An Irish view of the Euro crisis in 2011 - EU Federalists' dreams fulfilled.
Dan O'Brien, Economics Editor for the Irish Times sets out a wide-ranging view for the economy of his country this morning, linked here. The article concludes with his views on the prospects for the Euro, which I quote below. English readers should pay careful note, written as it is in their native tongue from a country within the sixteen nation Euro Group:
In 2011 there are, broadly, three possible outcomes for the euro crisis: decisive resolution leading to a restoration of calm; continued crisis with regular flare-ups and concerns about the currency’s future viability heightening, and a breaking apart of the euro.
The first outcome appears the least likely of the three in 2011. The problems are so deep and the record of euro area governments and institutions in dealing with them so poor that it is difficult to envisage a calming of the crisis.
By far the most likely outcome is a continued muddling through, with more ad-hoc measures put in place to deal with the crisis. Those measures will become more radical if the situation deteriorates.
A bailing out of Spain (Portugal’s rescue can be taken as a given) would bring the crisis to a new level. The €750 billion available under the current rescue mechanism, in whose embrace Ireland will be gripped until the end of 2013, would be exhausted.
Italy would then be next in the firing line. Its government is the third most indebted in the world in absolute terms, after the US and Japan. In 2011 alone, it will need to borrow €350 billion, mostly to pay back (or “roll over”) existing debt. If it cannot do so, the extension of the bailout mechanism would be unlikely. More radical steps would be necessary. Even if a massive money-printing programme, of the kind undertaken in the US, were to be given the all-clear by Germany (something that is very unlikely), it would probably not be enough at that point to break the vicious circle.
The choice facing Europe in that eventuality would be to allow the euro (and the European banking system) to collapse or to take a large leap towards further political integration in the form of fiscal union.
Europe may well find itself in 2011 having to choose between a meltdown of apocalyptic proportions and taking a very large step towards European statehood. It is unthinkable that the former would be permitted, so the chances of the latter are not inconsiderable.
Euro federalists may have their hearts’ desire in 2011, but hardly in circumstances for which they would have wished. (Blog editor's added emphasis)
The reaction to such a EU federalist's dreams being realised in Scotland will IMO be quite different to that of those who consider themselves as British/English. Our Prime Minister, who fondly boasts of the Scottish blood flowing thickly through his veins and other similar closet Scottish nationalists will probably delight at the opportunity a federal EU will provide to finally cast aside the remaining ties to England (although, given their very nature they will no doubt fight to the last to retain the unfair subsidies with which English taxpayers have been burdened for decades under the Barnett formula).
In England in view of the EU federalist views of Cameron's coalition partners, resistance to our joining the long-envisioned federal super-state will therefore be made doubly difficult. Yesterday's tell-tale debate on the blog ConservativeHome to nominate the top Liberal Democrat politician for 2010 (where my nomination of David Cameron was twice rejected for publication) must surely alert any remaining opponents of a federal EU super-state within the Conservative Party to now withdraw from that party and properly prepare for the final battle for our nation's independence which quite clearly now lies just around the corner!
A huge burden now falls on the voters of Oldham and Saddleworth when they vote on 13th January. If the consensus appears in two weeks time as a complete rejection of the three main parties, however expressed, then those believing in an independent Britain, re-establishing its strong international links through the Commonwealth and throwing aside the corporatist totalitarianism of a non-democratic EU will perhaps gain the courage to break free from the claustrophobic constraints of the three conspiratorial parties who are the enemies of democracy and individual liberties across the UK while wearing the disguise of " good europeans"
In 2011 there are, broadly, three possible outcomes for the euro crisis: decisive resolution leading to a restoration of calm; continued crisis with regular flare-ups and concerns about the currency’s future viability heightening, and a breaking apart of the euro.
The first outcome appears the least likely of the three in 2011. The problems are so deep and the record of euro area governments and institutions in dealing with them so poor that it is difficult to envisage a calming of the crisis.
By far the most likely outcome is a continued muddling through, with more ad-hoc measures put in place to deal with the crisis. Those measures will become more radical if the situation deteriorates.
A bailing out of Spain (Portugal’s rescue can be taken as a given) would bring the crisis to a new level. The €750 billion available under the current rescue mechanism, in whose embrace Ireland will be gripped until the end of 2013, would be exhausted.
Italy would then be next in the firing line. Its government is the third most indebted in the world in absolute terms, after the US and Japan. In 2011 alone, it will need to borrow €350 billion, mostly to pay back (or “roll over”) existing debt. If it cannot do so, the extension of the bailout mechanism would be unlikely. More radical steps would be necessary. Even if a massive money-printing programme, of the kind undertaken in the US, were to be given the all-clear by Germany (something that is very unlikely), it would probably not be enough at that point to break the vicious circle.
The choice facing Europe in that eventuality would be to allow the euro (and the European banking system) to collapse or to take a large leap towards further political integration in the form of fiscal union.
Europe may well find itself in 2011 having to choose between a meltdown of apocalyptic proportions and taking a very large step towards European statehood. It is unthinkable that the former would be permitted, so the chances of the latter are not inconsiderable.
Euro federalists may have their hearts’ desire in 2011, but hardly in circumstances for which they would have wished. (Blog editor's added emphasis)
The reaction to such a EU federalist's dreams being realised in Scotland will IMO be quite different to that of those who consider themselves as British/English. Our Prime Minister, who fondly boasts of the Scottish blood flowing thickly through his veins and other similar closet Scottish nationalists will probably delight at the opportunity a federal EU will provide to finally cast aside the remaining ties to England (although, given their very nature they will no doubt fight to the last to retain the unfair subsidies with which English taxpayers have been burdened for decades under the Barnett formula).
In England in view of the EU federalist views of Cameron's coalition partners, resistance to our joining the long-envisioned federal super-state will therefore be made doubly difficult. Yesterday's tell-tale debate on the blog ConservativeHome to nominate the top Liberal Democrat politician for 2010 (where my nomination of David Cameron was twice rejected for publication) must surely alert any remaining opponents of a federal EU super-state within the Conservative Party to now withdraw from that party and properly prepare for the final battle for our nation's independence which quite clearly now lies just around the corner!
A huge burden now falls on the voters of Oldham and Saddleworth when they vote on 13th January. If the consensus appears in two weeks time as a complete rejection of the three main parties, however expressed, then those believing in an independent Britain, re-establishing its strong international links through the Commonwealth and throwing aside the corporatist totalitarianism of a non-democratic EU will perhaps gain the courage to break free from the claustrophobic constraints of the three conspiratorial parties who are the enemies of democracy and individual liberties across the UK while wearing the disguise of " good europeans"
Labels: Euro, Oldham, Super State
posted by Martin at 8:39 AM
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