Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Tesla Robo Taxis are Coming THIS YEAR! - 16th June 24
Will NVDA Crash the Market? - 16th June 24
Inflation Is Dead! Or Is It? - 16th June 24
Investors Are Forever Blowing Bubbles - 16th June 24
Stock Market Investor Sentiment - 8th June 24
S&P 494 Stocks Then & Now - 8th June 24
As Stocks Bears Begin To Hibernate, It's Now Time To Worry About A Bear Market - 8th June 24
Gold, Silver and Crypto | How Charts Look Before US Dollar Meltdown - 8th June 24
Gold & Silver Get Slammed on Positive Economic Reports - 8th June 24
Gold Summer Doldrums - 8th June 24
S&P USD Correction - 7th June 24
Israel's Smoke and Mirrors Fake War on Gaza - 7th June 24
US Banking Crisis 2024 That No One Is Paying Attention To - 7th June 24
The Fed Leads and the Market Follows? It's a Big Fat MYTH - 7th June 24
How Much Gold Is There In the World? - 7th June 24
Is There a Financial Crisis Bubbling Under the Surface? - 7th June 24
Bitcoin Trend Forecast, Crypto's Exit Strategy - 31st May 24
Zimbabwe Officials Already Looking to Inflate New Gold-Backed Currency - 31st May 24
India Silver Imports Have Already Topped 2023 Total - 31st May 24
Gold Has Done Its Job – Isn’t That Enough? - 31st May 24
Gold Stocks Catching Up - 31st May 24
Time to take the RED Pill - 28th May 24
US Economy Slowing Slipping into Recession, But Not There Yet - 28th May 24
Gold vs. Silver – Very Important Medium-term Signal - 28th May 24
Is Gold Price Heading to $2,275 - 2,280? - 28th May 24
Stocks Bull Market Smoking Gun - 25th May 24
Congress Moves against Totalitarian Central Bank Digital Currency Schemes - 25th May 24
Government Tinkering With Prices Is Like Hiding All of the Street Signs - 25th May 24
Gold Mid Tier Mining Stocks Fundamentals - 25th May 24
Why US Interest Rates are a Nothing Burger - 24th May 24
Big Banks Are Pressuring The Fed To Losen Protection For Depositors - 24th May 24
Another Bank Failure: How to Tell if Your Bank is At Risk - 24th May 24
AI Stocks Portfolio and Tesla - 23rd May 24
All That Glitters Isn't Gold: Silver Has Outperformed Gold During This Gold Bull Run - 23rd May 24
Gold and Silver Expose Stock Market’s Phony Gains - 23rd May 24
S&P 500 Cyclical Relative Performance: Stocks Nearing Fully Valued - 23rd May 24
Nvidia NVDA Stock Earnings Rumble After Hours - 22nd May 24
Stock Market Trend Forecasts for 2024 and 2025 - 21st May 24
Silver Price Forecast: Trumpeting the Jubilee | Sovereign Debt Defaults - 21st May 24
Bitcoin Bull Market Bubble MANIA Rug Pulls 2024! - 19th May 24
Important Economic And Geopolitical Questions And Their Answers! - 19th May 24
Pakistan UN Ambassador Grows Some Balls Accuses Israel of Being Like Nazi Germany - 19th May 24
Could We See $27,000 Gold? - 19th May 24
Gold Mining Stocks Fundamentals - 19th May 24
The Gold and Silver Ship Will Set Sail! - 19th May 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Why The Nobel Peace Prize For The EU Is Flawed

Politics / Euro-Zone Oct 17, 2012 - 03:51 AM GMT

By: Raul_I_Meijer

Politics Best Financial Markets Analysis Article

While everybody was asleep in a grandiose globalization and unification dream, a dream whose benefits and desirability were - and still are - hardly ever questioned if at all, separate languages and cultures simply remained what they were: separate. Now that globalization starts to show its dark and ugly flipside of economic depression, a repeal of many unifications and a split-up of larger entities, created for economic and political reasons only, into their smaller components, is inevitable.


Unfortunately, the architects who designed and built the larger entities are still in power. And they - which is probably also inevitable - go for double or nothing. That is a real and present danger for Europe, where Europeanization or even Germanification are the prescription du jour for the poor southern Club Med countries and everyone else, but the ultimate diagnosis will be the Club-medification (or Club-medication?!) of the people in the richer north. And that will lead to trouble. Lots of it.

The idea behind the EU, which can be summarized as peace and cooperation in Europe, was good in essence, and it worked for a pretty long time too, though how much of that was due to strong economic growth all over deserves more attention than it gets. The problem with the EU is the ever stronger centralization push that has developed from the much simpler roots that got the project started in the 1950s. The eurocrisis reinforces this push, which at the same time clashes with its direct opposite: a desire for decentralization on the ground.

And there lies the key to why the Nobel Peace Prize for the EU is so cynically wrong. If the EU keeps on pushing for more centralized powers to be put in its own hands, powers that will need to be taken away from member countries, it will not be a force for peace, but for fighting in the streets and other kinds of conflict and dissension. Not exactly Alfred Nobel's intention for his Peace Prize.

