Tackling the EU/Eurozone’s Assault on National Democracy

Where we are on the 40th anniversary of joining the EEC

The Political Basis of the EU:

All States and aspiring States have their myths of origin. The myth of origin of the EU is that it is a peace project to prevent wars between Germany and France – as if a tendency to go to war is somehow genetically inherited.

The actual facts are however that the first step towards supranational economic integration, the European Coal and Steel Community of 1951, was to facilitate German rearmament at the start of the Cold War with Russia and to reconcile France to that fact. The US wanted a rearmed West Germany inside NATO. This greatly alarmed France which had been occupied by Germany just a few years before.

Jean Monnet, who was America’s man in the affair, came up with the solution. To assuage France’s fears he drafted the Schuman Declaration proposing to put the coal and steel industries of France, Germany and Benelux under a supranational High Authority as “the first step in the federation of Europe”. A federation is a State, so the political aim of establishing a State or quasi-superstate under Franco-German hegemony has been there from the start. The EU celebrates 9 May, the date of this Declaration, as “Europe Day” each year. Monnet became secretary of the supranational High Authority, the predecessor of today’s Brussels Commission.

Thus historically the EU is in its origin an out-of-date legacy of the Cold War, pushed by the USA in the 1950s to provide an economic underpinning to NATO in Europe.

Simultaneously “Europeanism” became the creed of a legion of intellectuals across the continent, disillusioned by the failed ideologies of the 20th century. They provided ideological arguments in support of their assault on all things national. Their central assertion was that conflict between Europe’s States could be prevented by putting their national democracies under the control of a supranational high authority of non-elected technocrats – namely themselves or people like themselves – while trying to merge their peoples in a kind of jellybowl of nations.

They developed the doctrine that by “pooling” sovereignty small States increase their influence over bigger ones, whereas in practical reality it is the other way round. Classically, the concept of sovereignty means that a State is the sole author of the laws prevailing in its territory. For EU members however most laws now come from Brussels. Talk of pooling sovereignty is like referring to a woman as being half-pregnant. Sovereignty “pooled” is sovereignty surrendered.

Forty years after the 1951 Coal and Steel Community, and the 1957 Treaty of Rome setting up the European Economic Community(EEC) which followed, another shift in Franco-German power, Germany’s reunification as a side-effect of the collapse of the USSR in 1991, led these two countries to establish the European Economic and Monetary Union (EMU) and its single currency, the euro.

The big increase in Germany’s population and territory on reunification greatly alarmed France. However France had nuclear weapons, which Germany was precluded from having under the post-War treaties. The deal between the two of them was EU Monetary Union for Political Union or, put crudely, the Deutschemark for the Euro-bomb. Germany would give up its national currency, the symbol of its post-war economic achievement, and share the running of a new supranational EU currency with France, while France agreed to work jointly with Germany towards a supranational EU political union with its own common foreign, security and defence policy.

This would give Germany a central role in running a potential EU world power, with its finger on a nuclear trigger in due time. France in turn hoped the euro would give it a political lock on Germany. “The two pillars of the Nation State are the sword and the currency and we have changed that,” exulted EU Commission President Romano Prodi. A Franco-German army brigade with joint officers and a joint command was simultaneously set up as a symbol and prototype of the EU army of the future. Belgium, Luxembourg and Spain have since joined this as contributors to a common “Eurocorps”.

France and Germany are said to share a common interest in being joint engines of the EU integration project. The conventional wisdom has been that if they stay together they can push through the Brussels institutions whatever policy suits their interests, while between them they are strong enough to prevent any other group of EU States from adopting policies they do not like. The reality is somewhat different however, as Germany was always going to be the big winner in moves towards an EU monetary and political union.

The Intoxication of Big Powerdom: Tuilleadh

The Crisis of the Euro: “Apart from that, Mrs Lincoln, did you enjoy the play?”

“The member states whose currency is the euro may establish a stability mechanism to be activated if indispensable to safeguard the stability of the euro area as a whole. The granting of any required financial assistance under the mechanism will be made subject to strict conditionality.”
– Amendment to Article 136 of the EU Treaties (TFEU) which was decided on by the 27 EU Member States at the March European Council summit and which licensed the 17 Eurozone States to sign the European Stability Mechanism Treaty on yesterday week, 11 July.
This ESM Treaty would establish a permanent EU bailout fund from 2013. The ESM Treaty and the Art.136 EU Treaty amendment which authorises it now go around for ratification by the Member States. The Government has decided not to put it to referendum here even though it means more power to the EU. The ESM Treaty can be downloaded from the internet.

The Irish Coalition Government, supported by Fianna Fail, intends in the autumn to get the Oireachtas to approve the decision to make the above amendment to the EU Treaties and then to ratify the consequential ESM Treaty for the 17 Eurozone countries.

They do not intend to hold a constitutional referendum, even though the wording of the Art.136 TFEU amendment and the ESM Treaty that derives from it would formally subordinate Ireland’s interests to those of “the stability of the euro area as a whole” … Even though there are no Treaty limits laid down as regards the “strict conditionality” which can be imposed on recipients of financial bailouts from the permanent ESM Fund envisaged … And even though Ireland will be required to contribute some €11 billion in paid-up and callable capital and guarantees once this Fund is set up in 2013.

The Irish Government thereby hopes to circumvent the 1987 Crotty judgement of the Supreme Court that new EU Treaties which extend the scope and powers of the EU and entail further surrenders of Irish sovereignty to Brussels/Frankfort, can only be made if the Irish people agree to them in a constitutional referendum. It is only the sovereign people themselves can decide on further significant surrenders of sovereignty to the EU – not our politicians or our TDs and Senators.

