May 13th, 2012 Posted 9:11 am
Originally posted December 11th, 2011
The British pantomime season has opened slightly early this year with Prime Minister David Cameron firmly cast as the pantomime villain by Merkozy, the collective name for Angela Merkel of Germany and Nicholas Sarkozy of France. Britain stands alone in voting against the Merkozi plan of the 27 EU countries. To be fair, the Swedes, Czechs and Hungarians had great concerns too but went along with the EU crowd whilst still reserving the right to debate the issue in their parliaments. The key issue is that the UK has the right to veto the overall vote. Basically this is supposed to mean that the EU cannot implement the Merkozy proposals as EU law, but the Eurozone countrys concerned can still impelent it separately.
In general the Merkozy plan is to bolster confidence in the Euro and EU sovereign deby by introducing European laws to limit sovereign nation state budget defecits to low levels of around 0.5 percent with a maximum annual defecit of 3% during recessionary times. An additional plan was to introduce a financial transaction tax. Since 80% of europes major financial transactions are conducted in London this was seen by the british as a Franco/German ruse to impose a new EU tax on one of Britains key industries that would affect France and Germany far less than Britain.
Its all very well Merkozy gaining approval in principle from 26 countrys but the actual implementation of this plan will be far more painful than just saying yes, oui or ja in an undemocratic EU meeting. What will happen when massive cuts in public spending are imposed by Brussels on the PIGS (Portugal, Ireland, Greece and Spain) for example. Its one thing for their governments to implement cuts at a politically acceptable levels for their own country but it does not take a genius to work out that if say Germany orders Spain to cut its defecit that the possibility for civil disorder is huge and in short this is highly unlikely to work.
May 13th, 2012 Posted 7:38 am
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