Was this the week the euro gave up the ghost and the EU threw in the proverbial towel? Analyzing the Anglosphere's dominant social themes is not an easy avocation and one looks for documentable breakthroughs. We have been fortunate to find several during the timeframe of this young publication but are always looking for more. Irish printing of euros seems to fit our criterion of a demonstrably significant event. (Information that makes you sit up straight and go "Wha?") The one that stands out the most for us previously (as we have mentioned before) was the Congressional appearance of Federal Reserve Inspector General Elizabeth Coleman. It was perhaps the single worst appearance of any official in the history of such appearances and left no doubt that the Fed had not a clue about how to handle the fallout from its various monetary insanities.
Now comes Ireland. In news reports that have thus far not attracted much attention, the Irish Central Bank has been printing euros out of thin air to prop up its ailing banks. The whole of Europe will pay for this action, as the result will be increased euro-zone price inflation. We can only imagine the reactions of Germans if this continues – though apparently the Irish action is legal from the EU's standpoint so long as the ECB is "informed" in advance and approves. As is often the case, we doubted our reaction to the news, so we went trolling the ‘Net to see if anyone shared our instinctive reaction that this was overwhelmingly bad news for the euro. Here's one comment we found:
Wait... have I just slipped into a parallel universe? Is this some sort of early April's fools joke? Doesn't this defeat the entire point of a single currency and the ECB? Were the rules changed on the quiet without anyone noticing?
Greece.... Greece are going to go f***ing apesh!t. They were forced to go begging to the IMF.... when the Greek people find out the [Irish] central bank is allowed to just print money, they are going to riot and demand tax cuts and benefits rising and massive spending. The Germans... well the Germans are just going to totally lose it. They've been told they should pay higher taxes to help the PIIGS, now they are being told the PIIGS can prints EUROS at will?
It's impossible to overstate the importance of this... this is it... game over. The EU has weeks maybe days left. I this really is true, this is the biggest news story since world war 2 finished, and may even lead to world war 3. (-RufflesTheGuineaPig@housepricecrash.co.uk)
See, dear reader, there really ARE others that share our immediate reaction (even if they are named Ruffles). It continually confirms our perspective that making governance more transparent in the era of the Internet is not perhaps necessary. The Internet is doing the job on its own. More evidence? Here's some additional news from Ireland:
Millions of euro in bonuses have been paid to Bank of Ireland staff since the introduction of the bank guarantee. The Government yesterday confirmed that it has launched an investigation into the payments after bank officials admitted supplying incorrect and misleading information on staff bonuses to the Dail. Senior officials at the Department of Finance will also probe a six-figure bonus paid to an executive at Bank of Ireland's asset management division.
Banks bailed out by the taxpayer have paid bonuses totaling €45m since being guaranteed by the State, including €20m to staff at the failed Anglo Irish Bank. When Finance Minister Brian Lenihan outlined bonus figures in December, the sum recorded for Bank of Ireland was nil. But it has now emerged that bonuses were paid. While the payment amount is not yet known, it will be established as part of the Department of Finance enquiry and will run into millions. (- UK Independent)
These are the issues that the Eurocrats will need to struggle with as they conclude their meetings today on expanding the size of the EU bailout fund. But no matter what the EU does, it is now seen as siding with large banks over the populace. Since Eurocrats spent 50 years building up the entirely risible meme that the EU was good for average folks, we can't imagine how the EU concept is going to recover, public relations-wise. Its leaders have placed themselves in opposition to citizens – and done so in a way that has already resulted in overt violence.
One does not see EU members meeting to discuss the plight of the average worker under "austerity." No the preoccupation, beyond Europe, is protecting the banking system. AP reports that Germany's finance minister Wolfgang Schaeuble will allow the bolstering the fund so it can "actually lend out the advertised 750 billion ($1 trillion) – which it currently cannot do due to technical reasons." Others have been hoping to double the size of the fund. There is Portugal to consider and Spain as well. Pay the tab for the one and there will be nothing left for the other.
It is certainly possible that the fund may be expanded, or otherwise made more utile, but will that be the end of it? France and Italy are two additional countries that have been mentioned as candidates for bailout money. In fact there is a hypothesis that French leaders have been leading the way in this matter because France will eventually need to tap the fund as well. Germany's participation in the fund remains under court challenge and polls show the German people have continually soured on the idea of placing German wealth at the disposal of the larger EU to pay for the pensions of PIGS.
Merkel has already lost political power because of her backing for the EU bailout and this is surely a primary consideration in Germany's hesitation over making changes to the bailout fund. Germans are well informed on the matter, no doubt to Eurocrats' collective chagrin. As we have pointed out many times, without the truth-telling of the Internet plans to expand the EU in a time of economic crisis would have gone far more smoothly. But the elite is in a bad place right now. It cannot ban the Internet outright as that would be neither practical nor prudent; yet every day this new communications tool expands, elite fear-based promotions erode further.
What Ireland is doing is a stopgap measure; one also apparently intended to staunch capital flight. But we have to wonder now that Ireland has set the precedent, who will be next? If the bailout fund is not expanded, or if the requirements prove continually onerous, are the Greeks and Portuguese going to begin to print euros as well? What will the Germans and other Northern EU countries think of that? Such actions undercut the EU's entire modern rationale. It smacks of desperation.
It must be said that the Eurocrats are a stubborn lot and having invested 50 years in building the EU, Brussels may yet lurch toward further integration. According to the UK's Guardian, French Prime Minister Francois Fillon recently said that, "in order to consolidate the euro we will need gradually to harmonise our economic, fiscal and social policies." And he added that Europe was at "a historic turning point."
We cannot imagine the larger European public endorsing such a move toward further centralization, however, which means, given Brussel's anti-democratic logic, that, simply, the public will not be given the option to vote. These are indeed shifting sands on which to build a supra-regional, integrated union.
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