On 12 July Irish Finance Minister Michael Noonan said on RTE that were it not for Spain and Italy he would have been “euphoric” about what happened at the meeting of EU Finance Ministers the day before, when they spoke about the possibility of lowering the penal 6% interest rate being charged for the giant EU/IMF loan that was pushed on Dublin last November.

That was a bit like saying “Apart from that, Mrs Lincoln, did you enjoy the play?” The reason Minister Noonan was (almost) euphoric was because (as he said) the euro crisis is no longer about Ireland, Greece or Portugal but about core Europe.

The ultra-Europhiles in Ireland’s Establishment do not care what happens to Ireland, the euro or the EU, as long as they are not blamed.

The lack of self-confidence on the part of Ireland’s “Federalistas” is astonishing.

The powers-that-be bang on about the loss of Irish “economic sovereignty”, but they all want to have the euro debt federalized so that they can brandish an interest rate reduction on the current EU/IMF loan as a superlative political achievement.

Federalizing the debt means the end of the State’s 12.5% Corporation Profits Tax, which is crucial for attracting foreign investment in the Irish economy, and a lot more besides, as Berlin takes over permanently Ireland’s detailed budget decision-taking under the permanent EMS Treaty.

The Irish State is caught between a rock and a hard place, so far as Ireland’s “Federalistas” are concerned. It is bye-bye euro or bye-bye to what is left of Irish sovereignty.

On 16 July the Irish Times called for an EU fiscal and political union in its lead editorial. “This has always been the project’s ultimate end-point,” it stated.

But there was no mention of that being the “ultimate end-point” as Ireland’s paper of record championed passionately and uncritically every step of EU integration down the decades.

What a catastrophe the Eurofanaticism of Ireland’s “Federalistas” has brought down upon the Irish people:

* Pushing us in 1999 to join a monetary union with an area with which we did only one-third of our trade…

* Leading us to adopt totally unsuitable low interest rates in the early 2000s because these suited Germany at the time, so making our “Celtic Tiger” boom “boomier”, as Bertie Ahern put it, and inflating the property bubble…

* And since 2008 turning us into debt peons of the European Central Bank, whose Jean-Claude Trichet told Messrs Cowen and Lenihan at the time of the infamous blanket bank guarantee of 29 September 2008 that Anglo-Irish Bank must on no account be let go bust and that the foreign creditors/bondholders of the Irish banks must be paid every cent in full.

Which EU country had the highest economic growth rate last year? It was Sweden, at 5.5% . . . In the EU but happily outside the Eurozone. Its people sensibly rejected Eurozone membership in 2003 in a referendum vote of 56% to 44%, even though most of that country’s politicians supported abolishing the Swedish kroner at the time.

Angela Merkel now has to find a way of telling her own people that Germany is about to achieve the ambitions for which they fought and lost two World Wars, but that it will cost them money.

She also has to find a way of saying that without the rest of us noticing! And the other Heads of Government have to find a way of telling their electorates that the price of a continuing Eurozone of 17 is permanent German hegemony plus an austerity economic regime with all that that entails.

The only longterm solution of the current crisis is either federalizing the euro sovereign debt or the break-up of the Eurozone of 17. There are now likely to be moves to try to federalize some of the debts. There will be developments pointing to Trichet’s hoped-for EU Finance Ministry and much else besides, but one wishes that the proponents of the EU developing into a United States of Europe would ask themselves what happens after that. Such a logical end-point of the “great EU integration project” would not be the end of European history.

* Do the Euro-federalists really think that the many peoples of the EU would submit to effective German-French economic rule for the indefinite future?

* Do they really believe that they can institute a European democracy without a European “demos”? …

* Or that the latter can somehow be artificially created? …

* Or that people will submit indefinitely to administration by Brussels-Frankfurt technocrats, fronting for Berlin, no matter how benevolent these regard their own intentions?

These quite unrealistic assumptions have been subscribed to by the EU integrationists from the start. These people are now being exposed for the arrogant blunderers and fantasists they are, but millions are suffering terribly, and will suffer further, as they seek to impose ever more austerity on the PIIGS countries in the hope of saving their grand euro-currency “project”.

History has many examples of failed currency unions even though they were also fiscal and political unions.

The Irish State left the British monetary union after a century of membership. An independent Irish currency was seen by successive generations of Irish nationalists as an indispensable part of an independent Irish State.

Where now is the USSR rouble, the Yugoslav dinar, the Czechoslovak crown or the Austro-Hungarian thaler – all currencies of multinational federations that were monetary, fiscal and political unions for three-quarters of a century or longer, and all now vanished into history along with their creators?

Europe is a Europe of the Nations and the States or it is nothing, as Charles De Gaulle once said. That statement of democratic principle of course is internationalism, not nationalism. We need to adopt it as part of the ABC of political realism in face of the current crisis.

Democrats need to work towards a Europe of independent democratic cooperating Nation States, and abandon the fantasy of turning the EU into a world power under effective Franco-German hegemony, with the elites of small countries like Ireland serving as their well-paid local acolytes.

Anthony Coughlan Director The National Platform EU Research and Information Centre

Sunday Independent: Interview of Pat Cox was ‘one-sided’ and ‘unfair’ – BAI upholds complaint made against ‘Marian Finucane Show’

From the Sunday Independent – Interview of Pat Cox was ‘one-sided’ and ‘unfair’:

An interview conducted by the RTE broadcaster, Marian Finucane, with the aspirant Fine Gael presidential candidate Pat Cox, during which he gave a “partisan and patronising lecture to the nation”, has been found to be unfair, partial and lacking in objectivity.

