The powers that be in the European Union | 70 comments (70 topical, editorial, 0 hidden)

Re: The powers that be in the European Union (4.00 / 2)

A sovereign has a monetary and fiscal authority which is solvent by legal fiat in its own currency. By that definition no Eurozone state is sovereign, and in fact the ECB ranks above them all because the ECB can actually tighten the monetary thumbscrews on states in order to enforce policy changes outside the ECB's statutory purview.

Therefore, what you claim there is a popular majority implies rolling back to before the Maastricht Treaty.

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa

by Migeru (migeru at eurotrib dot com) on Fri Jul 20th, 2012 at 03:53:51 PM EST
[ Parent ]

Re: The powers that be in the European Union (none / 0)

One question, if one member-state were to retire from the euro, how legitimate would be the claim that euro-denominated debts are in its own currency, and that a change first of name, then of value, would not imply a revaluation of the foreign debt in euros?

res humà m'és aliè

by Antoni Jaume on Fri Jul 20th, 2012 at 04:07:30 PM EST
[ Parent ]

Re: The powers that be in the European Union (none / 0)

Most Euro debt is under national law, except for bailout money which I think is either under London or Luxembourg law.

However, both leaving the Euro and introducing different legal tender from the Euro would break a number of EU laws.

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa

by Migeru (migeru at eurotrib dot com) on Fri Jul 20th, 2012 at 04:12:34 PM EST
[ Parent ]

Re: The powers that be in the European Union (none / 0)

Yes, the present situation was supposed to never happen. Still exit has been trotted for Greece.

res humà m'és aliè

by Antoni Jaume on Fri Jul 20th, 2012 at 04:20:12 PM EST
[ Parent ]

Re: The powers that be in the European Union (4.00 / 2)

The ECB is trying to make Greece's life impossible as we speak: ECB turns screws on Greece, stops accepting collateral

The ECB move, which analysts said was aimed at stepping up pressure on Athens to adhere to the commitments of its EU/IMF bailout, will force Greek banks to turn to their national central bank for Emergency Liquidity Assistance (ELA) funds. Those funds will be more expensive than funds available in the ECB's regular liquidity operations.
The ECB said the collateral exclusion was due to the expiration of a temporary 35 billion euro scheme agreed with Greece and euro zone leaders whereby the ECB would continue to accept Greek bonds after they went into default this year.
...
European and IMF officials are due to visit Athens next week to decide whether Athens merits another tranche of aid from its latest bailout package and analysts said the ECB move was designed to step up pressure on Greece ahead of the visit.

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa

by Migeru (migeru at eurotrib dot com) on Fri Jul 20th, 2012 at 04:23:08 PM EST
[ Parent ]

Re: The powers that be in the European Union (none / 0)

One question, if one member-state were to retire from the euro, how legitimate would be the claim that euro-denominated debts are in its own currency, and that a change first of name, then of value, would not imply a revaluation of the foreign debt in euros?

On principle, you can make a strong case for either view. In practice, the police force and court system which enforce a debt decide which currency it is denominated it. The creditor decides whether he views this as a default, but creditor memory of default times out after about a year and a half.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Jul 23rd, 2012 at 03:18:11 AM EST
[ Parent ]

Re: The powers that be in the European Union (none / 0)

That is a very peculiar definition of sovereignity. One which the general public does not share. The general public is not ready to hand over power of budgets, taxes, health care and pensions to the EU. It would take that to make EU institutions more powerful than the member states.

As far as power over the ECB is concerned, you need to remember that the member states still hold the ultimate weapon. They can leave the Euro.

There is a popular majority that will force a regression to the pre-Maastricht state, but not a popular majority that desires this. As usually the voters want to eat and keep the cake.

by oliver on Fri Jul 20th, 2012 at 04:22:39 PM EST
[ Parent ]

Re: The powers that be in the European Union (4.00 / 5)

That is a very peculiar definition of sovereignity. One which the general public does not share.

The general public is wrong on economics because they adhere to common-sense-conservative frames.

The general public is not ready to hand over power of budgets, taxes, health care and pensions to the EU.

But that's what they have done with the Maastricht Treaty.

It would take that to make EU institutions more powerful than the member states.

EU institutions can break the back of member states and hide behind "markets" as they do so.

As far as power over the ECB is concerned, you need to remember that the member states still hold the ultimate weapon. They can leave the Euro.

Quote me a treaty article allowing Euro exit. Until you do (and you won't be able to), all EU member states can do is leave the European Union altogether.

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa

by Migeru (migeru at eurotrib dot com) on Fri Jul 20th, 2012 at 04:27:21 PM EST
[ Parent ]

Re: The powers that be in the European Union (3.80 / 5)

The public was told some things about Maastricht and the Euro, which it believed. Unfortunately these things have turned out to be in conflict with reality. And that puts it nicely.
That leads to certain problems. You cannot tell voters that you screwed them and then get them to agree to your newest proposal.

As for leaving the Euro we are approaching a very ugly area. The EU has quite limited means to enforce its treaties. If a member state insisted on leaving the Euro, the EU probably could make it leave the EU altogether. However, it is doubtful that the EU as a political project would survive that. The lawyers would be told to find some way and nobody would look closely at it. A bailout was also supposed to be strictly forbidden once.

by oliver on Fri Jul 20th, 2012 at 04:51:22 PM EST
[ Parent ]

Re: The powers that be in the European Union (4.00 / 4)

You cannot tell voters that you screwed them and then get them to agree to your newest proposal.

You can tell the voters that an earlier generation of politicians screwed everyone. Or you can tell them that other political parties screwed everyone. That's what happened in Greece with Syriza and his 30-something-year-old leader eating PASOK's lunch.

