New EC Thread
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Re: New EC Thread
Panda Sat 4 Feb - 12:11
Cartoon
Germany
Angela’s commandments
3 February 2012
The Economist
London
Author
Born in Switzerland in 1952, Peter Schrank worked as a freelance
cartoonist and illustrator in London for 20 years, before moving to
Suffolk in 2002. He regularly publishes cartoons in The Economist, The
Independent, Basler Zeitung and the Sunday Business Post. Honoured in
the British Press Awards in 2000 and […]
German chancellor Merkel's Tablets of Fiscal Law according to The Economist:
"Thou shalt not incur a structural deficit. Thou shalt pay down thy
excessive debt. Thou shalt adopt a balanced-budget rule in thy
constitution, and subject it to the European Court of Justice."
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NEW ORDER
Panda Sat 4 Feb - 13:24
ew order
3 February 2012
This time around, there was no question of a last-ditch summit.
Nonetheless, the 30 January European Council meeting will have far
reaching consequences. Twenty five member states – in other words the
EU without the UK and the Czech Republic, which refused to be involved
– adopted the fiscal and budgetary pact that Germany, seconded by
France, wanted to impose.
Once twelve national parliaments have approved the text, which is
slated to be signed in March, participating countries will no longer
have the right to declare a spending deficit of more than 0.5% of GDP,
and will be subject to automatic sanctions if this figure exceeds a
ceiling of 3%. So from now on the economic policy of virtually all of
Europe’s member states will be confined to a strict and immutable
European framework.
This should have been a logical consequence of the Maastricht Treaty
and the introduction of the single currency, but it was a challenge
that the European leaders of the time were reluctant to face. Under
pressure from the crisis, today’s leaders have moved a step further
towards a federal Europe, or – from another perspective – they have
abandoned even more national sovereignty.
The new order will thus be characterised by Merkelian discipline,
but that does not mean an automatic end to the eurozone crisis. At a
time when Athens, its private creditors and the troika are continuing
to blame each other for the persistence of the threat of Greek default,
and demanding additional efforts from each other to resolve it, the
discovery of a new €15bn black hole in Greece’s books is not likely to facilitate discussions. Nor is the unofficial German plan to appoint a budget commissar for Greece.
And this situation may be further compounded by the ratings
agencies, and in particular Standard & Poor’s, which will probably
not be prepared to politely wait for the ratification of the pact
before announcing further eurozone downgrades.
Finally, the manner in which the pact was adopted has left a sour
atmosphere, which could herald further difficulties in the future. No
one can be happy to see London and Prague shy away from the proposal,
even if internal politics played an important part in those decisions. A
Europe without the British would certainly be a much weaker world
power, and Central Europe’s need for a solid anchor in Europe has never
been greater: Hungary is increasingly in breach of community standards, while Slovakia is being rocked by a corruption scandal which may have unpredictable consequences. Meanwhile, Romania is perhaps only beginning to revolt against austerity.
In Ireland, arrangements to ensure that the pact can be adopted
without a referendum could backfire and undermine the bailout plan
established in 2010. Finally, with regard to Greece, everyone – with
the apparent exception of Angela Merkel and the troika negotiators –
is aware that, regardless of the inadequacy of national authorities in
the country, the population is close to breaking point.
In the middle of all of this, Germany is continuing to design the
Europe it wants to see, especially now that it has been “freed” from
the constraint of partnership with a domestically weak Nicolas Sarkozy,
while remaining reluctant to assume the new responsibilities thrust
upon it by the crisis.
The consequences of this state of affairs are not only economic, but
also cultural. Angry and impulsive outbursts have become increasingly
common, and allusions to Germany’s Nazi and Prussian past are more and
more prevalent in Europe. More insidious than economic and social ills,
the emergence of this trend and the renewed rise of nationalism are
cause for serious concern of a kind that cannot be allayed by a
budgetary pact.
Author
French journalist Eric Maurice, (b. 1972) is editor in chief of
presseurop.eu. After joining Courrier international in 2000, he was in
charge of the Paris weekly's France pages, before covering North
American affairs, and later becoming chief editor for Western Europe.
3 February 2012
This time around, there was no question of a last-ditch summit.
Nonetheless, the 30 January European Council meeting will have far
reaching consequences. Twenty five member states – in other words the
EU without the UK and the Czech Republic, which refused to be involved
– adopted the fiscal and budgetary pact that Germany, seconded by
France, wanted to impose.
Once twelve national parliaments have approved the text, which is
slated to be signed in March, participating countries will no longer
have the right to declare a spending deficit of more than 0.5% of GDP,
and will be subject to automatic sanctions if this figure exceeds a
ceiling of 3%. So from now on the economic policy of virtually all of
Europe’s member states will be confined to a strict and immutable
European framework.
This should have been a logical consequence of the Maastricht Treaty
and the introduction of the single currency, but it was a challenge
that the European leaders of the time were reluctant to face. Under
pressure from the crisis, today’s leaders have moved a step further
towards a federal Europe, or – from another perspective – they have
abandoned even more national sovereignty.
The new order will thus be characterised by Merkelian discipline,
but that does not mean an automatic end to the eurozone crisis. At a
time when Athens, its private creditors and the troika are continuing
to blame each other for the persistence of the threat of Greek default,
and demanding additional efforts from each other to resolve it, the
discovery of a new €15bn black hole in Greece’s books is not likely to facilitate discussions. Nor is the unofficial German plan to appoint a budget commissar for Greece.
And this situation may be further compounded by the ratings
agencies, and in particular Standard & Poor’s, which will probably
not be prepared to politely wait for the ratification of the pact
before announcing further eurozone downgrades.
Finally, the manner in which the pact was adopted has left a sour
atmosphere, which could herald further difficulties in the future. No
one can be happy to see London and Prague shy away from the proposal,
even if internal politics played an important part in those decisions. A
Europe without the British would certainly be a much weaker world
power, and Central Europe’s need for a solid anchor in Europe has never
been greater: Hungary is increasingly in breach of community standards, while Slovakia is being rocked by a corruption scandal which may have unpredictable consequences. Meanwhile, Romania is perhaps only beginning to revolt against austerity.
In Ireland, arrangements to ensure that the pact can be adopted
without a referendum could backfire and undermine the bailout plan
established in 2010. Finally, with regard to Greece, everyone – with
the apparent exception of Angela Merkel and the troika negotiators –
is aware that, regardless of the inadequacy of national authorities in
the country, the population is close to breaking point.
In the middle of all of this, Germany is continuing to design the
Europe it wants to see, especially now that it has been “freed” from
the constraint of partnership with a domestically weak Nicolas Sarkozy,
while remaining reluctant to assume the new responsibilities thrust
upon it by the crisis.
The consequences of this state of affairs are not only economic, but
also cultural. Angry and impulsive outbursts have become increasingly
common, and allusions to Germany’s Nazi and Prussian past are more and
more prevalent in Europe. More insidious than economic and social ills,
the emergence of this trend and the renewed rise of nationalism are
cause for serious concern of a kind that cannot be allayed by a
budgetary pact.
Author
French journalist Eric Maurice, (b. 1972) is editor in chief of
presseurop.eu. After joining Courrier international in 2000, he was in
charge of the Paris weekly's France pages, before covering North
American affairs, and later becoming chief editor for Western Europe.
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Re: New EC Thread
Panda Sat 4 Feb - 18:12
Belgium
The recession hurts
After two consecutive quarters of negative
growth, Belgium is now officially in recession. Since the beginning of
the year, 2,000 jobs have been lost.
Original article in De Standaard
nl
Greece sold 2 yhr Bonds on Friday with 183% yield!!!! It is ridicoulous and the Country has to default.
The Dutch Government is not willing to help Greece out any more or take losses from Bonds.
The recession hurts
After two consecutive quarters of negative
growth, Belgium is now officially in recession. Since the beginning of
the year, 2,000 jobs have been lost.
Original article in De Standaard
nl
Greece sold 2 yhr Bonds on Friday with 183% yield!!!! It is ridicoulous and the Country has to default.
The Dutch Government is not willing to help Greece out any more or take losses from Bonds.
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Re: New EC Thread
Panda Sun 5 Feb - 8:45
4 February 2012
Last updated at 14:36
Europe 'at risk of early grave' warns Kevin Rudd
Europe is so
preoccupied with its own financial problems it is missing out on the
debate about Asia's rise, Australia's foreign minister says.
Kevin Rudd warned that Europe "runs the risk of talking itself into an early economic and therefore globally political grave".
Mr Rudd was speaking on the issue of "America, Europe and the rise of Asia" at the Munich Security Conference.
His comments were dismissed by the EU's internal market commissioner.
Michel Barnier said Europe would "emerge stronger and better organised from this crisis".
'Fundamental strengths'
Mr Rudd told the annual meeting of world leaders that Europe
had become sidelined from the debate about the growing economic and
political influence of China and Asia, the AFP news agency reports.
"Here in Europe, this continent has largely been missing in this debate, this should no longer be the case," Mr Rudd said.
"The danger that I see is Europe progressively becoming so
introspective and so preoccupied with its internal problems on the
economy and on the eurozone in particular that Europe runs the risk of
talking itself into an early economic and therefore globally political
grave".
"We don't want that. We actually think Europe has fundamental
strengths to deliver to the rest of the world but we are not seeing a
whole lot of that right now," he said.
Last updated at 14:36
Europe 'at risk of early grave' warns Kevin Rudd
Europe is so
preoccupied with its own financial problems it is missing out on the
debate about Asia's rise, Australia's foreign minister says.
Kevin Rudd warned that Europe "runs the risk of talking itself into an early economic and therefore globally political grave".
Mr Rudd was speaking on the issue of "America, Europe and the rise of Asia" at the Munich Security Conference.
His comments were dismissed by the EU's internal market commissioner.
Michel Barnier said Europe would "emerge stronger and better organised from this crisis".
'Fundamental strengths'
Mr Rudd told the annual meeting of world leaders that Europe
had become sidelined from the debate about the growing economic and
political influence of China and Asia, the AFP news agency reports.
"Here in Europe, this continent has largely been missing in this debate, this should no longer be the case," Mr Rudd said.