Yesterday the anti-EU campaigner who brought the complaint to the Broadcasting Authority of Ireland (BAI) said he was “rather surprised” by the ruling in his favour.

He said he had expected it to be rejected “especially as it involved such a well-known ultra-europhile as Mr Cox, who is now seeking the Fine Gael nomination for the Presidency”.

Anthony Coughlan told the Sunday Independent that he happened to hear accidentally Mr Cox’s “lengthy exposition of the background to our current troubles” on Saturday, April 2.

He described it as “extraordinarily unctuous, patronising, unbalanced and designed above all to deflect criticisms away from EU institutions, and particularly the European Central Bank”.

The BAI ruled that the broadcast treatment of a “major issue of public concern and consequence” resulted in one view being given prominence without ensuring the alternative viewpoints were fairly represented.

Read more.

Citizens’ Demonstration outside the Dáil on Monday, “Europe Day”, 9 May, from 12.30 to 2:00, against the farce within

JOIN THE DEMONSTRATION  AGAINST THE  “EU RE-DEDICATION RITES” OUTSIDE THE DÁIL,  MONDAY  9 MAY, FROM 12.30 TO 2:00PM

Ireland’s Euro-fanatics and ultra-Europhiles are getting panicky.

As the European Central Bank turns us all into indentured debt peons for a generation and France and Germany plan assaults on our 12.5% company tax rate, they fear that Ireland’s long love-affair with the EU may be coming to an end.

Hence the ceremony of re-dedication planned for the Dáil this Monday, “Europe Day”, 9 May.

It is meant as an opportunity for the political  leaders of  the Euro-faithful to renew their vows.

Lucinda Creighton, Dick Roche’s successor as Minister for Europe, is the occasion’s impresario.

Ireland’s Commissar, the exorbitantly-paid Fianna Fail appointee Maire Geoghegan-Quinn, will address the Dáil.

The State’s 12 MEPs will attend so that TDs can ask them questions. Let us hope that at least some TDs will have good questions ready on the power-grabbing, expenses-fiddling and corruption of the European Parliament.

This special Dáil session will undoubtedly see much cant about “the European ideal”,  “our European partners” etc. in the hope of impressing the continentals. But they just want our money these days, as Irish taxpayers are mulcted under the aegis of the ECB to meet the bad debts of German and French private banks.

The reason 9 May is “Europe Day” is to commemorate French Foreign Minister Robert Schuman’s launch of the European Coal and Steel Community on 9 May 1950. The “Schuman Declaration” which he issued that day spoke frankly of the establishment of this first supranational European community as “a first step in the federation of Europe” – a federation being of course a State. That is what makes this statement and this day so important for the Euro-federalists.

Irish people have been lied to time and time again to conceal the fact of a federal-style quasi-Superstate under Franco-German hegemony being the ultimate political purpose of the EU.  For decades they have been sold the falsehood that the EU is just about jobs and growth, and not a political/fiscal union.  Remember the “Vote Yes for Jobs” slogan of the Yes-side groups in the second Lisbon Treaty referendum?

The “myth of origin” of the EU/EC is that it is essentially  a “peace project” to end wars between France and Germany. This is quite unhistorical. The truth is that the 1950 Coal and Steel Community was thought up to reconcile France to German rearmament in the newly founded NATO – a key aim of American policy at the start of the Cold War. The French were alarmed at the thought of Germany being rearmed just six years after the Germans occupied France.  Jean Monnet, who authored Schuman’s declaration, was America’s man in the affair. The Americans backed strongly the Monnet/Schuman proposal to put the coal and steel industries of France, Germany and the Benelux  countries under a common supranational High Authority, of which Monnet was made first Secretary-General. This was the predecessor of the later Brussels Commission. This step quelled French anxieties at the time. In those days European integration was US Government policy, and it  is well-known that the CIA financed the European Movement throughout the 1950s and 1960s and perhaps later to push that objective.

CITIZENS’ DEMONSTRATION: There will be a non-party Citizens’ Demonstration against this Europe Day farce outside the Dáil in Kildare Street  from 12.30 to 2.00 pm. on Monday, 9 May.

PEOPLE ARE INVITED TO BRING A POSTER WITH THEM, WITH AN APPROPRIATE MESSAGE, but no party banners: for example  “EU/ECB Rule: Death of Irish Democracy”,  “Ireland Yes, EU/ECB No”, “Europe Day Dail Farce”, or some variant of these.

AND PLEASE PASS ON THIS MESSAGE TO OTHERS.

(Signed) Anthony Coughlan
Director
The National Platform EU Research and Information Centre
24 Crawford Avenue
Dublin 9
Tel.: 01-8305792

Ireland after it’s 2011 General Election

Statement from the National Platform EU Research and Information Centre, March 2011

1. FIANNA FÁIL DOWN, FINE GAEL AND LABOUR STILL TO GO

One big party – Fianna Fáil –  that supported Ireland’s blanket Bank bailout, the EU/IMF stitch-up last December,  the 2009 Lisbon Treaty, the 1992 Maastricht Treaty which abolished the Irish púnt,  and every other step towards EU-integration over decades, bit  the dust in the February General Election. We must now wait some time to see the two other big parties that did exactly the same thing, namely Fine Gael and Labour, bite the dust also as they impose on us the savage rigours of the EU-IMF deal over the next few years.  This should open the way for the new political forces that were reflected in the success of the Independent TDs, the trebling  of Sinn Féin’s Dáil representation and the advent of the United Left Alliance, to become the genuine opposition force in Irish politics that is so obviously needed

