Welcome to European Tribune. It's gone a bit quiet around here these days, but it's still going.

Towards no Brexit deal on citizens' rights

by Migeru Sun May 7th, 2017 at 09:12:15 AM EST

On Friday Michel Barnier, the chief EU negotiator on Brexit, gave an important speech on the EU's position on citizens' rights.

In short, free movement of people is one of the four essential freedoms. These four freedoms are indivisible. This is how our Single Market works.

And let me be clear: the integrity of the Single Market will never be compromised in these negotiations.

But this point fell on deaf ears during the referendum campaign.

While the EU's position is reasonably plincipled, it seems to me it's a non-starter given Theresa May's stated positions. It also seems to me Barnier understands this.

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Could the EU be about to sacrifice Ireland?

by Migeru Thu May 4th, 2017 at 12:25:49 PM EST

After the Juncker leak of his dinner with May, I think it is the Republic of Ireland that should be filled with a sense of foreboding.

The odds of no deal being reached just shot up considerably.

The EU had earlier made it known that its negotiating priorities were "People, Money, and Ireland". Note that money comes before Ireland. And the insistence on the UK paying an "exit bill" and just this week apparently raising it, stands in the way of a deal on Ireland.

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To save Schengen, federalize border control?

by Migeru Sat Dec 12th, 2015 at 07:03:48 AM EST

It is being argued that this taking control of Schengen's external border from Brussels is the only way to avoid countries restoring their national borders, given the current mutual mistrust, lack of coordination and lack of information-sharing among Schengen member states.

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The Prague moment of the European Left

by Migeru Fri Jul 17th, 2015 at 08:31:59 AM EST

Cross-posted on The Court Astrologer.

Prominent heterodox economist James Galbraith, who enjoyed an inside view of the last five months of Greek negotiations as an advisor to Yanis Varoufakis, writes the following for a mainstream American audience: Greece, Europe, and the United States (Harper's, July 16, 2015)

What will become of Europe? Clearly the hopes of the pro-European, reformist left are now over. That will leave the future in the hands of the anti-European parties, including UKIP, the National Front in France, and Golden Dawn in Greece. These are ugly, racist, xenophobic groups; Golden Dawn has proposed concentration camps for immigrants in its platform. The only counter, now, is for progressive and democratic forces to regroup behind the banner of national democratic restoration. Which means that the left in Europe will also now swing against the euro.
The parallel between the Greek crisis and the Prague Spring, with a ruthless mainstream left crushing the hopes of an idealist left in defence of a system, is illustrated with poetic irony by the following tweet by a Social-Democrat finance minister from the former Czechoslovakia:Meanwhile, in an interview with Jacobin Magazine which we have already been discussing in previous threads on this blog, Left Platform Syriza MP Stathis Kouvelakis says the following about the ideology of "left-Europeanism": Greece: The Struggle Continues (Jacobin, July 14, 2015)
I think that in this case we can clearly see what the ideology at work here is. Although you don’t positively sign up to the project and you have serious doubts about the neoliberal orientation and top-down structure of European institutions, nevertheless you move within its coordinates and can’t imagine anything better outside of its framework.
I imagine that you could have written the same of Communist parties in the 1960s and their support for the Soviet Union. Out of the disappointment of the Prague Spring (on top of the invasion of Hungary a decade earlier) was born the Eurocommunist strand of the 1970s.

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Operation underpants

by Migeru Wed Apr 22nd, 2015 at 04:30:35 AM EST

The recent incidents involving over a thousand dead migrants in Italy and Greece has led to a new European Union strategy on immigration. Behold:

  1. Bomb the smugglers' underpants
  2. ???
  3. Profit!
see the "now, seriously" version below the fold.

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Juncker and how many divisions?

by Migeru Sun Mar 8th, 2015 at 01:27:43 PM EST

FT.com: Jean-Claude Juncker calls for creation of EU army (March 8, 2015)

The president of the European Commission has called for the creation of an EU army in order to show Russia “that we are serious about defending European values”. In an interview with German newspaper Die Welt,

Jean-Claude Juncker, who leads the EU’s executive arm, said an EU army would let the continent “react credibly to threats to peace in a member state or a neighbour of the EU”.


Mr Juncker said an EU army would “help us to develop a common foreign and security policy, and to fulfil Europe’s responsibilities in the world”. Nato was not a sufficient protection for the EU as not all EU members are part of the alliance, according to Mr Juncker.

And it's a great excuse for military Keynesianism, too!

