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ON WEDNESDAY TAOISEACH Enda Kenny presided over a ceremony at Farmleigh House where he launched a new EU tapestry to be woven by people from all 27 member states. Based on a painting, ‘Unity’ by Reitlin Murphy, the tapestry will display the word ‘unity’ in several languages as well as European flags. The Irish Presidency of the EU, now entering its fourth month, has been in hyperactive mode as intensive negotiations on the Common Agricultural Policy have concluded successfully and efforts to deliver key legislative priorities have ratcheted up.
Against this backdrop of technocratic ‘business as usual’, however, the European project continues to unravel. The increased prospect of a full-scale Eurozone implosion hangs like a menacing tableau in the post-modern palaces of the EU quarter in Brussels. It is difficult to make the case for EU unity and solidarity when a small member state has just been so spectacularly hung out to dry. Because Cyprus is adjudged to constitute a ‘non-systemic risk’ to the Eurozone it can be sacrificed on the altar of German electoral considerations and the continuing attachment of our leaders to ‘austerity fetishism’.
Judged even on its own term, austerity has been a total failure. After five years of tax rises and devastating spending cuts Ireland is still trapped in a vortex of economic dysfunction, weighed down by its commitments to the Troika and denied the oxygen of even modest growth which might help to alleviate unemployment and severe social distress. Earlier this week former US Treasury Secretary Larry Summers delivered a devastating critique of UK fiscal policy, stating that reductions in spending had not only failed to reduce the deficit but had actually impeded economic recovery. In much of Southern Europe austerity is responsible for producing the kind of unbearable social dislocation that we last saw in Europe in the immediate aftermath of World War Two.
In Spain and Greece the unemployment rate is heading for 30 per cent, with youth unemployment running at double this rate. With further spending cuts in prospect for a significant period to come these societies are experiencing a truly existential crisis. In the wake of its so-called ‘bailout’ Cyprus now has a clear template for what will follow in the months and years ahead.
The human tragedy which is often obscured by the deliberately opaque political discourse employed by EU elites and their spin doctors (‘adjustment programmes’, ‘recovery mechanisms’, ‘reform trajectories’) is exemplified in the recent experience of Bulgaria. Although it is not a member of the Eurozone its currency, the Lev, is pegged to the Euro and Bulgarian government policy in recent years has been to rigorously impose and stick to a programme of almost masochistic austerity in order to prove to the mandarins of Brussels and the IMF that the country will at some point be ready to assume the ‘responsibilities’ of membership.
That Bulgaria actually has an extraordinarily low level of national debt (about 16 per cent, lower even than Luxembourg’s) did not prevent the Borisov government reducing public service pay and pensions for four consecutive years in the name of fiscal rigour. In 2012 the retirement age was extended by one year with immediate effect. As Bulgarians endured the worst winter in decades they had to contend with huge increases in utility bills which pushed many households over the edge of absolute poverty. The shocking denouement to this terrible societal tragedy has seen six men set themselves on fire since mid-January. All of them subsequently died from their injuries.
That European citizens are now living in such desperate circumstances that they are prepared to self-immolate constitutes perhaps the most shocking indictment of the austerity policy mix championed by Brussels. Technocratic management-speak assumes almost Orwellian dimensions as Europe’s social foundations are being inexorably destroyed. A European integration process instituted in the 1950s to protect Europeans from the ravages of war and conflict has now become the greatest danger to social harmony across the continent.
Prior to the onset of the financial and economic crisis the European Union had an image problem. Perceptions of a so-called ‘democratic deficit’ revolved around the alleged gap between EU elites and ordinary people, that ‘Brussels’ was too remote from the concerns of its citizens, and that its institutional architecture was too obscure and operated in a governance ’bubble’ divorced from the realities of European life.
If the most obvious impact of the financial crisis has been felt in the economic sphere, the Bulgarian and Cypriot imbroglios also provide us with a timely reminder of the extent to which the EU has lost public opinion. The latest EU-wide ‘ Eurobarometer’ survey demonstrates that 29 per cent of the EU population had a negative view about the EU, a figure which represents an all-time high and almost double the level recorded prior to 2008. Simultaneously only 30 per cent of respondents hold a positive view of the EU, down from 50 per cent. There is a clear and discernible ‘Euro crisis’ effect in these figures and they demonstrate the extent of the gap between Europe’s elites and citizens.