2. IRISH LABOUR AS THE MUDGUARD OF FINE GAEL

If the Labour Party were really to act in the “national interest” which it prates so much about and in accordance with the programme it sought the votes of the people on, its leaders would let Fine Gael form a government on its own, with Fianna Fail and other support from outside.  Fianna Fail would not dare to vote against a Fine Gael minority government for several years, so that such a government would be quite stable.   Instead, as Sean O’Casey said of Labour at the time of the first Fine Gael-Labour Coalition of 1948-51: “Their posteriors are aching for the velvet seats of office.” Instead of Labour being the largest element in opposing the Fine Gael/Fianna Fail implementation of the EU/IMF stitch-up, Messrs Gilmore, Rabbitte, Quin and Howlin and Joan Burton have assumed Irish Labour’s traditional role of “mudguard of Fine Gael rather than advance-guard of the workingclass”!  It used be said that Labour struggles with its conscience, and Labour always wins. . . Except that on this occasion a handful of ageing Labour leaders were so desperate to get into office for their own benefit that there was not even the pretence of such a struggle.

Since 1948 Labour’s role in Irish politics has been periodically to revive Fine Gael from near terminal decline by putting it into office, simultaneously enabling Fianna Fail with virtually identical policies to revive itself in opposition. Thus the Irish Establishment could afford the luxury of having two big parties to champion its interests rather than one. Labour Ministers got big jobs, good salaries and pensions for their services, while the Labour Party was decimated in the subsequent election. This has happened on four occasions since 1951. The difference on this occasion is that Fianna Fail’s electoral defeat has been so great that it may not be able to recover in opposition. There is no real objective social basis for its continuance as a political party, now that the impact of the financial crisis and the huge increase in its vote has enabled Fine Gael to morph into becoming Ireland’s “natural” conservative party.

Whether this will actually happen depends on the non-Fianna Fail forces on the Opposition benches working together in the period ahead to make themselves into a cohesive, credible and radical opposition, cooperating  with one another at least on fundamentals.  It is inevitable that there will be a major reaction against Fine Gael and its Labour junior partner in the next general election, as they spend years as the local administrators of German-sponsored EU-IMF austerity.  The next election may also come about much sooner than five years because of the continuing national and international financial crisis.

3. THE EUROZONE FRAMEWORK OF IRELAND’S ECONOMIC CRISIS

The Irish State’s economic crisis stems fundamentally from its folly in joining the Eurozone in the first place in 1999, impelled by the longstanding uncritical Europhilia of the Fianna Fail, Fine Gael and Labour parties and others. By abolishing the national currency at that time, Ireland adopted the currency of an area with which it did only one-third of its trade (i.e. exports and imports combined).  Another third of its trade was with the UK and the other third with the USA and the rest of the world.  Last year two-thirds of the Irish State’s foreign trade was still outside the Eurozone!  Moreover, joining the Eurozone led Ireland to adopt negative real interest rates at the height of the “Celtic Tiger” boom and thereby inflated the property bubble which has now burst, leaving both  the State and its State-guaranteed banks objectively insolvent.

The 10 EU Member States outside the Eurozone  – Denmark, Sweden, Britain, Poland, the Czech Republic etc.- have nothing like the Irish State’s problems. These EU Member States are thanking their stars these days that they avoided the course of folly that Ireland’s political elite pushed its people on to. A little thought will show one that abolishing the púnt was by far the worst decision ever taken by an Irish Government. It was far worse than the 2008 blanket Bank guarantee by Taoiseach Cowen and Finance Minister Lenihan, for if the Republic had not joined the Eurozone in the first place, there would have been no need for that guarantee.  It was the European Central Bank which insisted that it be given:  namely, that no Irish bank must be allowed to fail in case the German-French banks from which the Irish banks had borrowed, would not be paid back.

If we had stayed outside the Eurozone there would have been no ECB to bother us.  The Eurofanaticism which led Fianna Fáil, Fine Gael and Labour to push through the Maastricht Treaty and push us into the Eurozone initially has been the most outstanding historical delinquency of Ireland’s political Establishment. Yet deference to the EU is so ingrained in 26-County official and media opinion that many who should know better are too timid even today to recognize and draw attention to these obvious points.

There are calls for a public enquiry into the infamous blanket bank guarantee of September 2008 and why it was continued last September. More relevant and useful would be an enquiry into the folly that led the Irish State to join the Eurozone in the first place, from which the financial collapse and the bank guarantee have both stemmed.

4. SACRIFICING IRELAND’S CHILDREN TO HOLD THE EUROZONE TOGETHER : THE 24 MARCH EUROPEAN COUNCIL MEETING

We are now trapped like rats inside the Eurozone, although it is only a matter of time before the Eurozone breaks up and some or all of its Member States leave it and reestablish their national currencies, for its structural faults are irremediable.  The only question is how soon will this occur and in what circumstances – whether it will be done in an organised or disorganized fashion.  In the meantime Germany, with France holding on to its coat-tails, plans for Ireland and the other peripheral Eurozone countries a punishing regime of austerity and national asset sales that could go on for years.

