There have been a few stories in the news this weekend that show the European Union being not so unified.
A couple of years ago, I’d have been saying how unfortunate that was.
Now, I’m seeing it as “good news”.
The reason for the shift is pretty simple: The European Parliament has begun acting as an Imperial Council and has essentially acted as though the Will Of The People was not only irrelevant, but worthy only of derision. ( I’ve actually watched a few sessions on Youtube, and it’s pretty clearly an ‘Insiders Club’).
So what were these things?
One was France saying that it might pull out of the Schengen Zone. I saw that go by in a ‘news crawler’ on CNBC World (a European / Asian oriented business news show on the satellite). As an American, I had not idea what a Schengen Zone was, but figured I ought to find out, since it rated coverage in a news crawler… It’s the “passport free” zone where EU folks can essentially wander around like Americans do between States.
Another was The Greek Bailout. Lots of Central Bankers and Ministers Of Money (or perhaps of Propaganda) seen on the news last week talking about how this was all Just Great and the problems were all fixed “This time for sure!”… Followed by a small news item that the agency responsible for such things had held that the restructuring of Greek Debt did, in fact, amount to a ‘default’ in that folks were not being paid fully and on time, but had to ‘roll over’ some of the maturing debt. Another news crawler said that this had triggered rather large payouts… A bit more to ‘dig into’ as actual amounts hit balance sheets.
Then there was the talk about “Who is next?” on the European Central Bank / IMF / German shopping list? Spain, Portugal, and Italy have all be mentioned, but folks figure Italy is just too big to handle. Portugal is the one most frequently at the top of the list. However, it looks like Spain is being the most cranky. In another thread, R. de Haan posted a link to a story that pretty well covers it. My only point is that it shows just how fragile the “commitment” to EU Membership is becoming.
Furthermore, Poland has said “not interested” in the Carbon Taxes and a sky full of non-EU countries are saying “nope” to the idea of a Carbon Tax on flying. China has just not quite managed to get around to giving the OK to buy a dozen or two Airbus Airplanes while they think about where they will be flying… With the USA, Russia, and China all on the same side on this one, it could get interesting…
For all their talk about “integration” and things like one Europe: Folks care about their country, their history, and their culture. Frenchmen do not wish to be Germans, Spaniards do not wish to act Dutch, Italians have little interest in being more English, and none of them want a load of foreigners just wandering in illegally.
In short, the EU is showing some fairly strong signs of stress fracturing. Only time will tell if this is the end of the beginning or the beginning of the end.
The links, for folks wanting to read some more:
France election 2012: Nicolas Sarkozy threatens to pull France out of Schengen zone
Nicolas Sarkozy threatened to pull France out of Europe’s passport-free zone on Sunday unless the EU tightened its borders against illegal immigration in a “make or break” campaign rally before 60,000 supporters outside Paris.
http://eureferendum.blogspot.com/2012/03/end-of-merkels-europe.html
But, it seems, it is not only what Rajoy has done, but the way he has done it – or, to be more precise – what he has been saying. Bearing in mind that the “colleagues” had just signed their fabulous new treaty, taking the eurzone closer to fiscal union, up pops Rajoy and says: “Democracy, national sovereignty and dignity of the states and their citizens in a democratic Europe that is said is much more important than the supposed ‘fiscal union’ of the EU”.
This is as close to farting in church as it gets, and what Ambrose finds striking is the wave of support for Mr Rajoy from the Spanish commentariat. One from Pablo Sebastián, he says, left me speechless.
“Spain isn’t any old country that will allow itself to be humiliated by the German Chancellor,” he writes – as loosely translated by Ambrose. “The behaviour of the European Commission towards Spain over recent days has been infamous and exceeds their treaty powers … these Eurocrats think they are the owners and masters of Spain”.