"The danger that I see is Europe progressively becoming so
introspective and so preoccupied with its internal problems on the
economy and on the eurozone in particular that Europe runs the risk of
talking itself into an early economic and therefore globally political
grave".
"We don't want that. We actually think Europe has fundamental
strengths to deliver to the rest of the world but we are not seeing a
whole lot of that right now," he said.
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Re: New EC Thread
Panda Sun 5 Feb - 11:05
Former Finance Minister for Greece, Petros Doukas has just been interviewed by Murnahan on sky News and revealed the following:-
Greece is in Depression.
The population is angry and confused and need a respite.
Charity is on the rise and often the poor are helping the poor.
Banks are more and more depleted because people are taking thier money out to live. (Probably to stash elsewhere I suspect)
Greece has implemented all the austerity measure demanded .
The Situation is very serious but while the Left wing Party leader Partris is saying 'let's default',Doukas says that would be even worse for Greece.
Greece is in Depression.
The population is angry and confused and need a respite.
Charity is on the rise and often the poor are helping the poor.
Banks are more and more depleted because people are taking thier money out to live. (Probably to stash elsewhere I suspect)
Greece has implemented all the austerity measure demanded .
The Situation is very serious but while the Left wing Party leader Partris is saying 'let's default',Doukas says that would be even worse for Greece.
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Re: New EC Thread
Badboy Sun 5 Feb - 11:54
IS THIS TRUE?
GREECE IS TO CLASSIFY PAEDOPHILIA AND PERHAPS KLEPTOMANIA ETC AS DISABILITIES COSTING LOTS OF MONEY.
HERE THERE ARE SAYING CUT DISABILITY BENEFITS IN GREECE TO CUT DEFICIT AND THEY ARE GOING TO PAY DISABILITY BENEFITS TO PAEDOPHILES ETC.
GREECE IS TO CLASSIFY PAEDOPHILIA AND PERHAPS KLEPTOMANIA ETC AS DISABILITIES COSTING LOTS OF MONEY.
HERE THERE ARE SAYING CUT DISABILITY BENEFITS IN GREECE TO CUT DEFICIT AND THEY ARE GOING TO PAY DISABILITY BENEFITS TO PAEDOPHILES ETC.
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Re: New EC Thread
Panda Sun 5 Feb - 12:13
Badboy wrote:IS THIS TRUE?
GREECE IS TO CLASSIFY PAEDOPHILIA AND PERHAPS KLEPTOMANIA ETC AS DISABILITIES COSTING LOTS OF MONEY.
HERE THERE ARE SAYING CUT DISABILITY BENEFITS IN GREECE TO CUT DEFICIT AND THEY ARE GOING TO PAY DISABILITY BENEFITS TO PAEDOPHILES ETC.
Hi Badboy, I don't know where you read that, but doubt it.This was a televised interview and I doubt the ex finance Minister would exaggerate. I
suspect the Banks are broke because of all the rich Greeks who have taken their money out of the Country, either buying properties in London or opening
off shore bank accounts.
It is inevitable that Greece will default , in a much worse position than they were two years ago.
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Re: New EC Thread
Panda Sun 5 Feb - 12:40
Badboy wrote:THERE WERE SAYING THAT ON THE OTHER FORUM.
Which Forum is that Badboy?? I think it is a joke because Greece has been notoriously bad for collecting Taxes, balancing it's Books etc. There
has been an extraordinary number of hits on this thread, maybe from Members you are quoting , can you give me the link and I will take a look.
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Re: New EC Thread
Panda Sun 5 Feb - 14:21
5 February 2012
Last updated at 12:38holds crucial talks over EU bailout plan terms
Austerity measures have already hit the living standards of many Greeks
Continue reading the main story
Global Economy
Greek
PM Lucas Papademos is set to meet the party leaders of his coalition to
try and win support for a proposed 130bn euros ($171bn; £108bn) EU
rescue.
Mr Papademos wants their backing for reforms demanded by the IMF and EU as a condition of the bailout.
Eurozone ministers had hoped to meet on Monday to finalise
the bailout, Greece's second, but that meeting has now been cancelled.
The money must be in place by mid-March if Athens is to avoid a debt default.
It is hoped Mr Papademos can reach a deal with party chiefs by Sunday night.
"The moment is very crucial," said finance minister Evangelos Venizelos on Saturday.
"Everything should be concluded by tomorrow [Sunday] night."
Athens faces loan repayments to private lenders of 14.4bn euros ($19 billion) on 20 March.
The BBC's Mark Lowen, in Athens, says Greece cannot afford to lose the bailout package and a lot now rides on these talks.
But, our correspondent says, that with potential elections in
April, the parties in Mr Papademos' coalition are wary about being seen
to be associated with the austerity measures being demanded by the EU.
'Great pressure'
EU officials have expressed frustration with Greece over
delays in backing the terms of the latest rescue package, which is being
put together by the European Union, the International Monetary Fund and
the European Central Bank - the so-called "troika".
"There is great impatience and great pressure not only from
the three institutions that make up the troika but also from eurozone
member states," said Mr Venizelos, after what he described a "very
difficult" conference call with his eurozone counterparts.
Reforms that international lenders want to see include a
lower minimum wage, the removal of a "13th and 14th month" extra salary
which is paid to workers as an annual bonus, and the liberalisation of
workplace regulations.
Opponents say that more cuts will worsen living conditions which have already been affected by two years of austerity measures.
Unless Greece promises to implement reforms, the eurozone
ministers say Greece will not be able to go ahead with a plan to
restructure its privately-held debt.
Greece has prepared a debt plan with private creditors to
halve the value of Greek debt and in return receive new, 30 year bonds
with an average interest rate of less than 4%.
The restructuring is to help cut Greek debt to 120% of GDP in 2020 from 160% now.
-------------------------------------------------
120% debt by 2020.!!!! Greece might as well default NOW It will be messy and Greece will face austerity for a few years , but if they come to terms with it, they will be better off.
Last updated at 12:38holds crucial talks over EU bailout plan terms
Austerity measures have already hit the living standards of many Greeks
Continue reading the main story
Global Economy
Why Greece won't go away
What caused the eurozone crisis?
How will the euro crisis end?
Crisis jargon buster
Greek
PM Lucas Papademos is set to meet the party leaders of his coalition to
try and win support for a proposed 130bn euros ($171bn; £108bn) EU
rescue.
Mr Papademos wants their backing for reforms demanded by the IMF and EU as a condition of the bailout.
Eurozone ministers had hoped to meet on Monday to finalise
the bailout, Greece's second, but that meeting has now been cancelled.
The money must be in place by mid-March if Athens is to avoid a debt default.
It is hoped Mr Papademos can reach a deal with party chiefs by Sunday night.
"The moment is very crucial," said finance minister Evangelos Venizelos on Saturday.
"Everything should be concluded by tomorrow [Sunday] night."
Athens faces loan repayments to private lenders of 14.4bn euros ($19 billion) on 20 March.
The BBC's Mark Lowen, in Athens, says Greece cannot afford to lose the bailout package and a lot now rides on these talks.
But, our correspondent says, that with potential elections in
April, the parties in Mr Papademos' coalition are wary about being seen
to be associated with the austerity measures being demanded by the EU.
'Great pressure'
EU officials have expressed frustration with Greece over
delays in backing the terms of the latest rescue package, which is being
put together by the European Union, the International Monetary Fund and
the European Central Bank - the so-called "troika".
"There is great impatience and great pressure not only from
the three institutions that make up the troika but also from eurozone
member states," said Mr Venizelos, after what he described a "very
difficult" conference call with his eurozone counterparts.
Reforms that international lenders want to see include a
lower minimum wage, the removal of a "13th and 14th month" extra salary
which is paid to workers as an annual bonus, and the liberalisation of
workplace regulations.
Opponents say that more cuts will worsen living conditions which have already been affected by two years of austerity measures.
Unless Greece promises to implement reforms, the eurozone
ministers say Greece will not be able to go ahead with a plan to
restructure its privately-held debt.
Greece has prepared a debt plan with private creditors to
halve the value of Greek debt and in return receive new, 30 year bonds
with an average interest rate of less than 4%.
The restructuring is to help cut Greek debt to 120% of GDP in 2020 from 160% now.
-------------------------------------------------
120% debt by 2020.!!!! Greece might as well default NOW It will be messy and Greece will face austerity for a few years , but if they come to terms with it, they will be better off.
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Re: New EC Thread
Badboy Sun 5 Feb - 14:31
JH FORUM.Panda wrote:Badboy wrote:THERE WERE SAYING THAT ON THE OTHER FORUM.
Which Forum is that Badboy?? I think it is a joke because Greece has been notoriously bad for collecting Taxes, balancing it's Books etc. There
has been an extraordinary number of hits on this thread, maybe from Members you are quoting , can you give me the link and I will take a look.
ALSO TYPE IN PAEDOPHILIA IN GOOGLE NEWS,APPEARS A FEW PLACES DOWN(SECOND PAGE)
PYROMANIACS ARE ALSO TO BE CLASSIFIED AS DISABLED PEOPLE.
THIS DECISION WAS TAKEN ABOUT 10 JANUARY 2012.
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Re: New EC Thread
Panda Sun 5 Feb - 14:37
Badboy wrote:JH FORUM.Panda wrote:Badboy wrote:THERE WERE SAYING THAT ON THE OTHER FORUM.
Which Forum is that Badboy?? I think it is a joke because Greece has been notoriously bad for collecting Taxes, balancing it's Books etc. There
has been an extraordinary number of hits on this thread, maybe from Members you are quoting , can you give me the link and I will take a look.
ALSO TYPE IN PAEDOPHILIA IN GOOGLE NEWS,APPEARS A FEW PLACES DOWN(SECOND PAGE)
PYROMANIACS ARE ALSO TO BE CLASSIFIED AS DISABLED PEOPLE.
THIS DECISION WAS TAKEN ABOUT 10 JANUARY 2012.
tHANKS bADBOY, i'M GOING TO WATCH THE rUGBY NOW BUT THINK IT IS A JOKE POST.
