Nicolas Sarkozy's stage-managed statements. There are two ways of interpreting Nicolas Sarkozy's grand stage-managed statements that the powers and operating mode of the European Central Bank (ECB) must be changed to get it to directly stimulate economic growth in the EU. One interpretation is that the French president agrees with the idea that the ECB should be able to buy up bonds from struggling member states. The other interpretation is that this is electioneering that has no chance of being agreed to at EU level. In the first case, it would amount to a split in the Merkozy marriage because they agreed in November never to talk about the ECB's policies, leaving it free to decide for itself. In the second case, Sarkozy could simply drop the idea later on on the grounds that his EU partners had not gone along with it.
Failure by the ECB. Over and above Sarkozy's own political views, it is simply a fact that in Europe, the world of finance has scuppered the ECB's action to solve the euro crisis. In December 2011 and February 2012, the ECB gave European banks cheap loans totalling €1 trillion with the aim of fighting off speculation. It did nothing to stop the speculators and, after initially reducing the interest rates demanded on struggling countries' sovereign bonds, the rates are now going back up again.
This is the backdrop to Sarkozy's comments, which amount to saying that if the ECB does not stimulate growth, then there will not be enough growth in Europe, and there are no taboo subjects or things that must not be discussed in front of the children. Another aspect that has been ignored in media reports about his speech is the fact that Sarkozy said that the euro is too high, and its exchange rate is not solely in the hands of the ECB, but is also an “area of cooperation” for heads of state on the European Council.
It is significant that the two front-runners - and in effect, the only real runners - in the French presidential elections agree with each other on the euro. François Hollande has commented that it was high time that Nicolas Sarkozy “got a clear idea” about these issues that he, Sarkozy, has been ignoring for the past five years. Ignoring the crossing of ideological swords, Sarkozy's circles have pointed out that he is able to say things as a candidate in the elections that he is unable to say as president and is making the most of it.
Disgusting and criminal. I am only commenting on the situation in one member state because it reveals changes in Europe and gives a startling confirmation of the disgusting and criminal behaviour of the financial world.
The EU is in the process of voting through a complex and quite comprehensive raft of rules and regulations, which we have been reporting and commenting upon in this newsletter. It is clear, however, that in the time it is taking for EU and international rules to be put in place and actually implemented in practice, speculators have been having a field day and using their powers and privileges to prevent the European and world economies from working properly. It is quite frankly astounding that speculators don't give a fig about the general interest of their fellow human beings. All they are interested in is the size of their own wallets, and they never lose any sleep about how this impacts on the wider economy and the living conditions of whole countries of people. The speculators are happy enough to admit that their world is evil and totally self-centred - but only when they have made their millions and have left that world behind. They then sometimes express a little remorse and set up charities and foundations to help a few of the people they have hurt.
City of London vs. Europe. The City of London's attitude acts against the interests of the European Union. The United Kingdom refused to agree to change the EU treaties, demanding the right to veto any EU financial regulations; and the City still counters attempts to introduce discipline (although the British government itself has agreed to go along with some rules), while the financial world at large (and not just the City of London) wreaks havoc by deliberately generating as much instability, doubt and malicious rumours as it can. The weakest member states fall victim to this, and whole nations of people are paying the price. The British prime minister told his parliament that he had rejected pressure from Merkel and Sarkozy in order to defend the interests of the City of London. This does not mean the interests of the United Kingdom alone, but of any bank involved in speculation.
Skirmishes on the sidelines. I am not going to describe a well-known situation for the umpteenth time. My aim here is to point out that the war against financial speculation is nowhere near won. There are plenty of skirmishes on the sidelines - the tax that used to be called the Tobin Tax is facing a number of problems, but making progress all the same; the European Parliament has recently discussed the fight against tax evasion; and assuming everything goes to plan, the fiscal compact of belt-tightening rules will soon be up and running. The EU institutions, headed by the European Parliament, are doing their utmost to back a strong stimulus to the economy (which I feel means that there is no need to change the fiscal compact to introduce economic recovery measures).
At the same time, a growing number of political movements believe that the current changes will inevitably lead to a federal Europe, although opinion differs widely on the details of this. The ideas about the problems with the ECB and how it needs to be changed, ideas recently mooted in France, are one, largely unexpected, part of a much bigger whole that will largely determine the future of Europe. (FR/transl.fl)