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 A Fragile PartnershipPosted on May 4, 2010The present crisis of the European Union was inherent in the creation of the institution itself. It is a political-economic hybrid and was intended to be an alliance of mutually supportive qualities. The qualities have instead proved to be a contradiction, mostly dormant since the Brussels Treaty of 1948. That treaty established a “Western European Union” of “economic, social and cultural collaboration,” and also “collective defense.” In 1951, the European Coal and Steel Community was formed, placing under common control European heavy industry, including that of Federal Germany, making war impossible among the signers. These agreements were subsequently combined and enlarged in the 1957 Treaty of Rome, forming what today has become the European Union. The fateful flaw was that these founding treaties combined security and political cooperation with economic union, with this economic union conceived as the means by which the political goals would be reached. This brilliantly succeeded in the so-called Coal and Steel Community. Europe’s military security was in 1949 handed off to the new NATO, which brought in the two North American allies of the Europeans, the United States and Canada, to create a common defense against the perceived threat of Soviet aggression. The EU concentrated on the construction of institutions and agreements promoting union of Europe’s industrial standards and cooperation, establishing a common internal market, abolishing trade barriers and encouraging pan-European business. The free market in goods was logically complemented by the Schengen Accord in 1995, abolishing border controls and the need for passports for individual travel among most of the EU nations, plus Norway, Iceland and, more recently, Switzerland. Advertisement This created today’s situation, in which monetary union, and conceivably the European Union itself, may be threatened—just as monetary union’s critics had warned would happen. The question has always been how the European Central Bank can, with its single monetary policy, manage the disparate needs of the economies of the euro-committed states. This proved possible, if delicate and demanding, before Wall Street precipitated the world’s economies into a credit crisis. At first the attention of governments, and crucially of speculators, was on banks and other financial institutions endangered by the collapse of the securities they held. Rescued at enormous cost by governments, the major credit institutions survived but were badly wounded. Unless the governments of the Western countries—and specifically the Congress of the United States—prove able to impose the reregulation and new regulation of national and international finance, this crisis will recur in the future, from the same causes. To succeed, elected officials must reject the renewed pressures of the rapacious—and sometimes criminal—interests that developed and sold worthless securities to their irresponsible or ignorant counterparts and their customers. As to the criminal component in the crisis, I refer you to the explosive testimony presented by professor James K. Galbraith of the University of Texas at Austin to the Subcommittee on Crime of the U.S. Senate Judiciary Committee on May 4 (the day I am writing). Predatory speculation has now turned against economically vulnerable countries in the euro zone, Greece first of all, producing the political agonies of recent weeks in getting German agreement (above all) to support Greece in its debt crisis. Mischievously called a “bailout” by German authorities and the international press, this was actually a question of guarantees by other euro-zone Europeans of the loans needed by Athens to pay interest on its current loans. Seeing German hostility and obstructions to such help for Greece, the speculators and rating agencies piled on to drive up the rates at which these loans to Greece would be available—and most profitable to the speculators. They are now trying to do the same thing to Spain. (The French presidency has just described the conduct of the rating agencies as “criminal.”) Greece’s debt crisis is for the moment eased, thanks to the adjustment in Germany’s position that allowed the European Central Bank to announce Monday that it would accept Greek bonds as collateral for future loans. However, the fundamental problem is not solved. National indebtedness in all three vulnerable countries (Spain, Portugal and Greece) had in the pre-euro era the possibility of remedy by devaluation or by the opportune workings of inflation. That would have been a sovereign political decision. This sovereign decision has now been renounced. This will influence the British general election this week, as the Conservatives are appealing to the anti-EU electorate. In earlier years, European optimists said “Europe” would in the future be the new great power. It has not happened. The EU, and the expanded EU in particular, is collectively an economic power, but its limitations even in that respect have been painfully demonstrated. It is incapable of any but the most anodyne collective decisions concerning world affairs. On trade issues, “Europe” exists (and has a phone number). Until yesterday, “Europe” was a world financial power. This may no longer be true. The solidity of the euro and of the European Central Bank is in doubt. It’s not that Americans continue to rule. It’s the speculators, and their enablers, the rating agencies, who have taken charge. Will anything be done about it? Visit William Pfaff’s website at www.williampfaff.com. © 2010 Tribune Media Services Inc. CommentsAre you a Truthdig member yet? Login now, or register with Truthdig. Add Your Comment |
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By dihey, May 7, 2010 at 12:17 pm Link to this comment
The BENELUX and not the European Coal and Steel Community was the nucleus of a European Union.
Report thisBy Lawrence Baker, May 5, 2010 at 9:35 am Link to this comment
The banker and oil dominated Trilateral Bush/Obama Administration has purposely driven the United States of America into debt under their expert banking management by the systematic pillaging of our Treasury. Our National debt interest is at 15% about the same as the United Kingdom according to Moody’s bond rating March 15. “the U.S. will be paying about 15 percent of revenue in interest payments, more than the 14 percent limit that would lead to a downgrade to AA, Moody’s said.”