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Re: New EC Thread
Panda Mon 6 Feb - 0:55
5 February 2012
Last updated at 21:01
Greece talks over EU bailout end without agreement
The talks come as Greece faces a debt repayment deadline on 20 March
Continue reading the main story
Party
leaders in Greece's ruling coalition have ended talks on backing a
proposed 130bn euros ($171bn; £108bn) EU rescue plan without agreement.
Prime Minister Lucas Papademos was seeking the three party
chiefs' support for reforms demanded by the IMF and EU as a condition of
the bailout.
Mr Papademos had hoped to reach a deal with the leaders by Sunday night, but talks will now resume on Monday.
The money must be in place by mid-March if Athens is to avoid a debt default.
Eurozone ministers had hoped to meet on Monday to finalise
the bailout - Greece's second - but that meeting had already been
cancelled.
"Political leaders should give a response in principle
tomorrow [Monday] afternoon," Socialist Party (Pasok) spokesman Panos
Beglitis told Reuters news agency.
The leaders of the other two parties in the coalition said
after the end of Sunday's talks that they were still opposed to further
austerity measures.
"I am not going to contribute to a revolution that will
humiliate us and that will burn Europe", said Giorgos Karatzaferis,
leader of the far-right Laos party.
Antonis Samaras, leader of the conservative New Democracy
party, said the country was "being asked for more austerity, which it is
unable to bear," AFP reports.
Austerity measures have already hit the living standards of many in Greece
However, the BBC's Mark Lowen in Athens reports that Mr
Papademos's office has put out a statement saying some agreement was
reached on the reduction of public spending by 1.5% of GDP, and on bank
recapitalisation.
But there was no agreement on cuts to the minimum wage or to holiday bonuses, he said.
There seems to have been a meeting of minds on some issues,
but it remains to be seen whether this is enough to convince the EU and
IMF that Greece is committed to reform and to release the bailout funds,
he adds.
Greece cannot afford to lose the bailout package and a lot now rides on these talks.
Athens faces loan repayments to private lenders of 14.4bn euros ($19 billion) on 20 March.
'Great pressure'
Continue reading the main story Analysis
Mark Lowen
BBC News, Athens
Greeks have lived with austerity for much of the last two
years and the country is now in its fifth straight year of recession.
Unemployment is nudging 20%, businesses are closing and homelessness is
increasing.
Two of the three party leaders in the coalition say they are
still resistant to the new austerity measures. They fear that they could
be stabbing themselves in the back just weeks before possible early
elections in the spring.
The cost of failure would be extremely high. If Greece does
not reach agreement on these EU and IMF proposals, it could be staring
default in the face within weeks. That could send fresh shockwaves
through the global economy.
EU officials have expressed
frustration with Greece over delays in backing the terms of the latest
rescue package, which is being put together by the European Union, the
International Monetary Fund and the European Central Bank - the
so-called "troika" of lenders.
Reforms that international lenders want to see include a
lower minimum wage, the removal of a "13th and 14th month" extra salary
which is paid to workers as an annual bonus, and the liberalisation of
workplace regulations.
Opponents say that more cuts will worsen living conditions which have already been affected by two years of austerity measures.
Unless Greece promises to implement reforms, the eurozone
ministers say Greece will not be able to go ahead with a plan to
restructure its privately-held debt.
Greece has prepared a debt plan with private creditors to
halve the value of Greek debt and in return receive new, 30 year bonds
with an average interest rate of less than 4%.
The restructuring is to help cut Greek debt to 120% of GDP in 2020 from 160% now.
Last updated at 21:01
Greece talks over EU bailout end without agreement
The talks come as Greece faces a debt repayment deadline on 20 March
Continue reading the main story
Party
leaders in Greece's ruling coalition have ended talks on backing a
proposed 130bn euros ($171bn; £108bn) EU rescue plan without agreement.
Prime Minister Lucas Papademos was seeking the three party
chiefs' support for reforms demanded by the IMF and EU as a condition of
the bailout.
Mr Papademos had hoped to reach a deal with the leaders by Sunday night, but talks will now resume on Monday.
The money must be in place by mid-March if Athens is to avoid a debt default.
Eurozone ministers had hoped to meet on Monday to finalise
the bailout - Greece's second - but that meeting had already been
cancelled.
"Political leaders should give a response in principle
tomorrow [Monday] afternoon," Socialist Party (Pasok) spokesman Panos
Beglitis told Reuters news agency.
The leaders of the other two parties in the coalition said
after the end of Sunday's talks that they were still opposed to further
austerity measures.
"I am not going to contribute to a revolution that will
humiliate us and that will burn Europe", said Giorgos Karatzaferis,
leader of the far-right Laos party.
Antonis Samaras, leader of the conservative New Democracy
party, said the country was "being asked for more austerity, which it is
unable to bear," AFP reports.
Austerity measures have already hit the living standards of many in Greece
However, the BBC's Mark Lowen in Athens reports that Mr
Papademos's office has put out a statement saying some agreement was
reached on the reduction of public spending by 1.5% of GDP, and on bank
recapitalisation.
But there was no agreement on cuts to the minimum wage or to holiday bonuses, he said.
There seems to have been a meeting of minds on some issues,
but it remains to be seen whether this is enough to convince the EU and
IMF that Greece is committed to reform and to release the bailout funds,
he adds.
Greece cannot afford to lose the bailout package and a lot now rides on these talks.
Athens faces loan repayments to private lenders of 14.4bn euros ($19 billion) on 20 March.
'Great pressure'
Continue reading the main story Analysis
Mark Lowen
BBC News, Athens
Greeks have lived with austerity for much of the last two
years and the country is now in its fifth straight year of recession.
Unemployment is nudging 20%, businesses are closing and homelessness is
increasing.
Two of the three party leaders in the coalition say they are
still resistant to the new austerity measures. They fear that they could
be stabbing themselves in the back just weeks before possible early
elections in the spring.
The cost of failure would be extremely high. If Greece does
not reach agreement on these EU and IMF proposals, it could be staring
default in the face within weeks. That could send fresh shockwaves
through the global economy.
EU officials have expressed
frustration with Greece over delays in backing the terms of the latest
rescue package, which is being put together by the European Union, the
International Monetary Fund and the European Central Bank - the
so-called "troika" of lenders.
Reforms that international lenders want to see include a
lower minimum wage, the removal of a "13th and 14th month" extra salary
which is paid to workers as an annual bonus, and the liberalisation of
workplace regulations.
Opponents say that more cuts will worsen living conditions which have already been affected by two years of austerity measures.
Unless Greece promises to implement reforms, the eurozone
ministers say Greece will not be able to go ahead with a plan to
restructure its privately-held debt.
Greece has prepared a debt plan with private creditors to
halve the value of Greek debt and in return receive new, 30 year bonds
with an average interest rate of less than 4%.
The restructuring is to help cut Greek debt to 120% of GDP in 2020 from 160% now.
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Why does the euro mean so much to Germany?
By Bryony Jones, CNN
January 13, 2012 -- Updated 1549 GMT (2349 HKT)
German Chancellor Angela Merkel
has called on the countries of Europe to put their "national egotisms"
aside to find a solution to the continent's ongoing debt crisis.
HIDE CAPTION
Why the euro is so important to Germany
STORY HIGHLIGHTS
London (CNN) -- Germany has been at the very heart
of the European Union since it began 60 years ago as a way of pooling
coal and steel resources -- and of preventing future wars on a continent
already devastated by brutal conflicts.
But as the region's strongest economy, it has borne the brunt of the cost of recent rescue deals, and the country's troubled history has meant its insistence on unity is viewed with suspicion by some of its neighbors.
So why is Germany still so willing to do all it can to protect the
European Union? And will anything shake its faith in the euro?
Why does Germany play such a key role in Europe?
Germany was one of the founding nations of the European Union, which was designed to ensure that the continent would never again be torn apart by war.
Following World War II, Germany's neighbors wanted to hobble any
future attempts by the nation to remilitarize; the French decided that
the best way to do this was economically, rather than ideologically.
"France wanted to 'tame' Germany, and so the new Europe was built
around that Franco-German relationship, starting from a clean slate,"
said Professor John Loughlin, of Cambridge University's department of
politics and international studies
"Germany was completely devastated after the war, and that meant it
could begin again from scratch, build a new Germany, a new democratic
nation, using economic growth as the basis for that democracy.
"European integration became a part of that, part of the rehabilitation of Germany as a nation among nations."
How has Germany's economy performed over the years?
In the post-war years, West Germany enjoyed a massive boom, as the
nation made the most of the support it was offered and the opportunities
that came its way to recover from the devastation of WWII.
"The Marshall Plan money coming in helped, but Germany's
industriousness also played a big part," said Loughlin. "There is a very
strong work ethic, and the country has a large population -- it all
combined to allow Germany to re-emerge as a major power."
West Germany flourished in the 1950s, 60s and 70s -- the period of
the so-called "Wirtschaftswunder" [economic miracle] -- while other
European nations, including France and Britain, struggled.
But reunification with East Germany in 1990 following the fall of the
Berlin Wall and the collapse of the Soviet Union dented the country's
fortunes.
"The reunification of Germany impoverished the country to a certain
extent," said Loughlin. "The new Laender [regions] came in and resources
had to be transferred from rich regions to poorer ones."
"People forget that 10 to 15 years ago, Germany was going through a
crisis like those affecting Italy and Spain now," said Dr Alex Clarkson,
of King's College London's department of German.
Geithner keeps up pressure on Europe
EU leaders to decide Europe's future
S&P issues Europe debt crisis warning
World feels effects of eurozone crisis
"Back then, it was Germany that was seen as 'the sick man of Europe.'
The government had overspent, and had to make fundamental economic
reforms -- the system was close to paralysis.
"Of course in that case -- as in the case of Canada, South Korea and
others -- they were able to reform at the right time, when the going was
good. Spain and Greece have to make similar changes now, but of course
there is no growth to carry their economies forward."
And how strong is it now?
Germany has long been the economic powerhouse of Europe, but the nation is not immune from the global financial crisis.
It is the continent's largest economy, but it also has a high rate of government debt, at 83.2% of GDP, and higher unemployment -- at 7.1% -- than many of its neighbors, according to 2010 figures.
