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Over the past 18 months, increasingly Merkel and Sarkozy have been dictating EU Council policy, and organizing a string of bilateral summits (starting with Deauville last Autumn) where the next step in EU policy is announced to the world (and the Council).
In the case of the July market crisis, when it first flared up Sarkozy wanted to organize a summit to discuss Spain and Italy (yes, Italy is under Market attack and has been for nearly 2 months, at least as far as Sarko is concerned) and Merkel first 1) said she wouldn't attend because there was nothing to discuss; 2) hid behind Greece (she said she wouldn't even attend a second summit a week later unless a deal for Greece had been hammered out by then; 3) then ensured that the 21 July summit discussed nothing but Greece so it had to wait until the market meltdown of August 5 before Merkel and Wiedmann agreed to even acknowledge that the market was now attacking Spain and Italy and that the EFSF was dead in the water.
I said in mid-July that the Council should have called Merkel's bluff and met without her...
But whatever. Economics is politics by other means
Or do you actually think Sarkozy is some sort of Quisling?
That is my point. Most european countreis are governed by right-wingers, they enact right-wing policies. That is all.
Or do you think a different german government could all of its own force the EU in another direction?
This diary is about the PSOE panicking and adopting the PP's proposal (from 2010) to do the same, to general shock among the Spanish left public opinion.
So what? Do you think the Party of European Socialists provides a credible alternative? Do you think the SPD is not responsible for enabling the 2-year drive to EU wide constitutional debt brakes? Economics is politics by other means
By the way I already told what the opposition in Germany wants Eurobonds - transaction tax - Marschall plan financed by said transaction tax.
But you didn't listen. As usual
That's not being all powerful, it's being stupid. Economics is politics by other means
In the first place, if you can fund a Marshall plan type of project with a transaction tax, then your transaction tax isn't high enough. Because the whole point of a financial transaction tax is to kill the noise traders stone cold dead. Which, if it works as desired, also kills the base for that tax stone cold dead.
In the second place, even if they design a financial transaction tax to extract the maximum possible receipts, rather than impose the maximum possible harassment on noise traders consistent with not harassing productive businesses, revenues will not suffice to fund a Eurobancor. Even in the most optimistic possible estimate (where the Eurozone financial sector is assumed to contribute roughly half of the £ 250 bn that the Robin Hood Tax people guesstimate could be raised globally), it will fall short of plugging even the German CA imbalance (currently around $ 180 bn), to say nothing of the aggregate imbalances.
So while a Tobin tax is an excellent idea that will solve a great many problems, the biggest problem is not one of them.
- Jake Friends come and go. Enemies accumulate.
ATTAC and others make the mistake of seeing the Tobin Tax as a revenue generating mechanism which was never Tobin's intention when proposing it... Economics is politics by other means
So I tend to protest if I read analyses of the sort, Germany is planning this and wanting that. The current isn't planing and wanting mostly negative things, like to be left alone or to kick the can down the road so that they can concentrate on the coalition crisis.
Not that policy by drift can't be harmful.
Bear with me for a minute : Merkel, who visibly doesn't have any ideas of her own on macroeconomic policy or currency governance, muddles along making non-decisions, digging her heels in stupidly, delaying then accepting the inevitable, but too late to stop the crisis getting worse... but all the while working within the framework of conventional economic wisdom in Germany.
And as Germany is the economic hegemon within the Eurozone (as largest economy, and most "virtuous", since they are on the credit side of the imbalances), German conventional wisdom, in all its majestic stupidity, is the EU orthodoxy.
It's the madness of this conventional wisdom that we must fight. You are quite right that the conventional wisdom is widely shared by economic policy makers and political elites in other countries (though we may note that the French PS has rejected the "golden rule" that the SPD embraced). It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II
But the initially german line - no summit - had be abandoned. Hardly a proof of dictatorship.
"I said in mid-July that the Council should have called Merkel's bluff and met without her..."
Well, that is their problem, right? Any way it wasn't necessary; Merkel did give in.
Regarding the idiocy: Have I created the impression that I am a Merkel fan?
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