Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.
Since ECB has threathened to sink the Greek banking systems if the government did not accept killing of their own economy, we know that there are other forces th[a]n law at play.

And apparently they strongarmed Ireland into accepting a "rescue" within days of the Irish finance minister claimin that the Irish government was funded on a cash-basis for over half a year.

The ECB has also famously sent a letter to Italy's government with a shopping list of legislative reforms that must be enacted or the Italian banking system will be killed. There are contradictory stories about similar demands on Spain.

Trichet, when accepting the Charlemagne Prize for "contributions to European Unity", suggested an EU finance minister without a budget but the power to interfere with member state budgets. This has now been picked up by the Dutch Prime Minister.

This is really looking like rule by Central Banker.

Economics is politics by other means

by Migeru (migeru at eurotrib dot com) on Thu Sep 8th, 2011 at 07:29:14 AM EST
[ Parent ]
And Italy's government has just approved the balanced buget amendment
"Un ok rapido in Parlamento è nell'interesse del Paese", ha detto ancora Tremonti. Aggiungendo che il principio varrà anche per gli enti locali. Per garantire il pareggio di bilancio, saranno modificati tre articoli della Carta: non solo l'articolo 81, che fino ad oggi prevedeva l'obbligo di copertura delle leggi, ma anche l'articolo 53 (sulla contribuzione dei cittadini) e il 119 (sul federalismo fiscale). Il testo del disegno di legge prevede: "Non è consentito ricorrere all'indebitamento, se non nelle fasi avverse del ciclo economico nei limiti degli effetti da esso determinati, o per uno stato di necessità che non può essere sostenuto con le ordinarie decisioni di bilancio".
There's an exception for adverse economic conditions, but no details that I can find.
by gk (gk (gk quattro due due sette @gmail.com)) on Thu Sep 8th, 2011 at 07:33:51 AM EST
[ Parent ]
That's pretty stringent: recourse to debt is not allowed, except in adverse phases of the economic cycle within the bounds of the effects determined by the cycle, or due to a state of necessity that cannot be sustained with ordinary balance decisions.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Thu Sep 8th, 2011 at 07:39:00 AM EST
[ Parent ]
An unemployment rate above zero per cent is a state of necessity that cannot be legitimately sustained with ordinary balance decisions.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu Sep 8th, 2011 at 09:01:37 AM EST
[ Parent ]


Top Diaries

Occasional Series