Much of Germany's might comes from its strong manufacturing sector,
which has meant that, unlike many of its neighbors, the country has not
had to rely on the financial services industry or the property market,
both of which have been badly hit by the global economic crisis.
But experts warn that Germany, which relies heavily on trade with
China, may be highly exposed to any future trouble in the Asian markets.
And Dr Christoph Meyer, senior lecturer in European and international
studies at King's College London, said despite its success so far, the
German economy was not bulletproof.
"There is a lot of uncertainty out there, because the world is facing
a wider recession, and in that case, who will buy German products?"
Is Germany propping up the euro?
"The short answer to that is yes," says Meyer. "If Germany was not
there as the anchor, offering stability, and with its economic weight --
as one of the world's most successful economies -- behind it, we would
not still be talking about resolving the crisis -- it would be over
already.
"But that doesn't mean Germany can do it alone."
Chancellor Angela Merkel has insisted even those outside the eurozone must do their bit to resolve the crisis.
What do ordinary Germans think of the crisis?
Experts say it is inevitable that there is a degree of resentment on
the part of German citizens, when faced with the responsibility of
clearing up another neighbor's mess.
"Most ordinary Germans are quite unhappy with having to bail out the
southern European countries, they aren't happy at having to give them
their money," said Meyer.
"But then most West Germans weren't happy about giving money to East Germans after reunification either."
He added that while the crisis had initially hit Merkel's popularity among voters, her approval ratings had risen in recent months.
How do other nations view Germany's actions?
The eurozone crisis has provided plenty of fodder for eurosceptic
media and politicians across the continent, with many press reports
feeding off old tensions and rivalries.
Loughlin said claims in anti-German sections of the media in Britain
and elsewhere that the country is "trying to take over Europe" were used
by politicians to boost their standing at home, but could do real
damage to international relations.
"It is a delicate situation, because there is a real risk of
inflaming old passions and resentments," he said. "Those knee-jerk
reactions can have major impacts -- we need statespeople, not mere
politicians, who can rise above it.
"The idea that German history is repeating, that there is some plot to take over Europe, is ludicrous.
"It comes down to how different countries view the European project
-- whether they see it as a market, like the British, the Swedes, the
Danes; or whether they see it as a grand political project to create a
new political system, like the Germans.
"Everyone is suspicious of each other, and that undermines any plan for greater integration."
Clarkson said Germany was in a Catch-22 situation.
"The Americans, and others, demand that Germany takes action, but
when they do, they are accused of trying to take over -- it is the curse
of power."
Is there a danger the eurozone crisis could derail Germany's economy?
"Germany has had a 'good recession' until now," said Meyer. "It has
benefited from the crisis so far, but now even Germany is having
difficulty selling bonds.
"The question is, at what point does the pain start for Germany? It is not hitting people's pay packets at the moment.
"But it is inevitable that the German economy will be hit. There will
be costs, be they the massive costs of a disorderly breakup of the
eurozone and a move to some other currency, or the -- still large --
costs of the bailout.
"There will be substantial costs, both short term and long term, to
allow the peripheral countries of the eurozone to catch up, and when
those come through there will be a growth of euroscepticism in Germany."
Why are Germany's leaders so committed to the euro, and how far will they go to protect it?
Experts say Germany is committed to the euro, and prepared to go to great lengths to protect it.
"Germany found it very difficult to give up the Deutschmark -- it was
a symbol of the country's recovery, and giving that up to join the euro
was a big sacrifice," said Loughlin.
But there are limits to the country's patience.
"It depends on the behavior of the other European partners," said
Meyer. "Germany is doing as much as it can, but the other nations have
to be reasonable, Germany can't help 'at any price.'
"The other countries need to be ready and willing to address their
problems, to make changes -- Merkel can't keep writing blank checks if
the conditions aren't being met.
"No-one wants to pour water into a leaking bucket forever."
By Bryony Jones, CNN
January 13, 2012 -- Updated 1549 GMT (2349 HKT)
German Chancellor Angela Merkel
has called on the countries of Europe to put their "national egotisms"
aside to find a solution to the continent's ongoing debt crisis.
HIDE CAPTION
Why the euro is so important to Germany
STORY HIGHLIGHTS
- Germany has been at the very heart of the European Union since it began 60 years ago
- As region's strongest economy, it has borne the brunt of the cost of recent rescue deals
- Deutschmark was seen as symbol of Germany's post-WWII recovery, move to euro a major sacrifice
- Germany keen to protect euro, but "no-one wants to pour water into a leaking bucket forever"
London (CNN) -- Germany has been at the very heart
of the European Union since it began 60 years ago as a way of pooling
coal and steel resources -- and of preventing future wars on a continent
already devastated by brutal conflicts.
But as the region's strongest economy, it has borne the brunt of the cost of recent rescue deals, and the country's troubled history has meant its insistence on unity is viewed with suspicion by some of its neighbors.
So why is Germany still so willing to do all it can to protect the
European Union? And will anything shake its faith in the euro?
Why does Germany play such a key role in Europe?
Germany was one of the founding nations of the European Union, which was designed to ensure that the continent would never again be torn apart by war.
Following World War II, Germany's neighbors wanted to hobble any future attempts by the nation to remilitarize; the French decided that
the best way to do this was economically, rather than ideologically.
"France wanted to 'tame' Germany, and so the new Europe was built
around that Franco-German relationship, starting from a clean slate,"
said Professor John Loughlin, of Cambridge University's department of
politics and international studies
"Germany was completely devastated after the war, and that meant it
could begin again from scratch, build a new Germany, a new democratic
nation, using economic growth as the basis for that democracy.
"European integration became a part of that, part of the rehabilitation of Germany as a nation among nations."
How has Germany's economy performed over the years?
In the post-war years, West Germany enjoyed a massive boom, as the
nation made the most of the support it was offered and the opportunities
that came its way to recover from the devastation of WWII.
"The Marshall Plan money coming in helped, but Germany's
industriousness also played a big part," said Loughlin. "There is a very
strong work ethic, and the country has a large population -- it all
combined to allow Germany to re-emerge as a major power."
West Germany flourished in the 1950s, 60s and 70s -- the period of
the so-called "Wirtschaftswunder" [economic miracle] -- while other
European nations, including France and Britain, struggled.
But reunification with East Germany in 1990 following the fall of the
Berlin Wall and the collapse of the Soviet Union dented the country's
fortunes.
"The reunification of Germany impoverished the country to a certain
extent," said Loughlin. "The new Laender [regions] came in and resources
had to be transferred from rich regions to poorer ones."
"People forget that 10 to 15 years ago, Germany was going through a
crisis like those affecting Italy and Spain now," said Dr Alex Clarkson,
of King's College London's department of German.
Geithner keeps up pressure on EuropeEU leaders to decide Europe's futureS&P issues Europe debt crisis warningWorld feels effects of eurozone crisis"Back then, it was Germany that was seen as 'the sick man of Europe.'
The government had overspent, and had to make fundamental economic
reforms -- the system was close to paralysis.
"Of course in that case -- as in the case of Canada, South Korea and
others -- they were able to reform at the right time, when the going was
good. Spain and Greece have to make similar changes now, but of course
there is no growth to carry their economies forward."
And how strong is it now?
Germany has long been the economic powerhouse of Europe, but the nation is not immune from the global financial crisis.
It is the continent's largest economy, but it also has a high rate of government debt, at 83.2% of GDP, and higher unemployment -- at 7.1% -- than many of its neighbors, according to 2010 figures.
Much of Germany's might comes from its strong manufacturing sector,
which has meant that, unlike many of its neighbors, the country has not
had to rely on the financial services industry or the property market,
both of which have been badly hit by the global economic crisis.
But experts warn that Germany, which relies heavily on trade with
China, may be highly exposed to any future trouble in the Asian markets.
And Dr Christoph Meyer, senior lecturer in European and international
studies at King's College London, said despite its success so far, the
German economy was not bulletproof.
"There is a lot of uncertainty out there, because the world is facing
a wider recession, and in that case, who will buy German products?"
Is Germany propping up the euro?
"The short answer to that is yes," says Meyer. "If Germany was not
there as the anchor, offering stability, and with its economic weight --
as one of the world's most successful economies -- behind it, we would
not still be talking about resolving the crisis -- it would be over
already.
"But that doesn't mean Germany can do it alone."
Chancellor Angela Merkel has insisted even those outside the eurozone must do their bit to resolve the crisis.
What do ordinary Germans think of the crisis?
Experts say it is inevitable that there is a degree of resentment on
the part of German citizens, when faced with the responsibility of
clearing up another neighbor's mess.
"Most ordinary Germans are quite unhappy with having to bail out the
southern European countries, they aren't happy at having to give them
their money," said Meyer.
"But then most West Germans weren't happy about giving money to East Germans after reunification either."
He added that while the crisis had initially hit Merkel's popularity among voters, her approval ratings had risen in recent months.
How do other nations view Germany's actions?
The eurozone crisis has provided plenty of fodder for eurosceptic
media and politicians across the continent, with many press reports
feeding off old tensions and rivalries.
Loughlin said claims in anti-German sections of the media in Britain
and elsewhere that the country is "trying to take over Europe" were used
by politicians to boost their standing at home, but could do real
damage to international relations.
"It is a delicate situation, because there is a real risk of
inflaming old passions and resentments," he said. "Those knee-jerk
reactions can have major impacts -- we need statespeople, not mere
politicians, who can rise above it.
"The idea that German history is repeating, that there is some plot to take over Europe, is ludicrous.
"It comes down to how different countries view the European project
-- whether they see it as a market, like the British, the Swedes, the
Danes; or whether they see it as a grand political project to create a
new political system, like the Germans.
"Everyone is suspicious of each other, and that undermines any plan for greater integration."
Clarkson said Germany was in a Catch-22 situation.
"The Americans, and others, demand that Germany takes action, but
when they do, they are accused of trying to take over -- it is the curse
of power."
Is there a danger the eurozone crisis could derail Germany's economy?
"Germany has had a 'good recession' until now," said Meyer. "It has
benefited from the crisis so far, but now even Germany is having
difficulty selling bonds.
