Parliament. The most worrying development that we witnessed in these elections was of course the entry in the Greek Parliament of the far right, neo-nazi party the Golden Dawn. They got 20 seats in the parliament and 7 % of the votes.
In my personal opinion it is a disgraceful and shameful result for our nation. In a country that lost one million people during the WW2 because of the Nazi atrocities, to have a neo-nazi party in the parliament is totally disrespectful to all those dead. But I am not blaming the public. What can you expect from the average citizen when the political parties who they trusted all these years to provide a better future for the country, have greatly let them down. Greece's economy is in tatters, the country's reputation is damaged and there is a real demographic and immigration problem that is left unchallenged.
When the supporters of the Golden Dawn, escorted the elderly Greeks to go and collect their pensions in central Athens protecting them from criminal attacks, is it any wonder that they won the public's support? The are the only party who promised to do something about the problem of illegal immigration in Greece, while the two main political parties failed to even put it in their agenda. Illegal immigrants are turning to criminal activities to sustain themselves and make a living, bringing them in clash with the native population. A clear and updated immigration policy would resolve the issue, something that the established political elite of Greece has so far failed to agree on.
The debate among the public before the elections was very interesting and it gave clear signs of what was to come. A growing number of Greeks vowed not to vote for any of the two main parties. They felt that those parties did nothing all those years to solve the country's problems, so why would they now. Speaking with friends and relatives prior the elections, I got some interesting feed-back. Some admitted that they intended to vote for the Golden Dawn party, because it was the only one to promise solutions to Greece's immigration problem. Others said that they would vote for PASOK or ND because their parish priest advised them that it would be good for the country, while some others because they would bring stability. And some turned to the left or communist parties, or any party that opposed austerity and promised to reverse the deals that were signed during the EU/IMF bail out agreements.
The result from these elections is hard to predict. Instability and uncertainty is the only sure thing. Even if the New Democracy won the majority of the votes, it is marginal. To form a government they will have to collaborate with another party. The Golden Dawn has rejected such collaboration, while the leftist Syriza party is also not negotiating. That will most likely lead to a PASOK-ND collaboration perhaps with a third party. Some already fear that the negotiations will fail, Greece will be unable to form a government and another election will be needed by mid June. Some others see no point in all this and believe that we should have voted for PASOK or ND to ensure the stability the country needs, leaving our disappointment and anger aside.
The last group claims that nothing has been achieved by shaking up the monopoly of the two main parties. We will have more elections until we get a functioning government and the Greek people will eventually vote back for either PASOK or ND to ensure that. Others think that a coalition government will be formed anyway and will most likely be formed by ND with the assistance of PASOK and another willing party to stick to Greece's signed obligations to the EU, Europe and the eurozone. But who will that party be, knowing that they will become very unpopular among the Greeks.
Others are pleased for teaching a lesson to the political established elite of the country, notably the PASOK-ND parties and challenging their dominance. In my opinion it is a positive outcome, one long delayed. We need new blood in our country's politics, we need new voices and new ideas to deal with our people's needs and worries. I was just hoping that far right and far left groups were not the ones who gained the most. But as some claim, such thing is inevitable; populism is always what the voters go for when they are dissatisfied with their governing elites.
Now we have to deal with the Golden Dawn and its leader, Mr. Michaloliakos and their antics and ridiculous ideologies. In an press conference after the party's victorious entry to the Greek Parliament, the attending journalists were asked to stand up in Mr Michaloliakos' entry into the room. Those who refused to do so, where ousted by the party's members! Not a sign of a democratic party, rather a military organization. Not something that I, an 100% pure Greek descended male, will be proud of.
To conclude, the message from both elections is that the Europeans do not want anymore austerity, but they do want more security, prosperity and national pride. They want jobs and better living standards, they want a country that they can feel proud of, a just society to live in. The more their governments are ignoring them and favor policies that serve the banks and the markets, they more far right and left elements, populism and nationalism will be finding their way into Europe's politics; but only for the detriment of our continent and its people. I hope that some good will come out of all this and that should be a more functioning European democracy, on a national and European level.
Tuesday, May 1, 2012
After an initial criticism and uproar, European people finally are starting to understand that Greece has been wrongly accused as the "deceiver" in the European family; if anything, the deceivers are the European governing elites.
In France, Germany, Holland, Ireland, Italy, Denmark, Finland and other European countries and their capitals we had protests of support towards the Greek people. In social networking websites there have been numerous pages created, stating their solidarity to Greece. But one of the most moving cases was that of a number of Italian mayors, donating their monthly salaries to the poverty stricken Greek families.
First of all we need to understand that Greece is not the cause of this crisis; it has actually originated in America. Greece is not the only country who overspent, all western economies are heavily indebted; that is the economic model we all followed. And if we look at Italy, Portugal, Spain and other EU countries, Greece is not the only one rigged with corruption, outdated social policies and lack of reforms.
