Where will the disgrace of defaulting be laid in Euroland?
The assumption during the present crisis seems to have mainly been that this will be true for the ex-nations that may be forced to default due to their inappropriate membership of the Euro Group. I wonder if that will be true? As it is the ECB and the triple 'A' rated Euro Group members who are driving the brutal and dreadfully misplaced policies that are clearly only worsening the plight of the periphery members, surely the eventual consequences will fall most heavily upon them?
As Default is now a matter of how rather than when, read this analysis from September last year, which appeared on the site of SafeHaven.com titled "Ask not Whether Governments will Default, but How", linked here, from which I quote the following:
- Does their claim on governments rank senior enough relative to other claims to fully shelter them from losses?
- If it does not, what form will this loss take?
In the Eurozone, it is now the ECB and the still liquid taxpayers who will be stuck with the costs of the imminent peripheral defaults.
In the UK other stakeholders will have to be found to take the hit. My posting on "Orphans of Liberty" over the weekend, titled 'The NHS can cure the country' sparked some debate, but charging for health care seems an obvious next step given the dire straits and deep incompetence of our country's rulers. The stakeholders in the UK are the taxpayers, and while banks and bondholders are to be protected it has to be at the expense of taxpayers or beneficiaries of Government spending, namely public pensions, health, welfare etc., defence by now having already been cut almost to the bone.
Huge and real cost savings can better be made, were our Government not scared witless at taking the role of the small boy in the crowd in Hans Christian Andersen's fairy tale, and pointing out to the EU, its increasingly obscene nakedness.
Refusing further money transfers until the EU ceases to operate beyond the intent and legality of the EU Treaties, would seem a perfectly reasonable and legally justified attitude to take. Worse, given the French Finance Minister's admission that Ecofin has been acting illegally over the EFSF, backing that same lady, Mme Christine Lagarde, for the post of Managing Director of the IMF, as George Osborne did at the weekend, shows not merely our complete insanity, but also our groveling subservience to the deeply flawed and clearly failing EU!
Labels: Christine Lagarde, Defaults, EFSF, NHS
0 Comments:
Post a Comment
<< Home