"The question is, at what point does the pain start for Germany? It is not hitting people's pay packets at the moment.
"But it is inevitable that the German economy will be hit. There will
be costs, be they the massive costs of a disorderly breakup of the
eurozone and a move to some other currency, or the -- still large --
costs of the bailout.
"There will be substantial costs, both short term and long term, to
allow the peripheral countries of the eurozone to catch up, and when
those come through there will be a growth of euroscepticism in Germany."
Why are Germany's leaders so committed to the euro, and how far will they go to protect it?
Experts say Germany is committed to the euro, and prepared to go to great lengths to protect it.
"Germany found it very difficult to give up the Deutschmark -- it was
a symbol of the country's recovery, and giving that up to join the euro
was a big sacrifice," said Loughlin.
But there are limits to the country's patience.
"It depends on the behavior of the other European partners," said
Meyer. "Germany is doing as much as it can, but the other nations have
to be reasonable, Germany can't help 'at any price.'
"The other countries need to be ready and willing to address their
problems, to make changes -- Merkel can't keep writing blank checks if
the conditions aren't being met.
"No-one wants to pour water into a leaking bucket forever."
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Age : 67
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Warning :
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Greece crisis talks over EU bailout to resume
Panda Mon 6 Feb - 2:33
6 February 2012
Last updated at 02:20
Greece crisis talks over EU bailout to resume
Lucas Papademos (right) put on a brave face on Sunday, saying limited progress was achieved
Continue reading the main story
Party
leaders in Greece's governing coalition are to resume crisis talks on
backing a 130bn-euro (£108bn; $171bn) European Union rescue plan.
The meeting between PM Lucas Papademos and the leaders of three parties ended on Sunday without any deal.
The premier is seeking support for tough reforms as a
condition for the bailout. Athens needs the money by mid-March to avoid a
debt default.
Meanwhile, the German and French leaders are due to hold talks in Paris.
Chancellor Angela Merkel and President Nicolas Sarkozy - who
have worked closely on resolving the eurozone debt crisis - will take
part in a joint Franco-German cabinet session in the French capital.
'Unable to bear'
Many Greeks have been hit hard by austerity measures
Mr Papademos had hoped to reach a deal with the leaders by
Sunday night - but the talks ended without agreement on the painful
reforms demanded by the EU and also the International Monetary Fund
(IMF).
"Political leaders should give a response in principle
tomorrow [Monday] afternoon," Socialist Party (Pasok) spokesman Panos
Beglitis told Reuters news agency.
The leaders of the other two parties in the coalition said
after the end of Sunday's talks that they were still opposed to further
austerity measures.
"I am not going to contribute to a revolution that will
humiliate us and that will burn Europe", said Giorgos Karatzaferis,
leader of the far-right Laos party.
Antonis Samaras, leader of the conservative New Democracy
party, said the country was "being asked for more austerity, which it is
unable to bear," AFP reports.
However, the BBC's Mark Lowen in Athens reports that Mr
Papademos's office has put out a statement saying some agreement was
reached on the reduction of public spending by 1.5% of GDP, and on bank
recapitalisation.
But there was no deal on cuts to the minimum wage or to holiday bonuses, he said.
If there is no agreement, then Greece's international loan
will be blocked and the country would be staring default in the face -
something that could send shockwaves through the global economy, our
correspondent adds.
Athens faces loan repayments to private lenders of 14.4bn euros on 20 March.
Eurozone ministers had hoped to meet on Monday to finalise
the bailout - Greece's second - but that meeting had already been
cancelled.
Last updated at 02:20
Greece crisis talks over EU bailout to resume
Lucas Papademos (right) put on a brave face on Sunday, saying limited progress was achieved
Continue reading the main story
Party
leaders in Greece's governing coalition are to resume crisis talks on
backing a 130bn-euro (£108bn; $171bn) European Union rescue plan.
The meeting between PM Lucas Papademos and the leaders of three parties ended on Sunday without any deal.
The premier is seeking support for tough reforms as a
condition for the bailout. Athens needs the money by mid-March to avoid a
debt default.
Meanwhile, the German and French leaders are due to hold talks in Paris.
Chancellor Angela Merkel and President Nicolas Sarkozy - who
have worked closely on resolving the eurozone debt crisis - will take
part in a joint Franco-German cabinet session in the French capital.
'Unable to bear'
Many Greeks have been hit hard by austerity measures
Mr Papademos had hoped to reach a deal with the leaders by
Sunday night - but the talks ended without agreement on the painful
reforms demanded by the EU and also the International Monetary Fund
(IMF).
"Political leaders should give a response in principle
tomorrow [Monday] afternoon," Socialist Party (Pasok) spokesman Panos
Beglitis told Reuters news agency.
The leaders of the other two parties in the coalition said
after the end of Sunday's talks that they were still opposed to further
austerity measures.
"I am not going to contribute to a revolution that will
humiliate us and that will burn Europe", said Giorgos Karatzaferis,
leader of the far-right Laos party.
Antonis Samaras, leader of the conservative New Democracy
party, said the country was "being asked for more austerity, which it is
unable to bear," AFP reports.
However, the BBC's Mark Lowen in Athens reports that Mr
Papademos's office has put out a statement saying some agreement was
reached on the reduction of public spending by 1.5% of GDP, and on bank
recapitalisation.
But there was no deal on cuts to the minimum wage or to holiday bonuses, he said.
If there is no agreement, then Greece's international loan
will be blocked and the country would be staring default in the face -
something that could send shockwaves through the global economy, our
correspondent adds.
Athens faces loan repayments to private lenders of 14.4bn euros on 20 March.
Eurozone ministers had hoped to meet on Monday to finalise
the bailout - Greece's second - but that meeting had already been
cancelled.
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Re: New EC Thread
Panda Mon 6 Feb - 8:02
It appears the Greek Political Parties have finally agreed the austerity measures, not sure about the Bondholders %.
Christine La LGarde is off to Saudi Arabia to seek financial help of $500 million. the Saudi Finance Minister says things are a little complicated. Saudi wants
more volting rights as do other Countries who contribute to the IMF and it is believed they have formed a Group to strengthen their case.
Whatever happens in europe analysts believe China will not be unduly affected, although the IMF is suggesting that if the Euro crisis continues China
could be affected.
The Euro is in decline because of the delay in resolving the Greek Crisis.
The Bondholders are saying a deal must be reached today.
Stocks around Europe have opened lower , except for Ireland.
Christine La LGarde is off to Saudi Arabia to seek financial help of $500 million. the Saudi Finance Minister says things are a little complicated. Saudi wants
more volting rights as do other Countries who contribute to the IMF and it is believed they have formed a Group to strengthen their case.
Whatever happens in europe analysts believe China will not be unduly affected, although the IMF is suggesting that if the Euro crisis continues China
could be affected.
The Euro is in decline because of the delay in resolving the Greek Crisis.
The Bondholders are saying a deal must be reached today.
Stocks around Europe have opened lower , except for Ireland.
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Re: New EC Thread
Panda Mon 6 Feb - 9:29
Denmark's credit crunch worsening.
The Greek Government have got until tomorrow to agree the conditions of the Bailout, if they cannot, the Country will be bankrupt. It all depends on the
New Democratic Party agreeing to the new austerity measures.
An MP from the main Political Party says the measures demanded means another E3.1 billion austerity which will create more poverty. Instead of reducing
wages, savings could be made by reducing staff in Government departments, delaying projects , etc bureaucracy should be the way, not reducing the
minimum wage.
Britain will be affected by the transaction tax imposed by France.
La Garde has returned from Saudi Arabia, no indication on whether the Country will lend the $500 Billion . It is thought the price will be more votes, which would mean taking votes from existing EU Countries . It is understood Saudi Arabia is involved with other Countries wanting more say .
The world is changing and emerging nations wanting their say.
The Greek Government have got until tomorrow to agree the conditions of the Bailout, if they cannot, the Country will be bankrupt. It all depends on the
New Democratic Party agreeing to the new austerity measures.
An MP from the main Political Party says the measures demanded means another E3.1 billion austerity which will create more poverty. Instead of reducing
wages, savings could be made by reducing staff in Government departments, delaying projects , etc bureaucracy should be the way, not reducing the
minimum wage.
Britain will be affected by the transaction tax imposed by France.
La Garde has returned from Saudi Arabia, no indication on whether the Country will lend the $500 Billion . It is thought the price will be more votes, which would mean taking votes from existing EU Countries . It is understood Saudi Arabia is involved with other Countries wanting more say .
The world is changing and emerging nations wanting their say.
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Re: New EC Thread
Panda Mon 6 Feb - 11:32
The Greek austerity marathon
Comments (42)
PM Lucas Papademos chaired marathon talks on Sunday
Related Stories
For months the Greek government has been negotiating over the terms of a second bailout. Deadlines and ultimatums are announced but come and go.
A date is approaching, however, when - if there isn't a deal -
Greece faces bankruptcy. On 20 March Greece has to find 14bn euros
(£12bn; $18bn) to service its debts. As things stand it does not have
the funds.
Before it can contribute more to Greece, the IMF
is obliged to show that the country's debts are on a sustainable path.
By 2020, they want the country's debt to GDP ratio to have dropped from
the current 160% to 120%.
There have been two strands to the negotiations.
First of all, private investors - mainly the banks - have
been asked to accept losses of up to 70% on their investments. That
should wipe 100bn euros from the Greek debt mountain of 360bn. The
investors would exchange bonds for new ones worth less than half the
value. They would not mature for 30 years.
There have been arguments over what interest rate these investors would settle for and that has caused some delay.
Election factor
But everything depends on the second part of any deal - agreement to further reduce Greek government.
Greek public sector employees have staged a series of protests against proposed austerity measures
The EU and the IMF have been exasperated that commitments made in the past have not been lived up to.
They want to see the Greek deficit reduced more swiftly - so
they have been seeking further cuts of nearly 4bn euros. Their targets
include cuts to the minimum wage, large lay-offs from the civil service,
some cuts in pensions and a reduction in holiday payments.
Antonis Samaras, the leader of the second largest party, said
on Sunday the measures would only deepen the recession and promised to
oppose them "with all means".