On 24 March the European Council meeting of EU Prime Ministers and Presidents is expected to agree an amendment to the Lisbon Treaty to set up a permanent EU bailout fund from 2013 – the European Financial Stability Mechanism. Ireland will be expected to contribute to this, but it will not have retrospective effect or alleviate the pain for the Irish people of last December’s EU-IMF stitch-up.  The EU authorities are very anxious to avoid a referendum in any EU State on the establishment of this Fund even though it will entail an amendment to the EU Treaties. The EU Summit meeting will seek to push through this amendment by using the “self-amending provision” of the Lisbon Treaty (Article 48 TEU). Messrs Kenny and Gilmore will be under pressure to push it through in Ireland without a constitutional referendum on the grounds that it is only a minor technical change and does not increase the powers of the EU.
The Opposition TDs in Leinster House will need to consider a Court challenge to this likely course, if the incoming Government seeks to follow Fianna Fail’s policy of denying the Irish people a referendum on this EU Treaty change.  At the same time there is likely to be an attack on Ireland’s 12.5% Corporation Profits Tax rate and a scheme for a common cross-EU Tax Base which would fundamentally subvert Ireland’s attractiveness for foreign investors. The Common Tax Base idea, which the Brussels Commission is proposing, is a scheme for so-called “destination taxes”.  It envisages Corporation Tax being calculated centrally at EU level so that firms pay profits tax to the governments of the different countries in which they sell their goods, and not to the Government of the country where those goods are originally made.

The new Irish Government needs to coordinate its responses to the crisis with the governments of the other so-called PIIGS countries in the Eurozone – Portugal, Italy, Greece and Spain – and resist the Franco-German dictation now taking place. This depends on Messrs Kenny and Gilmore overcoming the  decades-old habits of Irish deference and political kow-towing to the EU and our EU “partners”. It needs them to  show some political backbone and willingness to stand up for Irish interests.  Up to now Irish policy is to keep as far apart from the other PIIGS countries as possible. This is in line with the Iveagh House people’s policy of always seeing Ireland as being the “good boy” in the EU class, happy as long as it receives pats on the head for good behaviour from Franco-Germany!

5. HOLDING THE ECB TO RANSOM

The ECB has lent the Irish Banks some €150 billion. If the Irish banks all closed tomorrow morning, the ECB would not get its €150 billion back because that money is now in the system in Ireland. The ECB knows that Ireland’s banks have not got the money to pay it this vast sum. From the ECB’s point of view its best plan to recover the money it advanced to cover the reckless lending of the banks is to shift the burden of repayment on to the Irish taxpayers. Therefore the political and media suggestion that the ECB will close down the ATM machines so there will be no money in the system, is so much scaremongering to intimidate the public into agreeing to take on these debts it is not responsible for. The central issue at present is that the ECB wants the Irish State and taxpayers to take on the burden of paying this €150 billion back to the ECB as rapidly as possible, so that instead of the Irish Banks owing the ECB this vast sum of money, the Irish State/taxpayers will do so and will pay it back over years by flogging off the Banks themselves to foreign owners, selling off the NAMA loans at knockdown prices, privatizing State assets systematically and screwing Irish taxpayers for this purpose.

This is essentially what the EU/IMF Memorandum of Understanding commits the Irish Government to doing.  The Irish public needs to be warned that what its political leaders are planning is a massive fire-sale to foreigners of the recapitalized Irish Banks and State assets generally – the NAMA loans, Coillte, An Post, the ESB, Bord Gais etc. and Ireland’s natural resources, so that we can pay back the money the ECB is putting in  the Irish Banks, essentially in order to ensure that private banks in Germany, France and Britain do not suffer losses on their Irish operations. Until this fire-sale is completed, the ECB depends on us and we can in effect hold it to ransom.  Hence the new Irish Government should be in no hurry to comply with the ECB’s wishes.  It should act in accordance with the old truism: If you owe the Bank a million you are in trouble, but if you owe it a hundred million it is the Bank that is in trouble!  The ECB stood irresponsibly by while the German, French and British banks punted huge sums on the Irish property market for years and made big profits thereby.  As the Eurozone’s lender of last resort the ECB should now pick up the tab.  The Irish State needs to repudiate the horrendous private Bank debts that it has so foolishly guaranteed, if it is to be able to repay its legitimate sovereign debts and return to the international bond markets at an early date in order to borrow at reasonable interest rates.

6.  MONETARY UNIONS, FISCAL UNIONS, POLITICAL UNIONS

One cannot have an independent State unless it has its own currency, and with that control of either its interest rate or exchange rate policy, for these are fundamental  economic instruments for advancing a people’s welfare.  Those who fought for an Irish Republic historically took for granted that national independence meant that an Irish State would have its own currency and the related economic instruments.  The rate of interest is the internal  “price” of money, so to speak, and the currency exchange rate is its external “price”. A Government cannot control either unless it has a currency of its own in the first place.  That is why former EU Commission President Romano Prodi exulted when the Monetary Union was set up for a minority of EU States in 1999: “The two pillars of the Nation State are the sword and the currency and we have changed that.”

The fundamental problem for the Eurozone and its 17 Governments is that there cannot be a stable, lasting monetary union that is not also a tax and public spending union, and hence a Political Union, so that its component Member States are compensated for loss of their  ability to influence their competitiveness by varying their exchange rate – for they have no independent currencies any longer – by automatic  transfers from richer to poorer States through a common federal-style Eurozone tax and public service system. The latter means a Political Union like the USA, and the dream of building a United States of Europe on similar lines to the US has for decades been a dream/fantasy of the Euro-federalists, of whom there are many in the leadership of the Fine Gael and Labour parties.

A system of common taxes and public services exists within national States, but it does not exist cross-nationally.  It cannot exist cross-nationally because the social solidarity, the sense of community and mutual identification, the sense of being a common political “We”, which is what makes people pay taxes freely and willingly to a common Government because it is “their” Government, does not exist at EU level.  A democracy or democratic State is impossible without a “demos”, a people; and there is no EU or Eurozone “demos”, in contrast to its component Nation States.