The Cypriot case demonstrates that the European authorities are now prepared to cross the rubicon into the appropriation of deposits. Jeroen Dijesselbloem, head of the Eurogroup, let the cat out of the bag on Monday when he stated that the involvement of shareholders, creditors and large depositors in the Cyprus bailout could become a model for future bailout operations. Although he later retracted this statement it seems clear that the Cyprus crisis has seen the Eurozone enter a new and dangerous phase.
With each successive ‘fire-fighting’ operation it becomes clear that this is increasingly a self-inflicted crisis, one made possible by systematic mismanagement by European authorities. Markets are in the ascendancy and are now capable of driving sovereign governments toward the precipice of societal destruction. And all the while our leaders speak of ‘unity’ and ‘solidarity’.
Dr John O’ Brennan lectures in European Politics at NUI Maynooth and is Director of European Studies and of the Centre for the Study of Wider Europe.
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Theft, plain and simple.
This is what Ireland should have said to the EU, And it was pointed out clearly Here.
http://www.youtube.com/watch?v=lqovTGjYjM4
Fascism- the merger of state and corporate powers.
The people of Europe are united against it. European governments have come up with the concept for economic reasons only i.e. to make dirty bank trading easier by using a single currency. Now let’s rob it and use it to bring them down.
Brilliant article the only real hope is if a new political party comes along as there is no difference between FF and FG. Or if Britan leaves or the Euro collapses. We keep being told a euro collapse or a EU exit would be bad the truth is we are blindly running down the road to third world status with Ff or FG taking turns at the wheel but the EU consistent as the navigator.
Declan ganley is forming a new party in favour of lite touch eu.
Every time you perpetuate the “FF and FG are the same” myth, you’re just doing the bidding of Micheal Martin.
No myth Kevin,i’m curious ,really what other than the name is the difference?serious question.
1). The culture of corruption in FF that has become institutionalised in the party. 2). FF’s prioritisation of winning elections over doing the right thing by the country, however unpopular. The combination of both; corruptly cosying up to developers and bankers and letting the economy balloon via giveaway budgets created 3). They destroyed our economy and surrendered our sovereignty. These are profound difference, Norman.
A very good article John. A recent publication from two German finance experts Matthias Weik & Mark Friedrich “Der Gröste raubzug der Geschichte” ( The biggest robbery in history ) describes the ongoing rapid transference of wealth from the bottom up to the bankers and elite, in chilling detail. I dont know if its available in English yet.
(Warning:Not to be read before you go to bed)
ISBN 978-3-8288-2949-7
382 Seiten, Paperback
Tectum Verlag Amazon 19 Eur.
From above article ” Perceptions of a so-called ‘democratic deficit’ revolved around the alleged gap between EU elites and ordinary people, that ‘Brussels’ was too remote from the concerns of its citizens, and that its institutional architecture was too obscure and operated in a governance ’bubble’ divorced from the realities of European life.”
Marie Antoinette,looking out of her window just before the french revelution : Q Why are the people protesting ? A. Maam they have no bread. Q They have no bread.!. Why dont they eat cake then
“Let them eat cake” is in fact wrongly ascribed to Marie Antoinette who is claimed to have said it of the starving peasants who could no longer afford bread. In fact it is mentioned in a story before Marie Antoinette was born, by Rousseau, in his Confessions. There it is ascribed to a Greek Princess.
Rousseau also said, “Man is born free but everywhere is in chains”. His ideas were used to justify and fuel the French Revolution and yet he has become known as the intellectual founder of the modern totalitarian dictatorship and perhaps this could be a lesson to any would-be revolutionaries out there. The French Revolution was the first real revolution in the modern world when people rose up to overthrow royal elitism, yet it led to the rise of Napoleon. According to Albert Camus, all revolutions lead to an increase in state control- a Napoleon, a Mussolini, a Stalin or a Hitler.
It is said that no successful revolution lasts more than15 years.
: )
“The post-modern palaces of Brussels”
I like that in a shuddery sort of way.
@Anne De Croix : Thank you for the history lesson concerning “cake”. I hope you get the symbolic meaning though.