Another of the party leaders, George Karatzafaris, said: "I
will not contribute to the explosion of a revolution due to misery that
will burn all of Europe."
Yet there is agreement to cut spending in principle and further talks will follow Monday.
The political leaders face elections in the months ahead, and
are reluctant to be cast as the authors of further austerity. This is
the fifth year the Greek economy has been contracting.
Faith lost
Europe's leaders, and in particular the Germans, have been
putting the squeeze on the Greeks. They have made it clear they are
running out of patience with them.
German Finance Minister Wolfgang Schaeueble said that "unless
Greece implements the necessary decisions and doesn't just announce
them - there's no amount of money that can solve the problem".
The Germans - and others - no longer believe the Greeks when
they say they say they'll implement reforms. They want commitments in
writing.
The problem is that the Greeks - who want to stay in the
eurozone - have lost faith in austerity. They see their country in
economic freefall. A point may have been reached - and the IMF has
hinted at this - that further austerity measures may just be
counter-productive.
The most likely outcome to all this is that a deal will be concluded.
A Greek default is still feared in Berlin because of the risk
that the instability will spread and endanger other countries like
Portugal and Ireland.
Greece's political leaders, too, fear the chaos that might follow a default.
But already the European Commission has said that even if a second bailout package is agreed it may not be enough.
A further 15bn euros will have to be found either from eurozone governments or perhaps from the European Central Bank. And even more funding may be needed down the road if the will to implement the reforms has gone.
In a paper for the Centre for European Reform,
Katinka Barysch cites numerous examples of where the Greeks have failed
to deliver. The troika of the IMF, the EU and the ECB demanded that
Greece shrink its public sector by only replacing one out of every five
people retiring but "between early 2010 and mid-2011, the government
added 20,000 people to the public sector payroll".
A deal will buy time but Greece is a broken society with even
middle-class people turning up among the growing number of homeless.
Everyone knows that years of austerity lie ahead.
Your comments (42)
Article written by Gavin Hewitt
Comments (42)
PM Lucas Papademos chaired marathon talks on Sunday
Related Stories
For months the Greek government has been negotiating over the terms of a second bailout. Deadlines and ultimatums are announced but come and go.
A date is approaching, however, when - if there isn't a deal -
Greece faces bankruptcy. On 20 March Greece has to find 14bn euros
(£12bn; $18bn) to service its debts. As things stand it does not have
the funds.
Before it can contribute more to Greece, the IMF
is obliged to show that the country's debts are on a sustainable path.
By 2020, they want the country's debt to GDP ratio to have dropped from
the current 160% to 120%.
There have been two strands to the negotiations.
First of all, private investors - mainly the banks - have
been asked to accept losses of up to 70% on their investments. That
should wipe 100bn euros from the Greek debt mountain of 360bn. The
investors would exchange bonds for new ones worth less than half the
value. They would not mature for 30 years.
There have been arguments over what interest rate these investors would settle for and that has caused some delay.
Election factor
But everything depends on the second part of any deal - agreement to further reduce Greek government.
Greek public sector employees have staged a series of protests against proposed austerity measures
The EU and the IMF have been exasperated that commitments made in the past have not been lived up to.
They want to see the Greek deficit reduced more swiftly - so
they have been seeking further cuts of nearly 4bn euros. Their targets
include cuts to the minimum wage, large lay-offs from the civil service,
some cuts in pensions and a reduction in holiday payments.
Antonis Samaras, the leader of the second largest party, said
on Sunday the measures would only deepen the recession and promised to
oppose them "with all means".
Another of the party leaders, George Karatzafaris, said: "I
will not contribute to the explosion of a revolution due to misery that
will burn all of Europe."
Yet there is agreement to cut spending in principle and further talks will follow Monday.
The political leaders face elections in the months ahead, and
are reluctant to be cast as the authors of further austerity. This is
the fifth year the Greek economy has been contracting.
Faith lost
Europe's leaders, and in particular the Germans, have been
putting the squeeze on the Greeks. They have made it clear they are
running out of patience with them.
German Finance Minister Wolfgang Schaeueble said that "unless
Greece implements the necessary decisions and doesn't just announce
them - there's no amount of money that can solve the problem".
The Germans - and others - no longer believe the Greeks when
they say they say they'll implement reforms. They want commitments in
writing.
The problem is that the Greeks - who want to stay in the
eurozone - have lost faith in austerity. They see their country in
economic freefall. A point may have been reached - and the IMF has
hinted at this - that further austerity measures may just be
counter-productive.
The most likely outcome to all this is that a deal will be concluded.
A Greek default is still feared in Berlin because of the risk
that the instability will spread and endanger other countries like
Portugal and Ireland.
Greece's political leaders, too, fear the chaos that might follow a default.
But already the European Commission has said that even if a second bailout package is agreed it may not be enough.
A further 15bn euros will have to be found either from eurozone governments or perhaps from the European Central Bank. And even more funding may be needed down the road if the will to implement the reforms has gone.
In a paper for the Centre for European Reform,
Katinka Barysch cites numerous examples of where the Greeks have failed
to deliver. The troika of the IMF, the EU and the ECB demanded that
Greece shrink its public sector by only replacing one out of every five
people retiring but "between early 2010 and mid-2011, the government
added 20,000 people to the public sector payroll".
A deal will buy time but Greece is a broken society with even
middle-class people turning up among the growing number of homeless.
Everyone knows that years of austerity lie ahead.
Your comments (42)
Article written by Gavin Hewitt
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These are 2 comments from the 45 listed in the above Article
George Soros, who famously made £1 million when Britain came out of the ERM says the EU could break up over this crisis and Germany is asking too
much.
Niell Ferguson of Harvard University says the Political entity of the EU could be destroyed. Merkel is asking too much and even aome German Newspaper
are beginning to say the same. He believes that will default .
He also says the ECB is not the answer for the Banks.
The Chinese are watching with concern about what Draghi is doing with the ECB, the value of the Euro continues to go down.
- 4.
mchristo_98
5 Hours ago I
used to be proud for being Greek.Now feel like I have to apologise for
the fact that our politicians aren't "politically adults". I have big
anger as they have made us look like the most lazy-corrupted guys in th
world. But it is not all the Greeks like that.Now they are dealing with
poverty from one day to another. We and you are all being cheated...
-
+4 Comment number 5.
Oleg
5 Hours ago Greeks
are being pushed too hard to commit to further austerity measures at
this point. With so much at stake, namely the future of the Euro and the
financial stability in the eurozone, would it not be in everyone's best
interest to just give the Greeks some more time to carefully prepare
and implement whatever additional measures are needed in a more orderly
fashion? What's the rush?
George Soros, who famously made £1 million when Britain came out of the ERM says the EU could break up over this crisis and Germany is asking too
much.
Niell Ferguson of Harvard University says the Political entity of the EU could be destroyed. Merkel is asking too much and even aome German Newspaper
are beginning to say the same. He believes that will default .
He also says the ECB is not the answer for the Banks.
The Chinese are watching with concern about what Draghi is doing with the ECB, the value of the Euro continues to go down.
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Data Show Greece’s Debt Ratio Growing as Economy Shrinks
By DAVID JOLLY
Published: February 6, 2012
PARIS — Greece’s debt rose to 159.1 percent of its gross domestic product in the third quarter of 2011 from 138.8 percent a year earlier, according to data released Monday that illustrates the country’s worsening economic straits after two years of austerity budgets.
Multimedia
Interactive FeatureTracking Europe's Debt Crisis
Related
The data, reported by the European Union statistics agency Eurostat in Luxembourg as part of a new series, underscored the urgency of the talks continuing Monday in Athens, where Greek officials and international lenders were trying to reach agreements that would make possible the release of new financing to stave off a Greek default next month.
It was the realization in late 2009 that Greece had been hiding the true state of its public finances that set the European sovereign debt crisis in motion and left the future of the euro currency itself in jeopardy.
Two years of austerity measures have weighed on employment, with the jobless rate at 19 percent, and hurt government tax revenues. The economy is expected to show a contraction of 6 percent in 2011, the International Monetary Fund has estimated.
Shrinking the G.D.P. side of the equation makes it harder to bring down Greece’s debt ratio to a more manageable level, and adds pressure for additional taxes and spending cuts.
The E.U. has forecast Greece’s debt ratio for 2011 at 162.8 percent — far above the 60 percent that euro zone members are supposed to aim for. Negotiators are hoping to put the Greek economy on a footing that would bring it to 120 percent of G.D.P. by 2020, but even that figure is now in doubt.
Eurostat also said the debt ratios of the 17 euro zone nations as a whole rose to 87.4 percent of G.D.P. from 83.2 percent a year earlier. For all of the 27 European Union nations, the debt ratio rose to 82.2 percent from 78.5 percent.
Those averages remain below the roughly 100 percent for the United States and 200 percent for Japan.
Among the most indebted euro members, Italy’s debt ratio rose 0.5 point to 119.6 percent in the third quarter from a year earlier, though it did show progress in shaving down by 1.6 points from the second quarter of 2011. Portugal’s debt ratio rose 18.9 points from a year earlier, to 110.1 percent, while Ireland’s rose more than 16 points to 104.9 percent.
Eurostat, which had not issued such quarterly debt figures before, said the report was meant to complement annual data it already publishes.
A version of this article appeared in print on February 7, 2012, in The International Herald Tribune.
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The Greece Political Parties have reached a tentative agreement to accepting the troika (EU ECB IMF) demands which include a 1.5% cut of GDP,
reduction in minimum wage, reduction of Government Employees.
No agreement yet on Bondholders percentage.
Merkel and Sarkozy considering setting up seperate interest accounbt for Greece. Merkel says time is running out and Greece must make a decision soon. the tranche is due 20th March and most will be taken up with payments of Bonds. maturing.
German Factory orders increase outside the EU which again suggests Germany is enjoying the decrease in the value of the Euro while this crisis continues.
Investment Manager in the U.S. says most Firms have factored in the default of Greece because the Country is bust and faces stringent cuts to make
matters worse.