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa

by Migeru (migeru at eurotrib dot com) on Fri Jul 20th, 2012 at 05:09:47 PM EST
[ Parent ]

Re: The powers that be in the European Union (none / 0)

True. It will work sometimes and in some places. Yet even in Greece it took a peculiar electoral system and it was quite close. How could that be enough?

by oliver on Sun Jul 22nd, 2012 at 04:12:02 AM EST
[ Parent ]

Re: The powers that be in the European Union (4.00 / 2)

No, in Greece the peculiar electoral system was what allowed the Troika parties to govern nonetheless by giving ND 50 extra seats, it wasn't what allowed PASOK to implode.

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa

by Migeru (migeru at eurotrib dot com) on Sun Jul 22nd, 2012 at 04:58:17 AM EST
[ Parent ]

Re: The powers that be in the European Union (none / 1)

Wiemarize a country sufficiently and it will discard the gold standard. One way or another. The details will depend on the idiosyncrasies of the country in question, but discarding the gold standard is a constant.

This is the second most consistent historical experience in economics (the first one being that no, this time is not different).

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Jul 23rd, 2012 at 03:23:25 AM EST
[ Parent ]

Re: The powers that be in the European Union (4.00 / 5)

Which raises the question of how to increase democratic control of the EU in a confederacy to which many but all confederation members have surrendered their economic sovereignty.

If the European Council presently holds pre-eminent power, then moves toward democratizing the European Council would give leverage to the process. For instance, each state could send three members, head of government and at least two non-cabinet Parliamentary representatives. Council representatives limited to no more than three votes each and heads of government limited to no more than five votes would from 2 to 7 Parliamentary Representatives in addition to the Head of Government.

I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Fri Jul 20th, 2012 at 06:54:11 PM EST
[ Parent ]

Re: The powers that be in the European Union (none / 0)

"to which many but all" ...

... to which many but not all have surrendered their economic sovereignty.

I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Fri Jul 20th, 2012 at 07:16:03 PM EST
[ Parent ]

Re: The powers that be in the European Union (none / 1)

There should then be a mechanism to insure that the two or more non-cabinet representatives may not necessarily belong to the majority.

The last sentence is not very clear despite the typo "from" "form?"

by de Gondi (publiobestia aaaatttthotmaildaughtusual) on Sat Jul 21st, 2012 at 01:54:38 AM EST
[ Parent ]

Re: The powers that be in the European Union (none / 1)

Yes, proportionally. Say, each MP gets one vote, quota is is number of MP's divided by number of Parliamentary reps plus one.

I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Sat Jul 21st, 2012 at 09:49:36 AM EST
[ Parent ]

Re: The powers that be in the European Union (none / 1)

29 votes. 29/3=9rem2. So Parliament elects 8 members on a proportional basis, with 3 votes each, and the PM is the ninth member with 5 votes.

13 votes. 13/3=4rem1. So Parliament elects 3 members on a proportional basis, with 3 votes each, and the PM is the fourth member with 4 votes.

3 votes. Minimum 3 members, so Parliament elects 2 members on a proportional basis, with 1 vote each, and the PM is the third member with one vote.

I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Sat Jul 21st, 2012 at 06:15:55 PM EST
[ Parent ]

Re: The powers that be in the European Union (none / 0)

Useless, because power comes down to money. And those decisions are subject to ratification and informal mechanisms.

by oliver on Sat Jul 21st, 2012 at 02:49:50 AM EST
[ Parent ]

Re: The powers that be in the European Union (4.00 / 4)

Yes, without organized movements to push for reform, vested interests will rule. Democratizing institutions only opens up a chance, they don't deliver results without a fight.

I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Sat Jul 21st, 2012 at 09:52:53 AM EST
[ Parent ]

Re: The powers that be in the European Union (none / 0)

The power in the council is not determined by numbers of votes. It depends on the economy behind the members.

by oliver on Sat Jul 21st, 2012 at 03:22:42 PM EST
[ Parent ]

Re: The powers that be in the European Union (4.00 / 2)

But the entire economy of each nation speaking with one voice, that voice being the government of the day, that is an artificial construct of the Council.

Using the existing votes to determine how many members the parliament will send on a proportional basis is because those existing votes have already been hammered out and are enshrined in treaty, so leaving them alone makes sense ... precisely because the exact number of votes of each member is not the primary source of the problem.

I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Sat Jul 21st, 2012 at 06:12:16 PM EST
[ Parent ]

Re: The powers that be in the European Union (none / 0)

But the money has to be authorized. That needs a parliamentary majority. As long as the member nations act, they need to speak as one.

You may want the EU as a whole to act. But it lacks the money. Either you give it much more taxes or the money comes from the ECB. But for either extension of EU power there is no majority.

by oliver on Sun Jul 22nd, 2012 at 03:07:03 AM EST
[ Parent ]

Re: The powers that be in the European Union (none / 1)

But the money has to be authorized. That needs a parliamentary majority. As long as the member nations act, they need to speak as one.

What does this mean to say?

If it means to say that there would be a structural tension of it was possible to form cross-national coalitions in Council with ensuring the authorization of the money to carry out the program of the Council majority ... why, yes, there would be.

A proposed reform that would be sufficient to solve the structural problems of the EU is by its nature the most difficult type of structural reform to get through.

But contrast, if a proposed reform doesn't set up a structural tension with the status quo, there's no point to pursuing it, since its just a paint job.

So what is required are structural reforms that establish arenas in which it is possible to make substantial progress. And any such reform will be a source of structural tensions if its worth anything at all.

I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Sun Jul 22nd, 2012 at 05:54:42 PM EST
[ Parent ]

The powers that be in the European Union | 70 comments (70 topical, 0 editorial, 0 hidden)

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