Report thishttp://www.bloomberg.com/apps/news?pid=20601068&sid=a0a8xAghPS8I
In the financial world, loosing your AAA bond rating changes the banking agreement substantially (as every home owner knows) that is when the fine print kicks in and the spiral to the bottom begins. Look at Greece, Latvia, Iceland and now the UK. Germany, France and Spain AAA credit ratings are in danger as reported in the U.K Telegraph on March 15 (referring to Moody’s) “The US rating agency said the US, the UK, Germany, France, and Spain are walking a tightrope-“
http://www.telegraph.co.uk/finance/economics/7450468/Moodys-fears-social-unrest-as-AAA-states-implement-austerity-plans.html
To control and accelerate that rush to the bottom of Nations, major banks are frontloading the odds of default of a Nation down on Wall Street in a computer so they can control and manipulate trades with high-frequency trading in derivatives. High-frequency trading is how Goldman Sacks (U.S.A) makes at least 200 million a day in derivatives on Wall Street and accounts for most of the 3.3 billion profit and 5.5 billion in bonuses last quarter. This one example of Goldman Sachs (U.S.A) operations is but the tip of the arrow head and the shaft is sure to follow. By flying the United States of America’s economy and government into the ground the New World Order of Trilateral Traitor bankers become winners. Now, who is the terrorist?
I hope Americans have empathy for the people of Greece and all the other people of Nations who face “Austerity measures” because their destiny will soon be our own fate. The bankers are brutal; the National financial burden is on the people with forced tax followed with the gutting of social services and privatization of National infrastructure and National Natural Resource for pennies on the dollar.
If you can empathize with these people I suggest that you take action and button-hole your representatives in Congress today and tell them to make a stand for the American People against this takeover of our government by Trilateral bankers and the New World Order. Demand that they insist that ALL of the subversive Trilateral members in government to STAND DOWN. Insist that Treason charges be served on all who conspired to overthrow our American Independence, Democracy and Freedom (there are only about 1,500 Traitors). Insist that Free Press, the watch-dog of Democracy, be restored by breaking up the monopolies in the mass Media.
Main Street Capitalism, Competitive Market, and Free Enterprise are America’s tried and true standard and our economy and government can recover from this treachery if we act now by getting back to our roots of industry, manufacturing and technology instead of being smothered by the Multinational Corporate Empire, by proxy, by our government. Our economy needs Fair Trade not (Free (sic) Trade and Free Enterprise and Competitive Market not controlled markets by the multinational corporate monopolies.
By Lawrence Baker, May 5, 2010 at 9:33 am Link to this comment
The SEC vs. Goldman is a test of strength between the American people and the World bankers, indeed, the New World Order. If the American people do not bring the bankers to Justice in our court system; our Democracy and the rule of law will be lost and the bankers will be free to dominate the World.
Report thisWill bankers and big oil lead humanity into an enlightened 21st. Century of green energy and humanitarianism or will this be the century of World Totalitarianism of the New World Order? We know that “morality” is a “no” word for bankers, big oil and investors alike; yet they are leading us into the New World Order with their heartless and coldblooded culture of greed by the few. World conquest by tyranny is not new and it certainly is not orderly; it is chaos. Hitler already tried World domination by tyranny in the last century. The nations of Greece, Latvia, and Iceland have already fallen into “order” and Spain, France, Germany, Portugal, Ireland, Italy, United Kingdom and the United States of America are scheduled to fall into “order”. The American people do not want to lose our Democracy, Independence and Freedom; yet this World totalitarian agenda emanates from the United States of America and is lead by the Bush/Obama Administration in our name. The World is looking at the American people as their last resort for salvation and praying that the American people will stand up to this evil force and do the right thing. By saving ourselves, we will also save them. We are the only ones who can change the direction of our own country with what freedoms we have left.
The injunctions will lead to the White House and the Bush/Obama Administration which is dominated by Trilateral World bankers. Zbigniew Brzezinski is the designer and architect of the bankers Trilateral Commission and the New World Order; he is also Obama’s top advisor. Geithner, Volker, Greenspan, Bernanke, Summers, Corrigan and Peterson are all of the same banking family of World bankers (America is their host) Goldman Sachs, Morgan Stanley, Bank of America, JPMorgan Chase, Wells Fargo Federal Reserve, IMF, World Bank, BIS, etc; their tentacles reach into every economy in the World. The World total economic output in 2009 was 58.07 Trillion and the total World bond market was 82.2 Trillion. The largest market in the World is the Derivatives market at 600 Trillion and is used primarily by the bankers as a weapon of mass destruction of economies to bring them in line with the New World Order. Their modus operande is the same for American citizens as it is for Nations.(pt.1)
By Shenonymous, May 5, 2010 at 4:16 am Link to this comment
Exactly who are the speculators, their enablers and rating
Report thisagencies? It would seem that nothing can be done about “it”
unless the culprits are specifically known and action taken
against them to desist? Am I wrong? It is impossible to
do anything about an amorphous blood sucker, for where
would the first strike land?