To ascribe to Rousseau though that he was the intellectual founder of the modern totalitarian dictatorship is merely a presumtion. Friedrich Niesctse was wrongly accused of bieng the intelectual founder of nazi ism. The Bible was misquoted as justification for many attrocities.etc.etc. Revolution I understand in its classical sense. Revolution = evolution Every small child is a revolutionary, teenagers more so when they protest about injustices. I should hope that the situation in Europe can evolve without it coming to something like the French revolution.
If Brussels stole money out of French saving accounts, then indeed,something like a repeat of the French revolution would have happened. They dare not.
Among other things they claim that the hub of cassino type banking has moved from London to Frankfurt in the last few years. Perhaps Cyprus offered too much competition.
Great article, these unelected Eurocrats have destroyed the European Union ..
The sooner the € is consigned to the dustbin of history, along with lunatic notions like European federalism, the better.
That infernal currency is strangling the life out of this country and others.
It’s a strange premise that it is austerity measures that have caused “social dislocation” in Southern Europe and elsewhere rather than the profligacy and economic mismanagement which led up to it. Blaming the medicine for the symptoms of the underlying disease, it seems to me. Like so many on here do.
This looting of private bank accounts goes far beyond austerity.
Kevin, all medicines carry with them side effects, a good doctor will decide whether that is worth it or not and if not look for a different remedy.
The problem here is the ‘doctors’ are crap
Paddy- if you’ve got Cancer and its looking like it might develop into something terminal, you’re going to end up getting Chemo, side effects and all, irrespective of who the doctor is.
The medicine isn’t working yet they keep upping the dose
A growing Irish economy, reduced interest rates, reduced overall debt, unemployment reducing and surgery to remove the cancerous Troika growth by years end ….the patient has been stabilised. Improvement to follow.
I’m waiting for the quality of your posts to improve, but I hold out no hope for that either :(
@kevin true, but unlike cancer a recession or decline in an economy is never terminal!!
To get away from the puns, my point is or it’s more of a suggestion but is it worth damaging societies and inflicting possibly long term psychological damage on a generation or two in order to keep wealthy people wealthy
Paddy- to completely murder the metaphor…we’re currently on financial life support with the Troika administering regular cash transfusions. That looks pretty terminal to me.
@ Kevin Shaw
The correct analogy is not with something as developed as ‘medicine’ as you wrongly suggest.
The more appropriate analogy, given the (inevitable) results, would be austerity as an application of leeches, indeed killing, not curing the patient.
And by the way, your term ‘profligacy & economic mismanagement’, by which I assume you meant in the public sector, could only apply to Greece, an absolutely irrelevant minnow in the Eurozone, absent the mess created by the feral private banking sector, rigged casinos & all, among all the Eurozone states, UK, US & elsewhere.
It is the losses of these supposedly too-big-to-fail-or-jail banks, dumped on to the public sector, which has created excessive government debt. That and the deliberate & unnecessary austerity which has since destroyed the ability of the economy to grow & earn the wealth to service & pay down the debt.
John, you are a ringer for that guy ‘Rocket’ off Soccer AM.
Lol, he is and all
Good article though John, the human and societal implications of the results of how the eu is being managed over this decade will have far reaching negative impact on the population for many decades to come!!!! Is it really worth it to save rich people a few bob??
There is never equality in any type of union or ‘ united states’. There will always be A periphery dominated by the stronger. Ireland became part of the Union ( UK) in 1800 with promises of equal treatment only to find that when the Famine hit, the UK wiped its hands, maintaining that it was an Irish problem for Irish ratepayers to address. This was followed by The Encumbered Estates Act ( NAMA) when indebted landlord estates were broken up and sold. ( sound familiar). Anyway back to the present, while there are many benefits in being part of the EU such as modernising legiskation and thr erosion of nationalism, the price to pay is that smaller countries have to accept that they have no automatic entitlement to a higher life than their own country can sustain. The central economies may share their wealth to build a union but they are naturally going to protect their own well being first and that of the peripheral nations second if the shit hts the fan.