An Economist says everyone is fed up with the EU and Merkel/Sarkozy for the way this crisis has been handled and the cracks in the system have become fissures and only served to show how complicated the system is without a Central Bank and a Eurobond. Germany obviously doesn't want this because it suspects it will be forever putting money in to prop up the weaker Countries.
reduction in minimum wage, reduction of Government Employees.
No agreement yet on Bondholders percentage.
Merkel and Sarkozy considering setting up seperate interest accounbt for Greece. Merkel says time is running out and Greece must make a decision soon. the tranche is due 20th March and most will be taken up with payments of Bonds. maturing.
German Factory orders increase outside the EU which again suggests Germany is enjoying the decrease in the value of the Euro while this crisis continues.
Investment Manager in the U.S. says most Firms have factored in the default of Greece because the Country is bust and faces stringent cuts to make
matters worse.
An Economist says everyone is fed up with the EU and Merkel/Sarkozy for the way this crisis has been handled and the cracks in the system have become fissures and only served to show how complicated the system is without a Central Bank and a Eurobond. Germany obviously doesn't want this because it suspects it will be forever putting money in to prop up the weaker Countries.
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Portugal
Shopping in the troika era
6 February 2012
Cristina Sampaio
Since Portugal has been subjected to an austerity regimen
by the EU/ECB/IMF troika, Portuguese consumers have adapted their
habits. The crisis is pushing consumers to save but also to be more
creative.
Francisco Cardoso Pinto | Maria João Gago
"It's a scam to exchange one's car for the metro, and it's more
expensive. In the car you go quickly, with the rising price of metro
[fares], it's almost the same and I started using my car so rarely that
I've found myself with a flat battery," says Diana Ralha, a
communications consultant, summing up the feelings of those who have
had to adapt their habits to the crisis because their pocketbooks have
been hit.
No one voluntarily chooses to take longer to go to work or to spend
time at home preparing lunch for the next day at the office. When one
adopts such habits it's exactly because one does not have a choice. But
if it is out of necessity that many Portuguese are forced to change
their life style, it is also necessity that hones their ingenuity and
creativity. And some even find a positive side to the changes forced on
them.
Obviously, the most notable changes are in shopping habits, a domain
where a small tweak can reap major savings. Mariana Távora, a lawyer,
has made two changes in her outings to the supermarket. First of all
she stopped going once a month. "When I did that," she explains,
"because there was always something missing, I systematically had to go
back in the middle of the week and I systematically came out with a
few extra things bought on impulse. So now, I go shopping once a week".
The second change made by Mariana, and perhaps the most astonishing
one, concerns the time of day chosen to do the food shopping. Lunchtime
is "risky," she says. "I avoid going at lunchtime because when I'm
hungry, I always buy more – and more sweets," she explains, conscious
of the efforts she makes to avoid the "risk" of impulse buying.
Getting to better know the neighbourhood
Ana Oom, a teacher, has for her part, stopped shopping on internet.
"Getting delivered at home made me buy in larger quantities. I started
going to a smaller supermarket. I go more often but I'm always very
careful. I make more rational choices and when I reach the checkout
counter, I always know about how much I'm going to spend" she says.
The crisis is disrupting payment method habits. Bank cards, whether
debit or revolving credit cards, are used more parsimoniously.
Francisca Lourenço has even stopped using hers. "We realised that by
spending only money that we actually have, our budget is better managed
and better controlled," she says.
Diana Ralha has sacrificed her debit card to the crisis. "I no
longer buy anything by card," she explains, "Every other day, I pull
out €20 and make them last as long as possible. That allows me to
better manage my budget and to resist the temptation of buying whatever
trinket comes within the reach of my bank card".
When every cent is counted, store-brand goods and small markets
appear as the best asset of those who are tightening their belts. Small
stores run by immigrants, are often home to real deals, notes Diana
Ralha. "I buy all my fruit and vegetables from the Chinese green grocer
on my street who has incredibly low prices," she says. Others want to
defend domestic production during the crisis. Mariana Pessoa e Costa
only buys Portuguese fruit "to help our farmers. And when there are
none, I don't buy any fruit". They all seem to have in common the
buying store-brands tactic.
Clothing and transport are two budget lines on which it is
difficult, today, for the Portuguese to trim. Many say they recycle
clothing. This limits shopping outings and stimulates the creativity of
budding fashion designers.
Getting to better know the neighbourhood one has lived in for years
and being in better physical shape – these are two of the advantages
put forward by those Portuguese forced to walk more often and take
public transport in order to save on petrol costs. "It's good
physically and, in my case, it allows me to clear my head and to avoid
the stress induced by the concentration needed behind the wheel,"
argues Leonor Tenreiro, a creative writing teacher.
Finding new sources of revenue
But the Portuguese' "new" life does not consist of only savings. The
current economic situation seems to have stimulated, in some of them, a
taste for risk. Such is the case of Sandra Casanova and her husband
who opened a bakery two years ago. "We were born of the crisis and it
certainly was a competitive edge for our project," she says.
Inês Custódio also chose to blaze new professional trails. "While
this crazy crisis was in full swing, I decided to leave my job to start
a business. So that this choice wasn't totally crazy, I had to make
even more savings. I managed to sell my house with a small profit, I
paid back the credit and now I rent a smaller, cheaper apartment," she
explains.
New projects aside, the Portuguese are returning to tried and true
methods. On-line sites like OLX and Custo Justo [Right Price] are often
mentioned as good ways to improve the family's resources. "I
discovered that I could earn a lot of money by selling the children's
things and all sorts of objects on internet. I even managed to sell the
youngest child's stroller for more than I bought it," says a satisfied
Diana Ralha.
The goals set by many Portuguese, whatever the solutions they find
in these times of austerity, are finding new sources of revenue and
cutting back expenses by adopting new shopping habits. If they do so,
it is because they don't have a choice. Those that we met manage,
little by little, to elude the crisis because they are not in a
desperate situation. But those that see the bright side of these
life-syle changes remain rare.
Translated from the Portuguese by Julie Marcot
Shopping in the troika era
6 February 2012
Cristina Sampaio
Since Portugal has been subjected to an austerity regimen
by the EU/ECB/IMF troika, Portuguese consumers have adapted their
habits. The crisis is pushing consumers to save but also to be more
creative.
Francisco Cardoso Pinto | Maria João Gago
"It's a scam to exchange one's car for the metro, and it's more
expensive. In the car you go quickly, with the rising price of metro
[fares], it's almost the same and I started using my car so rarely that
I've found myself with a flat battery," says Diana Ralha, a
communications consultant, summing up the feelings of those who have
had to adapt their habits to the crisis because their pocketbooks have
been hit.
No one voluntarily chooses to take longer to go to work or to spend
time at home preparing lunch for the next day at the office. When one
adopts such habits it's exactly because one does not have a choice. But
if it is out of necessity that many Portuguese are forced to change
their life style, it is also necessity that hones their ingenuity and
creativity. And some even find a positive side to the changes forced on
them.
Obviously, the most notable changes are in shopping habits, a domain
where a small tweak can reap major savings. Mariana Távora, a lawyer,
has made two changes in her outings to the supermarket. First of all
she stopped going once a month. "When I did that," she explains,
"because there was always something missing, I systematically had to go
back in the middle of the week and I systematically came out with a
few extra things bought on impulse. So now, I go shopping once a week".
The second change made by Mariana, and perhaps the most astonishing
one, concerns the time of day chosen to do the food shopping. Lunchtime
is "risky," she says. "I avoid going at lunchtime because when I'm
hungry, I always buy more – and more sweets," she explains, conscious
of the efforts she makes to avoid the "risk" of impulse buying.
Getting to better know the neighbourhood
Ana Oom, a teacher, has for her part, stopped shopping on internet.
"Getting delivered at home made me buy in larger quantities. I started
going to a smaller supermarket. I go more often but I'm always very
careful. I make more rational choices and when I reach the checkout
counter, I always know about how much I'm going to spend" she says.
The crisis is disrupting payment method habits. Bank cards, whether
debit or revolving credit cards, are used more parsimoniously.
Francisca Lourenço has even stopped using hers. "We realised that by
spending only money that we actually have, our budget is better managed
and better controlled," she says.
Diana Ralha has sacrificed her debit card to the crisis. "I no
longer buy anything by card," she explains, "Every other day, I pull
out €20 and make them last as long as possible. That allows me to
better manage my budget and to resist the temptation of buying whatever
trinket comes within the reach of my bank card".
When every cent is counted, store-brand goods and small markets
appear as the best asset of those who are tightening their belts. Small
stores run by immigrants, are often home to real deals, notes Diana
Ralha. "I buy all my fruit and vegetables from the Chinese green grocer
on my street who has incredibly low prices," she says. Others want to
defend domestic production during the crisis. Mariana Pessoa e Costa
only buys Portuguese fruit "to help our farmers. And when there are
none, I don't buy any fruit". They all seem to have in common the
buying store-brands tactic.
Clothing and transport are two budget lines on which it is
difficult, today, for the Portuguese to trim. Many say they recycle
clothing. This limits shopping outings and stimulates the creativity of
budding fashion designers.
Getting to better know the neighbourhood one has lived in for years
and being in better physical shape – these are two of the advantages
put forward by those Portuguese forced to walk more often and take
public transport in order to save on petrol costs. "It's good
physically and, in my case, it allows me to clear my head and to avoid
the stress induced by the concentration needed behind the wheel,"
argues Leonor Tenreiro, a creative writing teacher.
Finding new sources of revenue
But the Portuguese' "new" life does not consist of only savings. The
current economic situation seems to have stimulated, in some of them, a
taste for risk. Such is the case of Sandra Casanova and her husband
who opened a bakery two years ago. "We were born of the crisis and it
certainly was a competitive edge for our project," she says.
Inês Custódio also chose to blaze new professional trails. "While
this crazy crisis was in full swing, I decided to leave my job to start
a business. So that this choice wasn't totally crazy, I had to make
even more savings. I managed to sell my house with a small profit, I
paid back the credit and now I rent a smaller, cheaper apartment," she
explains.
New projects aside, the Portuguese are returning to tried and true
methods. On-line sites like OLX and Custo Justo [Right Price] are often
mentioned as good ways to improve the family's resources. "I
discovered that I could earn a lot of money by selling the children's
things and all sorts of objects on internet. I even managed to sell the
youngest child's stroller for more than I bought it," says a satisfied
Diana Ralha.