Comments >> (51 comments)

Depression leads to a police state, Eurozone edition

by Migeru Mon Jan 12th, 2015 at 12:51:23 PM EST

This from Wolfgang Münchau in the Financial Times: Eurozone must act before deflation grips (January 11, 2015)

A slightly more realistic possibility would be a combination of QE, an external stimulus from oil and a fiscal boost. The eurozone’s fiscal rules leave little room for an increase in ordinary spending, or a reduction in taxes. But the fiscal rules are sufficiently flexible to allow countries to deal with emergencies. After last week’s terror attacks in Paris, it would be both feasible and appropriate for President François Hollande of France and other European leaders to invoke exceptional circumstances for a fiscal boost related to spending on internal security — without offsetting savings or tax increases. If terrorism does not qualify, what else?
And thus the tragedy of the 1930s repeats itself as a farce.

Comments >> (69 comments)

The horse race is on! (with poll)

by Migeru Thu Jan 2nd, 2014 at 10:42:13 AM EST

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Does anyone here still believe in the EU?

by Migeru Fri Sep 27th, 2013 at 05:22:58 AM EST

Our friend redstar asks:

Does anyone here still believe in the EU?

Keeping in mind the expression "army you have, not army you wish you had". In other words, now that you've seen what Europe is really all about, are you still for it, and why?

Use this as an open thread.

Comments >> (88 comments)

Neuroland: you're on your own

by Migeru Wed Sep 18th, 2013 at 03:44:50 AM EST

A momentous announcement to the European people, from Mark Rutte and Jeroen "Dieselbomb" Dijsselbloem, through the mouth of the Dutch King:

“The classical welfare state is slowly but surely evolving into a ‘participatory society’,” he continued – one, that is, where citizens will be expected to take care of themselves, or create civil-society solutions for problems such as retiree welfare.

(FT.com: King’s speech to parliament heralds end of Dutch welfare state, September 17, 2013)

You have been warned.

Read more... (76 comments, 209 words in story)

What are the Turkish protests about? - Gezi protests open thread II

by Migeru Thu Jun 6th, 2013 at 05:57:54 PM EST

Project Syndicate: Turkey’s Class Struggle (Ian Buruma, June 6, 2013)

So, rather than dwell on the problems of contemporary political Islam, which are certainly considerable, it might be more fruitful to look at Turkey’s conflicts from another, now distinctly unfashionable, perspective: class. The protesters, whether they are liberal or leftist, tend to be from the urban elite – Westernized, sophisticated, and secular. Erdoğan, on the other hand, is still very popular in rural and provincial Turkey, among people who are less educated, poorer, more conservative, and more religious.


It is easy to sympathize with the rebels against Bashar al-Assad’s dictatorship in Syria, for example. But the upper classes of Damascus, the secular men and women who enjoy Western music and films, some of them members of the Christian and Alawite religious minorities, will have a hard time surviving once Assad is gone. Baathism was dictatorial and oppressive – often brutally so – but it protected minorities and the secular elites.


Higher visibility for Islam is the inevitable result of more democracy in Muslim-majority countries. How to stop this from killing liberalism is the most important question facing people in the Middle East. Turkey is still a democracy. It is to be hoped that the protests against Erdoğan will make it more liberal, too.

Use this as an open thread for news and analysis on the ongoing Turkish protests.

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Turkey, not Dubai - Gezi protests open thread

by Migeru Sun Jun 2nd, 2013 at 03:53:56 AM EST

I have a feeling the protests taking place in Turkey are going to have broader significance, but I also feel I don't understand why they are happening. The story I was getting about Turkey before was that the country was increasingly self-assured, and its economy was doing well. So I didn't expect Turkish youth to have the feelings of lack of opportunity or betrayal of expectations that appears to be behind the Arab Spring, the European anti-austerity protesters such as que se lixe a Troika, the indignados, the movimento 5 stelle, the greek Syntagma protests, the American Occupy, or even in Germany Blockupy. Now in Turkey it's #OccupyGezi (others talk of a Turkish Spring).

However, an apparently small protest has led to what sounds like disproportionate use of force to repress it, and a media blackout with reports of an internet blackout (incuding rumours that Turkish ISPs were blocking facebook and twitter, as well as warnings that Turkish police would use facebook to identify activists and crack down on them).

Some simmering political tension has definitely boiled over with these events. These are some of the issues:

Use this as an open thread to bring in information and analysis on the Turkish protests.

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Cry me a haiku

by Migeru Thu Nov 22nd, 2012 at 05:57:20 PM EST

Shortly before midnight, after a dinner whose start was delayed to 10pm for undisclosed reasons, the following was released via twitter: Opening remarks by President Herman Van Rompuy at the European Council (22 November 2012)

Today we must decide on our Union's budget from 2014 to 2020. Maybe this meeting will be long and complicated. Fortunately this issue only comes up every seven years!

The decision before us is simple: making sure the Union has the money to do what we want it to do, for all of us, knowing the budgetary constraints in each of our countries.