This is the fundamental fallacy of the EU integration project, the attempt to turn the EU into a quasi-State, even though already half or more of the legal acts made in each of the 27 EU Member States each year are on average of EU origin. Free trade is one thing, and is normally a good thing.  A common currency, credit and exchange rate policy for very different economies is something totally different. The resistance of German public opinion to financing Greece, Ireland, Portugal etc. in the current  Eurozone crisis is but one small example of this. The solidarity needed for such continual resource transfers between the Member States of the Eurozone to enable it hold together does not and cannot exist. Nor can it be artificially created.

7. REESTABLISHING IRELAND’S NATIONAL CURRENCY

The advantage of a country having its own currency is that it enables its Government either to control credit and issue money for purposes of job-stimulus and the like through varying the rate of interest, or to influence its competitiveness with other economies by varying its exchange rate. Governments can set a target for either the interest rate or the exchange rate, but they cannot achieve both targets simultaneously, for each rate affects the other.

In the Eurozone interest rate and exchange rate policy are quite properly decided in the interests of the Big States, for they contain most of the population of the Eurozone. The one-size-fits-all interest rate regime of the European Central Bank (ECB) must always be unsuitable for some Eurozone countries therefore, for the 17 economies concerned differ widely.  Moreover, as the Irish State does nearly two-thirds of its trade outside the Eurozone, whereas all of the 16 other Eurozone members do half or more of their trade with one another, the exchange rate for the euro must normally be unsuitable for Ireland also. This is vividly shown these days as the euro rises vis-a-vis the dollar and pound sterling. This hits Irish exports to the dollar/sterling areas where we do most of our trade and encourages competing imports from those areas.
Having taken the disastrous step of joining the Eurozone in the first place, it would be foolish to pretend that one can get out of it without pain, especially when Irish Governments have agreed to stand over the mess in the State’s private banks and have built up such a deficit in the State’s public finances. However, re-establishing an independent Irish currency and with that its own credit and exchange rate policy has to be a central objective of all genuine Irish democrats, for without that there can be no truly independent Irish State. People should not be afraid to state this, especially as the pain of remaining in the Eurozone is mounting all the time and the historical trends point to continual strains within it and continual crisis as long as it lasts, and its eventual partial or total dissolution is inevitable.

The threat of repudiating the private bank debt now moved to the ECB  and of reestablishing the Irish pound is the principal lever/weapon the Irish State has vis-à-vis the Eurozone. At present Ireland cannot restore its economic competitiveness by devaluing its currency. It can only become more competitive by “devaluing” – that is, by  cutting –  peoples’ pay, profits and pensions instead for years to come.  The main advantage of leaving the Eurozone and rejoining the 10 EU Member States outside it is that it would enable the Ireland to resume control of its money supply and credit and thereby stimulate domestic demand and employment, while simultaneously it could boost the State’s economic competitiveness by devaluing the exchange rate. The main drawback of this step is that much of the State’s foreign debts would be in euros, if the Eurozone still existed, and would be expensive to pay off in a depreciating currency. On the other hand, the boost to competitiveness and exports arising from having a more suitable exchange rate than the Eurozone one, should enable Ireland earn more foreign currency with which to pay those debts. Temporary exchange controls would also be needed for a transitional period. It is in any case likely that some countries will leave the Eurozone in the next few years, if the Eurozone as a whole succeeds in holding together at all.

If the Eurozone breaks up, a planned dissolution and a related reapportionment of debts would clearly be better than a disorganized one.  There are many examples of monetary unions that have dissolved and been replaced by national currencies. The Irish State itself left the UK monetary union in 1921, although it maintained an overvalued púnt at par with sterling until 1979.  The USSR rouble was replaced in short order by 15 successor currencies in its 15 successor States in 1991. The Czechoslovak crown and Yugoslav dinar were replaced by successor currencies in the 1990s.  In 1919 the Austro-Hungarian thaler was replaced by the different currencies of its several successor States.

What is happening now is that Ireland, Greece, Portugal etc. and the interests of their peoples are being sacrificed in order to save the Eurozone, whose dissolution would be a blow to the entire integration project of building a European quasi-superstate under Franco-German hegemony to become a big power in the world.  The acolytes of that project in Ireland  – in the leadership of the Fianna Fail, Fine Gael and Labour parties, in Foreign Affairs at Iveagh House, the Dept.of Finance and the Taoiseach’s Department, in the Central Bank, the Irish Times, RTE and the senior echelons of the Irish Congress of Trade Unions  – are desperately afraid that their political life’s work may have been in vain, so  they are quite willing that the welfare of the Irish people be sacrificed to save it. These are perhaps the most fundamental issues that are at stake in the current crisis.

People should remember also that the only period in the 90-years’ history of the Irish State when it used its monetary independence, followed an independent exchange rate policy and effectively floated the currency, from 1993 to 1999, gave us the “Celtic Tiger” rates of economic growth of 8% a year – until that was destroyed by the low-interest-rate-induced bubble of the Eurozone from 2000 onward.

Irish Times: Dominating Role of Larger EU States

The Irish Times – Friday, March 4, 2011 (letters)

Madam, – Dr Garret FitzGerald (Opinion, February 12th) shows concern that moving away from the so-called “community method” of making EU laws towards a more “inter-governmental” approach may open the way to an EU that “for the first time becomes dominated by some larger states”.

This looks like trying to lock the proverbial stable door after the horse inside has bolted.