The goals set by many Portuguese, whatever the solutions they find
in these times of austerity, are finding new sources of revenue and
cutting back expenses by adopting new shopping habits. If they do so,
it is because they don't have a choice. Those that we met manage,
little by little, to elude the crisis because they are not in a
desperate situation. But those that see the bright side of these
life-syle changes remain rare.
Translated from the Portuguese by Julie Marcot
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| Feb 6, 1:41 PM EST Greece caves in on civil service firings By DEREK GATOPOULOS and NICHOLAS PAPHITIS Associated Press | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
ATHENS, Greece (AP) -- Greece's coalition government on Monday caved in to demands to cut civil service jobs, announcing 15,000 positions would go this year, amid mounting international pressure to agree on austerity measures needed to secure major new debt agreements. The announcement signals a shift in Greece's policy, as state jobs have so far been protected during the country's acute financial crisis, which started about two years ago. Public Sector Reform Minister Dimitris Reppas said the job cuts would be carried out under a new law that allows such firings. Unions have called a 24-hour general strike for Tuesday, in response to the new austerity measures, while about 4,000 protesters braved torrential rain late Monday to join protest rallies organized in central Athens by left-wing opposition parties. Greece is racing to push through painful reforms and clinch a euro130 billion ($170 billion) bailout deal from its European partners and the International Monetary Fund to avoid a March default on its bond payments. Debt-ridden Greece has been kept solvent since May 2010 by payments from a euro110 billion ($145 billion) international rescue loan package. When it became clear the money would not be enough, a second bailout was decided last October. Its implementation depends on the austerity measures but also on separate talks with banks and other private bondholders to forgive euro100 billion ($131.6 billion) in Greek debt, in exchange for a cash payment and new bonds worth 50 per cent less than the original face value, longer repayment terms and a cut in the interest rate to be paid on the bonds. Greek government officials say they expect private investors to take an overall cut of up to 70 percent on the value of their bonds. But delays in negotiations with rescue creditors pushed a crucial meeting of coalition party leaders back by one day to Tuesday. "We are opposed to indiscriminate firings," Reppas said. "The work force reduction is strictly connected with the restructuring of services and organizations at each ministry." Officials at the Public Sector Reform Ministry gave no details of the new plan, or say how many of the job cuts would be compulsory. The government has promised to reduce the 750,000-strong broader public sector by 150,000 by the end of 2015, but has so far insisted it could reach that target through staff attrition. Greece's coalition party leaders pushed back a key meeting by a day till Tuesday, due to the ongoing negotiations with EU-IMF debt inspectors who were to hold a new round of talks later Monday. They have already agreed to cut 2012 spending by 1.5 percent of gross domestic product - about euro3.3 billion ($4.3 billion) - improve competitiveness by slashing wages and non-wage costs, and re-capitalize banks without nationalizing them. Creditors are also demanding spending cuts in defense, health and social security, a cut in the minimum wage, as well as the civil service layoffs, as European pressure increased on Greece to make more concessions. European Commission spokesman Amadeu Altafaj Tardio said Greece is already "beyond the deadline" to end the talks. After talks in Paris with French President Nicolas Sarkozy, German Chancellor Angela Merkel said there can be no bailout deal unless Athens implements creditors' proposals. "(The proposals) are on the table," she said. "And time is pressing. Therefore something has to happen quickly." "Time is pressing and for the entire eurozone is much at stake," Merkel added. Greece is in its fifth year of recession, while unemployment has hit record highs of about 19 percent - following a spate of austerity measures in return for the rescue loans, that included significant cuts in pensions and salaries coupled with repeated tax hikes and an increase in retirement ages. "The current policy of austerity ... is turning workers into pariahs, jobless people and pensioners into paupers and deprives our youth of any hope," a statement from the servants' union ADEDY said. "This policy has already pushed Greeks beyond their limits and must be stopped at any cost." Yiannis Panagopoulos, leader of Greece's largest union, the GSEE, said the creditors' demands were certain to lead to more hardship. "What is going on is not a negotiation," he said. "It's blunt, cynical blackmail targeting an entire people." --- Sylvie Corbet in Paris and Raf Casert in Brussels contributed | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Life at 27
Institutions
Maastricht 20 years on: Eurocrat blues
6 February 2012
Le Temps
Geneva
Mayk
The European Commission and its civil servants gained
unprecedented powers with the signing of the Maastricht Treaty on
February 7 1992. Two decades later, the economy’s primacy over politics
and the advent of the crisis has destroyed their dreams and turned them
into scapegoats.
Richard Werly
Over the last year, the Schuman roundabout, at the foot of the
community institutions in Brussels, has been transformed into a
depressing urban shambles. In a decor worthy of an industrial park in a
hard boiled crime thriller, cranes, concrete mixers, and scaffolding
have taken possession of the administrative and political epicentre of
the European Union.
Delays already announced to the works, scheduled to continue until
2014, are a cruel symbol of the decline in the fortunes of the
eurocrats who reign over this part of city where the EU’s "founding
fathers" – Schuman of course, but also Jean Monnet, Alcide de Gasperi
and other less well-known figures such as Emile Noël, general
secretary of the Commission from 1967 to 1987 – are venerated. And
among such luminaries, one name is repeated more often than all the
others: Jacques Delors, the president of the EU executive from 1985 to
1995. On 7 February 1992, with the support of the Kohl-Mitterrand duo,
the former French government minister led the eurocracy out of the
darkness with the signature of the Maastricht Treaty on monetary union.
Obligation for transparency dragged Commission into abyss
Delors, remembered as a leader who stood his ground against heads of
state, charmed the press and embodied the union. Twenty years on, he
is still with us. On 7 February, he will be back in Brussels to
commemorate Maastricht. But the eurocracy no longer has the same fire
of those years. Far from it. Developments that followed 1992 –
enlargement to include 15 additional countries by 2007, French and
Dutch rejection of the ill-fated European Constitution in 2005, the
scramble to adopt the Lisbon Treaty and finally the financial crisis –
have been more than enough to douse the flame.
As the EU grew, doubts spread through the 13 stories of Berlaymont,
the Commission HQ which today is home from home for 27 Commissioners,
one from every country, and their staff. "With the enlargement from 15
countries to 27, we had to integrate 15, 000 new civil servants, of
whom a majority were from new member states. You can imagine the
shock," remarks a onetime member of the staff of Neil Kinnock, the
former British labour leader, who was the European Commissioner in
charge of administration in 2004.
Jean Quatremer, Brussel’s correspondent for French daily Libération,
argues that the "rupture" came earlier: to be exact in March of 1999,
the date of the mass resignation of the Jacques Santer Commission, which
had been rocked by scandals surrounding the French Research
Commissioner Edith Cresson.
The noughties became the decade in which the obligation for
transparency dragged the Commission into the abyss. Competitive
entrance examinations as thick as encyclopedias became the norm:
careerism was the new orthodoxy. English knocked out French to become
the majority language. The system was penetrated by lobbies, and the
export of European norms an exalted mission. The single market and
competition, raised to the rank of overweening priorities, enthroned
the primacy of economics and finance over politics.
The comfortable remuneration enjoyed by European civil servants
In destabilising the euro, the sovereign debt crisis struck at the
heart of the administration of the community, which had been made
impermeable to criticism by its stubborn esprit de corps. Diana, age
40, a unit head at the European Council, confirms: "The single currency
gave us a purpose but it killed our libido," she explains.
Explanation? "By identifying the EU with a currency, the
introduction of the euro neglected its values," adds writer Petros
Markaris, another Greek who is an adept of the Belgian capital. "the
emphasis on finance killed the comprehension of cultural diversity. We
abandoned the dream which was the only real community catalyst."
Today this situation has been compounded by personal complications
prompted by the crisis. Diana has become a whipping boy for her family
in Athens who are eager to vent their spleen over the "givers of
orders" in Brussels.
The poison? The comfortable remuneration enjoyed by European civil
servants – a minimum gross salary of 3500 euros at entry level, and
approximately 18,000 euros for ranked officials reaching the end of
their career – taxes capped at a very attractive rate (and returned to
the EU budget), scandalous offers of early retirement at age 50 with up
to 8,000 euros per month, the privileged world of European schools
reserved for their children, in Brussels or in Luxembourg… All the
characteristics of an overprotected elite that is impervious to the
convulsions of the markets.
Now another hurricane is threatening to fan the flames: the rise of
populism and nationalism. Scrutinised, envied, and vilified by the
press, European civil servants have become scapegoats, and they cannot
even count on their former colleagues to defend them.
"Today the lady is worn out and in bad shape”
Hypocrisy, complain the wounded bureaucrats, is the new order of the
day in national governments. Paris lambastes the salaries in Brussels,
while fighting tooth and nail to keep the seat of the European
parliament in Strasbourg. Luxembourg jealously guards the European
Court of Justice where the pay scales are quite simply unparalleled.
Member states are battling to become the location for community
"agencies" whose numbers have grown from 2 to 36 since 1992.
"The crisis has raised the crucial question of our legitimacy,”
admits a Commission senior official. In spite of the fact that they
speak several languages, many of our colleagues have lost touch with
reality in Europe. They are no longer an avant-garde which takes
risks, rather they form a nomenklatura, which, like like its
counterpart in the heyday of the USSR, is fearful of losing its
privileges."
True? Karel Schwarzenberg smiles. The head of Czech diplomacy, who
is also a Swiss citizen, was a supporter of the great Václav Havel. He
remembers the dismay of the former Czech dissident, an ardent supporter
of the Europe of ideas, the day he was confronted with the endless
array of grey offices in Brussels. "Do you think it can be a sexy
administration, especially when it does not speak your language and has
its seat thousands of kilometres from your home?" he asks.
Have the eurocrats fallen victim to the hazards of history? "Those
who joined up the 1960s served a fine young woman named Europe,
chortles the truculent Habsbourg prince. Today the lady is worn out and
in bad shape. And, just like us, she is not 20 years old anymore."
Translated from the French by Mark McGovern
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