Over these past weeks and in the course of the day, I already met all of you individually, and I listened carefully. All the views around this table are well known: red lines, requests for spending, requests for savings, and much more.

The proposal which I put on the table is a moderation budget. The times call for it. Doing more with less money involves political choices. This is painful, even when cuts are evenly spread. So we must be sensible and realistic.

But we must not forget this is budget for the rest of the decade. It must be future-oriented. My proposal focuses on jobs and growth in all regions and in different economic sectors, on research and investments, for instance in connecting Europe, while ensuring our Union can also continue to deliver the actions our citizens have come to expect.

I am working now for a deal with all of you. We have to work with the European interest in mind, alongside the national interests. Together we will find a balanced solution. It's necessary and I'm convinced it's within our reach. So, dear colleagues, let's get down to business.

The content of this statement would itself have fit in a tweet, or even a Haiku...

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Eurogroup Epic Effing Fail

by Migeru Wed Nov 21st, 2012 at 02:50:34 AM EST

Statement by the Eurogroup President, Jean-Claude Juncker (20 November 2012)

The Eurogroup welcomed the staff-level agreement reached between the Troika and the Greek authorities on updated programme conditionality, including a wide range of far reaching measures in the areas of fiscal consolidation, structural reforms, privatisation and financial sector stabilisation.

The Eurogroup noted with satisfaction that all prior actions required ahead of this meeting have been met in a satisfactory manner. This reflects a wide ranging set of reforms, as well as the budget for 2013 and an ambitious medium term fiscal strategy for 2013-16. These efforts demonstrate the authorities' strong commitment to the adjustment programme.

The Eurogroup commended the considerable efforts made by the Greek authorities and citizens to reach this stage.

Against this background, the Eurogroup has had an extensive discussion and made progress in identifying a consistent package of credible initiatives aimed at making a further substantial contribution to the sustainability of Greek government debt.

The Eurogroup interrupted its meeting to allow for further technical work on some elements of this package. The Eurogroup will reconvene on Monday, 26 November.

Which is Eurospeak for "this was the worst meeting since the December 2000 Nice Summit extravaganza on European Council voting rights".

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A great achievement in central banking (V)

by Migeru Tue Jul 24th, 2012 at 07:09:43 AM EST

Five years into the Global Financial CrisisGreat Clusterfuck, former ECB board member Lorenzo Bini Smaghi emerges from under the stone where he's spent all this time, reports Eurointelligence: How long can this go on? (Daily briefing, 24.07.2012)

Lorenzo Bini-Smaghi says the survival of the euro is now more important than the narrow goal of price stability

Writing in the FT, Lorenzo Bini-Smaghi says a key assumption underlying the ECB’s analytical framework is the efficiency of financial markets, which is no longer given.

Words fail.
“The euro area financial market, in all segments and maturities – including the very short term money markets – does not function properly, as banks deposit their excess liquidity with the central bank instead of lending to other banks. Cross-border banking flows have dried up.”
He had to be out of his job at the ECB for nearly a year to figure this out?
He writes there are two ways out: either the central bank addresses directly the disruption in the system, or member states repair it. His conclusion is that what is in danger right now is not price stability, but the euro itself.
You think, Mr. Bini Smaghi?

The Central Banking Hall of Fame series:

Read more... (6 comments, 596 words in story)

It's always about austerity

by Migeru Wed Apr 25th, 2012 at 05:21:58 AM EST

From the NY Review of Books comes an article by Physics Nobel Prize winner Steven Weinberg about The Crisis of Big Science. After documenting the dire state of science founding and recounting his own experience with the killing of the Superconducting Supercollider in the 1990s, he concludes with

Big science is in competition for government funds, not only with manned space flight, and with various programs of real science, but also with many other things that we need government to do. We don’t spend enough on education to make becoming a teacher an attractive career choice for our best college graduates. Our passenger rail lines and Internet services look increasingly poor compared with what one finds in Europe and East Asia. We don’t have enough patent inspectors to process new patent applications without endless delays. The overcrowding and understaffing in some of our prisons amount to cruel and unusual punishment. We have a shortage of judges, so that civil suits take years to be heard.

The Securities and Exchange Commission, moreover, doesn’t have enough staff to win cases against the corporations it is charged to regulate. There aren’t enough drug rehabilitation centers to treat addicts who want to be treated. We have fewer policemen and firemen than before September 11. Many people in America cannot count on adequate medical care. And so on. In fact, many of these other responsibilities of government have been treated worse in the present Congress than science. All these problems will become more severe if current legislation forces an 8 percent sequestration—or reduction, in effect—of nonmilitary spending after this year.