The reality is that the euro-zone was flawed by its creation and foundations. Its flaws were manipulated and exploited by "The Markets," a powerful group or lobby of investors, bankers and speculators-high society gamblers if you ask me- that make profits out of currency manipulation. It is not the first time we experience such thing, we witnessed the attack on the British sterling by Mr. George Soros and his companies. Now it is simply the turn of the euro.
Just to examine where the euro-zone is flawed, when we have two countries- Germany and Greece for example- engage in free trade, the country with the slower rate of productivity growth normally experiences a depreciation of its currency. But currency depreciation need not occur.
There are other possibilities: its workers' wage rates could grow at a commensurately slower rate; it could experience ever-increasing unemployment; its workers could emigrate; or it could find some means of "validating" its increasingly over-valued real exchange rate. Greece chose the last of these options. And the means it chose to validate that was to increase government spending, financed by borrowing.
Over the last decade, unit labor costs in Greece have grown by about 30% more than in Germany. This implies a 30% effective appreciation of Greece's real exchange rate. The validation of a real appreciation of that magnitude has required a lot of government spending and such a fiscal stance was bound to prove unsustainable.
Greece is not the only European country in this pickle. Whether the Greek and European body politic can now weather the fiscal burdens of an adjustment without breaking the euro currency system, remains to be seen. (Written by Mr Peter Drysdale, Emeritus Professor. For CES).
In other words the crisis has nothing to do with the "lazy, corrupt" Greeks, the P.I.G.S. or any of the other nonsense that our media have tried over the years to manipulate the public opinion with. In fact we are not witnessing the interests of one country going against the other in this crisis, that has been admitted by many European leaders and top EU officials. What we have is the war of interests of the creditors and the investors in each country, that want to secure their investments and if possible make profit.
By influencing the public opinion of a country through its media, the creditors push their governments to adopt measures that will promote either protectionism of their own national social policies and resources, or undermining other nations'. And so we ended up with the Germans calling the Greeks lazy and incompetent and in return the Greeks calling the Germans Nazis, recalling past traumatic and unfortunate events in their history.
Greece is not the only problem in the euro-zone and not the biggest. To slander one nation in this way, is no better than what the Nazis did back with the Jews during WW2. Us Greeks are being used as the scapegoat of this crisis, by the European elites. They put the blame on us for their own mistaken policies, that allowed the weak spots of the euro-zone to be exposed and used by profit mongering corporations.
The only good that came out of this crisis is that the Greeks now, after decades of political idleness are re-evaluating their stance and personal involvement towards their country. They are debating on what kind of society they want to have in the future. They are becoming more active in the political life of Greece and are starting to have a vision for the future of their nation. It only remains to be seen if their leaders or the European elites are sharing their dreams and deliver this time.
Of course the downside effect of the crisis in Greece is similar to this of other countries. In Finland we had the rise of the True Finns party, in the recent on-going French election we saw the far right party of Marine Le Pen gaining almost one fifth of the votes. And in Greece we see a surge of nationalism, xenophobia and euro-skepticism, that will most certainly have an effect during the upcoming elections.
The Greek blog-sphere is rife with different scenarios and conspiracy theories, anti-EU/European and anti-euro sentiments, patriotic messages and potential solutions that somehow all involve or predict the collapse of the euro- even the EU; or simply Greece's exit. Some others' purpose is to simply inspire their fellow Greeks to be strong and proud; to reinstall some national pride anyway they think it is best.
An average European can relate to Greece now, because the crisis is not being seen as a Greek "sickness" anymore. All euro-zone member states have borrowed too much and contributed in the block's woes. Whatever happens now in Greece, Portugal and Ireland will most likely spread to other nations too. Our economies are so intertwined and exposed to each other, that will be impossible not too. We are seeing it already spreading to Spain, Italy, France, Belgium and Holland.
Our leaders are using austerity as the only solution to deal with the crisis. They want to reform the social structure of the continent in the future and life for a worker will be very different. Even if some countries escape this reality, they will have to keep contributing financially to support those countries who have to face tough austerity measures. In other words, they will have to keep bailing out the "peripheral" states.
It seems so that no one will escape the consequences. There is also the moral dimension of the issue, of the kind of "European solidarity" are we claiming to have, when we are allowing nationalism to pull down everything we have built during the past few decades. Do we want o reinstall the walls in Europe, turn against immigrants and each other, do we want to go back to a Europe of restrictions, divisions and fanaticism?
Just because our elites messed up, got too greedy and overconfident with the success of what they have created, it does not mean that we have to turn our backs completely to what we have and what we have achieved.
Time to give them a message, that we stand united and in solidarity with each other. We are all Greeks, we are all Irish, all Portuguese, French, Dutch, Spanish, Italians. We want the same, a stable prosperous future, equality, transparency, democracy and opportunities. It is time to be part of our country's and continent's political life and get involved.
If Europe's people/workers actually manage to pass this message on a united front, it will be difficult for our elites to ignore us. It is not about Greece anymore, but about Europe and the future of our continent. Will you leave the Greeks, the Portuguese and the Irish to stand alone? Show your solidarity now, because your country, your jobs and the future of your kids might be next.