Excellent article, tells it like it is, people such as McWilliams, O’Toole and Kerrigan have said it from the beginning but few listened. This austerity is unsustainable and it is only a matter of time before it breaks down, cue massive social unrest
Now come this is not flagged as an opinion piece ?
The raid on deposits is actually a deliberate strategy to scare people who are leaving large sums of money in banks into using it. For example buying property or shares. All other means of rescuing the tanked economy such as QE and bail outs have clearly failed. This latest one is real do or die stuff as it could lead to serious bank trouble again. If it fails we will go into a proper depression and most likely stay in one. If I had loads of cash I would buy gold and hold it myself. I would also buy some weapons.
Again I have to explain that we are a tiny little sweet country with a little population We can’t match their powers nor their languages. In fact they can speak ours. It’s time to look after our own country. Put an end foreign investments and rebuilt our own . These lazy politicians of the Republic want Joe Soaps to do their duties Who gives a damn about the Euro
Oops … Sorry … Just saw ” Column ” writ large in the top corner …. my bad !
Ireland is “[...] denied the oxygen of even modest growth”?
FYI, Irish GDP has been growing steadily since the end of 2009:
I guess that explains why we technically just went back into recession.
The key word there is “technically”. Actually, the country’s economy will grow this year, just as it has for each of the last four years.
If you don’t accept what I say, then at least accept what the page you quoted to me says:
“So although we are back in recession, we’re growing annually [...]“
Somebody need s to tell Angela meerkat and the german electorate where to take this austerity that serves them more than us as it satisfy s their obsession with inflation. …. European unity works fot the golden circle of so called core countries with the rest of us being expendable… be interesting if the non core countries unilaterally threatened to leave the eu and euro all at once… would be lots of ruffled feathers in Berlin
How is lending €10 billion hanging out Cyrpus to dry? What is exactly is the EU supposed to do? This vacuous article is all about blaming foreigners for domestic woes. Cyrprus like lreland is the author of its own banking mess. If there is anyone to blame it is successive Cypriot governments that signed up to a banking model that facilitated the laundering of Russian money. And if there is anybody to blame for our mess it is successive Fianna Fail governments that proned light regulation in the banking sector and irresponsibly inflated an asset-price bubble to the delight of its sponsors in the construction industry and ultimately to the ruin of taxpayers. Blaiming the Troika is like blaming the firemen for the water damage they caused putting out the fire.
Why were you having trouble making that destination for yourself?
I’ve yet to read a single article where the writer points out that had a country like Cyprus or Ireland had it’s own currency then it would have been devalued. The result would have been the same. People would have lost money. It’s nothing to do with the Euro. If a country screws up no matter what currency they use they get poorer. Why is this not clearly stated? Most of the comments above ignore this reality and are therefore inaccurate and pointless.
** how come
I am reading lots of criticism with no constructive alternatives. Take our situation, if you think austerity is bad could you imagine if we had not received the loans/bailout we did from the ECB, Troika and ECB. While I believe that we should have negotiated better terms we had to adopt austerity measures either way. Even a 75% tax take for the richest would not have come close to bridging the gap.
I shudder to think of you as a lecturer making comparisons to the Europe of today with the Europe of 1946. There were widespread famines and displacement of people in the millions. You should tone down the rhetoric and offer some alternatives.
If the criticisms in the article are accurate, wouldn’t it behoove you to come up with alternatives yourself before you demand them of anyone else? Sometimes I get the impression that pointing out the absence of explicitly proposed alternatives in a critical piece of writing is simply a way of passing over the substance of the criticisms and their implications.
The author isn’t comparing the Europe of today with the Europe of 1946. He’s saying that the institutional provisions put in place to address the human catastrophe of the Second World War, and to prevent it from happening again, are now being dismantled. If you agree, and you think this is a bad thing, you should be putting forward your own alternatives before shooting the messenger for not providing them.
Great article. A few other points. The Cyprus banks that got into trouble did so because they took a 50% hit on Greek government debt, which was part of the EU deal to aid Greece. Thus the EU probably knew there would be a subsequent problem with the Cyprus banks. The only explanation to this is political. When governments seize money from depositors it is game over for the banking industry. Money is going to flow out of Europe further deepening the crisis. The point of all of this blundering about by the EMF and EU could only be a big feck you to Russia. There is no sound economic reason.
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