For decades Dr FitzGerald and those who share his views on the EU have been advancing the quite unrealistic notion that the EU is a radically new form of political life and governance in which the big European states are willing to subordinate their national interests to a larger common EU interest and that it therefore makes sense for smaller states to “pool sovereignty” with them.

In historical reality the EU since its inception has been an arena for the pursuit of the national interests of its member states, above all its bigger ones, France and Germany especially. The big states use the EU to try to dominate the smaller ones if it suits them. If not, they will go outside it or beyond it. Three developments in the past 20 years show this strikingly.

The first was the establishment of the euro currency under the 1992 Maastricht Treaty. The core objective of that was to reconcile France to Germany’s sudden reunification in 1990, using economic means that were quite inappropriate for that purpose.

The current financial crisis shows the euro currency’s structural flaws. It has fundamentally divided the EU between the 17 EU states inside the euro zone that are now suffering the euro’s torments, and the 10 EU states outside it that are not.

The second was the 2001 Nice Treaty which allows an inner group of nine or more EU states to integrate further among themselves and to use the EU institutions to do that, even though the other EU members are opposed. This was a fundamental break with the notion of the EU as a partnership of equals in which no major step would be taken without unanimity. It enables the big states to present the others with unpleasant faits-accomplis. For example it would enable the 17 euro zone members, or a sub-set of them, to adopt a common tax base for assessing corporation profits tax, or a common tax rate if they wish, as could well happen in the coming period.

The third was the Lisbon Treaty of 2009. In power-political terms this treaty’s most important provision is that it puts EU law-making on a primarily population-size basis for the first time – from 2014. This means that in three years’ time Germany’s voting weight in making EU laws on the EU Council of Ministers will be doubled from its present 8 per cent to 17 per cent, France’s, Italy’s and Britain’s vote will go from their present 8 per cent each to 12 per cent each, while Ireland’s will fall from its present 2 per cent to 0.8 per cent. Is not this by any standard a power-grab by the big states?

For decades Irish policy-makers have used rhetoric about “the European ideal”, “our EU partners” and “an EU community of equals” to justify handing over ever-greater tranches of State power and law-making to the EU. A more hard-headed and less self-deluding approach will surely be needed by future Irish governments if we are to get out of our present mess. – Yours, etc,

ANTHONY COUGHLAN,
Director,
The National Platform EU Research and Information Centre,
Crawford Avenue, Dublin 9.
 

News Updates: Irish Parliament Abdicates Legislation, Who are the Bond-Holders? EU Propaganda Junkets

Open Europe
Press Summary Archive
11 October 2010
http://www.openeurope.org.uk/media-centre/summary.aspx?id=1204

The Irish edition of the Sunday Times reported that Edmund Honohan, Master of the Irish High Court, has accused the Irish Parliament of failing to assert Irish legislation over new laws from Brussels and delegating much of the workload involved in scrutinising EU law to civil servants.


http://www.swp.ie/editorial/who-are-bond-holders/3669
Who are the Bond-holders?
SWP / Kieran Allen, 08/10/2010

‘We must re-assure the bondholders about the economy’. This line is trotted out daily in the Irish media. But who are these bondholders? The strange feature of current debates is that the Irish people never get told to whom we are supposed to pay all these debts […]

Last Saturday the Financial Times published data on bondholders for Irish government debt. The figures relate to July 2010 when European banks were asked to provide information to the Committee of European Banking Supervisors as part of a stress test. Although the data is a few months old, we may reasonably assume that the pattern has not changed when interest rates shot up to 6.5%. It should be noted that the figures below pertain only to Irish state debt. We still do not know who the bondholders of Anglo-Irish or the wider banking system because this is supposed to be ‘commercially secret’ information. Read it carefully and you will get an insight into the shocking skulduggery that is going on here.

TOP 10 BANKS WHO HOLD IRISH GOVERNMENT BONDS

    1. Royal bank of Scotland £4.3 billion
    2. Allied Irish banks €4.1 billion
    3. Bank of Ireland €1.2 billion
    4. Credit Agricole €929 million
    5. HSBC $816 million
    6. Danske Bank €655 million
    7. BNP Paribas €571 million
    8. Groupe BPCE €491 million
    9. Societe Generale €453 million
    10. Banco BP1 €408 million

The Royal Bank of Scotland is owned by the British government and Peter Sutherland was one of its directors until 2009. Sutherland often lectures the Irish population on the need for cutbacks – but he never reveals this link. The big surprise, however, is that the two biggest bondholders are Irish Banks. The people of Ireland have already put €7 billion in these two banks – but they then screw us twice by lending back our own money at higher interest rates. Imagine working class taxpayers delivering billions at the front door of the bank and then the directors scurrying around the back door to lend us back our own money and to call for more sacrifices. It is time to end this madness now.


http://synonblog.dailymail.co.uk/2010/10/is-this-how-the-eu-got-a-yes-to-lisbon-from-the-irish.html
Is this how the EU got a Yes to Lisbon from the Irish?
Daily Mail Ireland Online / Mary Ellen Synon, 7 October 2010

The European Commission has just flown 15 Irish journalists to Brussels for a two-day ‘information visit’. Or as those of us who know Brussels and talk straight would put it, for a two-day, two-night taxpayer-funded propaganda junket at a four-star hotel.

Ireland and the other eurozone countries might be suffering savage spending cuts, but the EU self-publicity budget thrives: in 2008 the Open Europe think-tank calculated that the EU was spending at least €2 billion a year on ‘information’.