Then again, I think it's fair to say that the EU itself, the original idea, is not the main issue; it's with the introduction of the euro that things went really awry, and especially with the lack of preparation that was put in. We can safely say that was the moment megalomania took over.

Also, the eurozone is not some inevitable development flowing out of the EU ideal of cooperation. The EU could, and still can, exist either without a currency union or with a - much - smaller one. Countries like Britain, Sweden and the Czech Republic are appreciated and appreciative members of the EU who have their own currencies. And there is no reason why for instance Greece and Spain could not be in the same position. They would have to make the move back to their own currencies, but if that would help solve both their problems and those of the other eurozone countries, it warrants at least a thorough discussion.

Still, the EU wants no part of such discussions. The first reason for this may still come from the financial world. A move from the euro to a drachma or peseta would be doable only through some sort of sovereign default. And that would trigger credit events and force the pay out of derivative contracts, potentially to the tune of trillions of dollars. These contracts, however, are primarily held by financial institutions, so why should the people pay? These debts too can be restructured, and will, there's no other solution.

What's happening now is that the EU risks scaring away Britain, Sweden, Denmark, none of whom have any desire to lose their political powers to Brussels, even less than the rest. In other words, Brussels is not a unifying force anymore, but a divisive one. If it is allowed to stay on the current track, it will blow up the eurozone first and the EU itself shortly after.

The second reason for the EUs stubborn refusal to even discuss letting member countries leave the eurozone lies squarely in the bureaucracy. The centralization meme is so strong in Brussels any contradictory voices are ostracized. That is true too for politicians in power in membership states.

If anything exemplifies this, it must be that a "new" European Master Plan, an obviously purely political design, was introduced by German Finance Minister Wolfgang Schäuble (Schaeuble) this week. The boundaries between powers and responsibilities have faded to the point where measures that will have far-reaching consequences for the level of democratic decision making in 17, if not 27, very different countries are pushed by a finance minister. Certainly something to ponder.

The EU is controlled by a large and opaque bureaucratic class, not unlike those in China and the USSR. A difference is that it’s democratically elected in name, but that doesn't mean much: nobody votes (in a lovely ironic twist, the only time voters do turn up is for saying no to for instance a European constitution). Besides, most of the important posts in Brussels, Strasbourg, Frankfurt, are held by non-elected people. So much for promoting democracy.

Another difference with other bureaucracies is that nobody seems to know who exactly leads the EU, so accountability is impossible to assign. Who knows what exactly are the differences in responsibilities between Mario Barroso and Herman van Rompuy, just to name an example? Do they themselves even know? The real power lies with the European Commission (EC), but who truly knows what that even is, or who's part of it? Politburo, anyone? And we're not even talking yet about what and where the ECB is in all this, which has all but openly admitted it has political goals.

If the bureaucracy gets it way, people all over Europe will one day soon wake up to find themselves substantially impoverished AND with much of the political and economic powers over their destinies transferred to Brussels. How do you think that will play out?

What's certain is that we will see a lot more of things like the Spanish army threatening to crush the "vultures" of the Catalan independence movement. That's something the EU could play a positive role in, making sure it's understood those kinds of threats are not acceptable. But that's not happening. They have a Spanish government in place that's on their side, and that's all they're interested in.

It’s not a bad thing for a people to want their own country with its own frontiers, and with the final say in their own affairs, economically, politically, culturally. This right to self-determination is embedded in international law through the UN for good reasons. Why, then, the resistance to let even Greece become "independent", let alone Catalunya, Scotland, Flanders?

The opaque and - to put it mildly - not so democratic leadership follows two one-dimensional dreams, and anyone who gets in the way is swept aside.

They hope that they can keep the eurozone together, with every European's money, credit events can be prevented, and their grand dreams of one Europe can be fulfilled. This by now resembles a giant everything-on-red gamble far more than it does a mere dream. And gambling does not policy make.

There are millions of people in Europe who don't want to be governed by other countries, other cultures, other languages than their own. These sentiments will be strengthened going forward by deteriorating economic conditions, a deterioration guaranteed to evolve precisely because trillions of euros are spent to keep the eurozone together at all costs.

People are certain to rise up against these developments, and violently too, which makes the EU, and those who represent it these days, resemble war-mongers instead of peace-makers. Someone better stop this soon, or the genie will be out of the bottle and not be put back in for decades. The EU leadership in its blind race for increasing power will help all sorts of extreme politicians into their respective saddles, and they won't be able to bully all of them, let alone the people who vote for them, into submission.

Peace prize my ... The EU could have been, and probably was for a while, a beneficial institution. Unfortunately it has grown into a bloated, blind, colossal and very dangerous failure. Unless there's a mass wake-up call, and soon, dark days are ahead.

By Raul Ilargi Meijer
Website: http://theautomaticearth.com (provides unique analysis of economics, finance, politics and social dynamics in the context of Complexity Theory)

© 2012 Copyright Raul I Meijer - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in