It seems to me that what is really needed is not more special pleading for one or another particular public good, but for all the people who care about these things to unite in restoring higher and more progressive tax rates, especially on investment income. I am not an economist, but I talk to economists, and I gather that dollar for dollar, government spending stimulates the economy more than tax cuts. It is simply a fallacy to say that we cannot afford increased government spending. But given the anti-tax mania that seems to be gripping the public, views like these are political poison. This is the real crisis, and not just for science

Why is is that every discussion these days revolves around the folly of austerity?

Comments >> (11 comments)

Draghi: "I come to bury the European Social Model, not to praise it"

by Migeru Fri Feb 24th, 2012 at 06:30:11 AM EST

The European Sovereign has spoken.

Draghi: The European social model has already gone when we see the youth unemployment rates prevailing in some countries. These reforms are necessary to increase employment, especially youth employment, and therefore expenditure and consumption.
I guess that's that, then.

Read more... (39 comments, 324 words in story)

A great achievement in Central Banking (IV)

by Migeru Tue Jan 3rd, 2012 at 07:03:34 AM EST

From Izabella Kaminska of FT Alphaville comes: The collateral crunch gets monetary

Put another way, there are not enough creditworthy counterparties in the system to encourage any sort of money multiplication effect at all. Banks and investors just want to get their principal back and are even prepared in some cases to pay out a negative interest rate to ensure that as much of their principal as possible is returned at some date.

Put another way still, the central bank transmission mechanism has been compromised because expansion or contraction of high-powered money makes no difference to the overall amount of money which is multiplied into the system.

And as we’ve noted before, that is exactly what happened during the Great Depression.

Clearly what we need is another round of fiscal consolidation...

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The Dutch Niemöller Moment

by Migeru Fri Nov 25th, 2011 at 04:25:08 AM EST

With this morning's Eurointelligence Daily Briefing [Subscription only] comes the following snippet and editorial commentary:

And Reuters reports that the Dutch have changed their position and now want the ECB to become more active in crisis resolution. (It is interesting to see what widening spreads and a domestic credit crunch can do to focus minds. )
Updated Euro crisis scorecard:
    GDP rank     Country       CAB/GDP status
    17  	 Romania	-5.13% under IMF
    22  	 Bulgaria	-3%
     7  	 Poland 	-2.41%
     3  	 UK		-2.23%
    16  	 Czech Republic -1.21%
    12 (8)	 Greece        -10.84% under EFSF
    14(10)	 Portugal	-9.98% under EFSF
    25(15)	 Cyprus 	-7.92% under attack
    27(16)	 Malta		-5.39% under attack
     5 (4)	 Spain		-5.23% under attack
     4 (3)	 Italy		-2.86% under Troika
    15(11)	 Ireland	-2.73% under EFSF
     2  	 France 	-1.79% under attack
    19(12)	 Slovakia	-1.36% under attack
    21(14)	 Slovenia	-0.73% under attack
     8 (6)	 Belgium	+0.5%  under attack
    13 (9)	 Finland	+1.43%
    10 (7)	 Austria	+2.31% under attack
    26(17)	 Estonia	+4.21%
     6 (5)	 Netherlands	+5.72% under attack
     1  	 Germany	+6.06%
    20(13)	 Luxembourg	+6.91%
    18  	 Hungary	+0.51% under IMFattack
    23  	 Lithuania	+1.86%
    11  	 Denmark	+3.42%
    24  	 Latvia 	+5.49% under IMF
     9  	 Sweden 	+5.95%

Read more... (62 comments, 555 words in story)

A great achievement in Central Banking (III)

by Migeru Wed Nov 23rd, 2011 at 04:49:14 PM EST

This blog post by Brad de Long (h/t kcurie) comments itself... The Austerity Play: Euronomics of Speculative Attacks

It used to be that speculative attacks against the currencies of sovereigns were successful in two cases:
  • When the central bank is trying to keep its currency above its real fundamental value, and is intervening by buying its currency and selling its (limited) supply of harder assets. Then you can break a central bank.
  • When the central bank is trying to keep its currency above its real fundamental value, and is intervening by selling domestic bonds for cash and so pushing up interest rates to make its currency attractive to hold. Then it is defending the dollar by attacking the economy--creating a recession and boosting unemployment. The central bank's ability to do this is determined by its (limited) politicians' willingness to make their voters poor and unemployed. Then you can break a central bank.
Now we have a third case. Note that it is not a speculative attack on a currency: core eurobond interest rates are very very low. And within the current eurozone, the ECB can print enough euros to peg the europrices of the eurobonds of peripheral eurosovereigns wherever it wants to. Given this power, under what circumstances can a speculative attack succeed?
Answer below the fold.

Read more... (42 comments, 325 words in story)
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