Much of it bent, which is to say, propaganda. The commission actually admits that its information is bent. One of its publications declares: ‘Genuine communication by the European Union cannot be reduced to the mere provision of information.’

The EU propaganda machine pumps money into lobby groups that support ‘ever closer union’. They push propaganda into schools. And almost more than anything else, they target the Press. Journalists are offered ‘free’ trips and training (yes, just like Scientology offers training). The EU gives out cash prizes to on-message journalists.

A parliamentary Press official told me this week that a large number of Irish news organisations are given free flights to Strasbourg to cover the parliament, plus €360 in cash for expenses. (The Irish Daily Mail takes none of these taxpayer-funded handouts.)

 

[…]I got myself into the middle of it to hear what it was the commission and parliament propaganda machine would say to these 15 EU-innocents coming from Dublin. I cut the hotel and the other freebies – I live in Brussels – and stuck to the meetings. Meanwhile the journalists piled off their EU taxpayer-funded €377-a-head flight and into their EU taxpayer-funded rooms at the Hotel Manos Stephanie (’the Louis XV furniture, marble lobby and plentiful antiques set a standard of elegance rarely encountered,’ the hotel brags, and so it should since the rate is listed at €295 a night for a single room).

I said ‘No, thanks’ to the swish free lunch (well, not free to the taxpayers: it cost taxpayers €30 for each journo) in the private dining room at the European Parliament on Tuesday. It wasn’t hard to say No. The truth is I get gag-reflex when someone offers me taxpayer-funded food. I can never get that line from Abraham Lincoln out of my head, about the lure of ‘the same old serpent that says you work and I eat’.

I only wanted to be there to see how the propaganda machine would seek to mislead. For example: one theme that turned up in briefings on the economy was that the euro had nothing to do with Ireland’s economic disaster, nor indeed with any economic disaster anywhere in Europe.

Yet it was the low interest rates of the early years of the euro that set fire to our property bubble. It was the illusion of eurozone convergence that allowed our banks to suck in billions from saver-countries such as Germany.

The propaganda orthodoxy in the EU will admit no such damage. What the Irish journalists were given this week was the Bart Simpson excuse for the damage done by the euro: ‘I didn’t do it. Nobody saw me.’ This wasn’t information, it was a propaganda pitch.

[…] One of the meetings the Press officers had arranged was a session with five Irish members of the European Parliament.
[…] I thought I’d try to put the concerns of these politicians about the economy into Brussels-perspective. Remember, we were talking to politicians who will bank a half-million euros just from their salaries over the course of this parliament. Last year I added up some of the perks they get on top, everything from daily allowances to business-class air travel to medical allowances to free disposable contact lenses to reimbursement for 60 sessions a year of mud baths. Being an MEP is a lotto win. How do you stay in sympathy with the unemployed in West Dublin with a life like that?

So I asked the five MEPs to justify the decision last week by the parliament’s budget committee to increase the MEPs’ entertainment budget for 2011 by 85 per cent. How could they justify that, given the suffering of people across Europe?

The five said they’d heard about no such thing. Mr de Rossa even denied there was an entertainment budget for MEPs. He suggested that newspapers had made up the story.

Since I was one of the journalists who had reported the story, I knew it had not been made up. I’d had my information from Marta Andreasen, an MEP who is a professional accountant. More to the point, she is a member of the parliament’s Budget Committee.

Here are the figures, as from this professional accountant: the MEPs’ entertainment budget for next year has jumped from €1,105,200 to €

2,047,450. Yet the five Irish MEPs at this propaganda-fest denied it in front of 15 Dublin journalists plus me. Unless I could identify the exact budget line for them right then, the MEPs said they wouldn’t admit such a thing could have happened.

The other journalists, unused to the ways of the parliament, couldn’t make anything of it. But I will give credit to Mairéad McGuinness, who, despite being indignant about my suggestion, had her staff check it. She came back to me a couple of hours later with a piece of paper showing the figures for a budget line labelled ‘Entertainment and representation expenses’. There it was: the huge jump in the entertainment budget that the Irish MEPs had all earlier denied could exist.

Half the eurozone is bleeding to death, but the MEPs will take a jump next year of 85 per cent for their ‘entertainment’.

[…]When Miss Day brought her comments around to the new so-called European External Action Service (the euphemism for the new EU diplomatic corps which is going to lead to the closing of many Irish embassies around the world), she assured the Dublin journalists that this vast army of diplomats and embassies would in fact be ‘revenue neutral, except for the first year.’

I waited for someone to ask, ‘But what about the first year, then?’ None of them did. I realised that even the sharp ones weren’t used to listening to eurocrats’ slimy-speak. If they’d asked (I didn’t, it was 6 pm and I was losing the will to go on), and if she’d given a straight answer, the Irish journalists would have learned the shocking truth.

What her propaganda pitch didn’t mention about Catherine Ashton’s new empire was that the new service is in raging cost-overrun. It is going to head for at least ¤33 million over its ¤455 million budget this year already – and it hasn’t even been launched yet.

Thirty-three million over budget in one year, and that is just called a failure to be ‘revenue neutral’. As I said, eurocrats’ slimy-speak. It’s the painful torture of a life in Brussels.

The EU-innocents last night boarded their flight back to Dublin. Before they left, I asked three of them if they’d felt their trip was a good use of taxpayers’ money. All three agreed it was.

I may ask them again after they see the tax increases that Finance Minister Brian Lenihan has planned for them in the next Budget. How strange that some journalists haven’t figured it out yet: there really is no such thing as a free lunch. Just like there’s no such thing as EU ‘information’.

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