Bond holders of Greek debt, who have protected their investment by CDS insurance, might not get paid the money they lost, although ISDA set the CDS auction for March 19 after deciding on a credit event and therefore a trigger for the swaps. So, a $100,000 bond has now incurred a loss of $54K to its holder, replacing the rest with new bonds issued today. If that bond was insured by holding CDS though, the CDS payout that has now been triggered will be substantially lower than the incurred losses. Therefore hedging the bond’s risk will turn out to be an even worse investment and may lead to actually kill the sovereign CDS market according to Reuters!
http://news.yahoo.com/industry-group-finds-greek-deal-triggers-cds-payout-002540547.html
Industry group finds Greek deal triggers CDS payout
By Daniel Bases | Reuters – Fri, Mar 9, 2012NEW YORK (Reuters) – Greece’s debt swap deal will trigger the payout of insurance protection on the country’s bonds because of legislation that forced all private creditors to take losses, an industry group said on Friday.
The International Swaps and Derivatives Association said the decision by its EMEA Determinations Commission to declare a so-called credit event was unanimous.
The actual payout to creditors is likely to be less than the maximum of $3.16 billion of net outstanding Greek credit default swap contracts because bondholders are not losing all of their original investment.
“We do not foresee a significant impact from the Greek credit event on the financial markets. The amounts of exposure are relatively small,” Robert Pickel, chief executive officer of ISDA, said in a conference call with reporters. “They are known and they are very public, and most of this exposure (in the overall CDS market) is collateralized.
Markets showed little reaction to the widely expected decision. The euro edged lower against the dollar while U.S. Treasury prices pared losses in thin trading conditions after the announcement.
There was also a news story about various European and Asian airlines balking at the EU Carbon Taxes on airlines. Some folks were saying that might pull orders from Airbus (with numbers in the Billions of Euros being talked about) I’m also including here a link to a story about Poland balking at the Green Handcuffs as well:
http://www.bbc.co.uk/news/world-europe-17298117
China ‘blocks Airbus deals’ in EU carbon levy spat
China has blocked firms from buying planes made by European manufacturer Airbus in a row over a carbon levy, the firm’s parent company EADS has said.EADS chief executive Louis Gallois says Airbus is being subjected to “retaliation measures” by China. The EU levy took effect on 1 January, and will charge airlines for the amount of carbon dioxide (CO2) they emit. Beijing has not commented, and it is not clear whether it is official policy or a negotiating ploy, analysts say.
[…]
More than two dozen countries, including China, Russia and the US, have opposed the EU move, saying it violates international law.
So what say all those countries just don’t buy Airbus airplanes and don’t bother flying to Europe? Think anyone would notice? I think dropping off EU bound passengers in Morocco, Turkey, and wherever the nearest border to Russia might be, that would likely be “good for the soul”… Let them take the train instead…
I know that I will not be flying to Europe unless someone else pays the way. There are a lot of nice places in The Pacific, Asia, and Latin America that I’d like to see. Maybe in a decade or so I’d work in a Europe trip… on a rail pass based out of Switzerland…
Poland Says No…Blocks EU’s Climate Roadmap…Napoleon Hedegaard Vents She Won’t Stand For It!
By P Gosselin on 11. März 2012
Everybody say thank you to Poland.
It was the only of 27 European countries to reject the EU’s climate roadmap at a conference of Environment Ministers in Brussels Friday, angering environmentalists and EU climate protection expansionists.
GO Poland!! Go! Go! GO!!
I suspect we’re going to see a Polish / Slavic union forming on this front. Czech and Slovakia are likely to chime in too, IMHO. Russia has already said they see cold coming. Folks in that part of Europe know what cold is, and they know they are not feeling the warmth… Though I dare say it is starting to look like it is heating up in the EU Parliament…
Musings from the Chiefio 
As I recall our “Articles of Confederation” didn’t do so well either. Hummm… I’m sure British Bookies have already worked up the odds for “When will a European Constitution be adopted?” and “When, after the Constitution is adopted, will Europe have it’s Great Civil War/War of Northern Aggression?” Europe is a fascinating place, think we’ve learned to stay out and don’t touch when they’re having one of their little temper tantrums?
(I’m telling you guys, if it ain’t the floride in the water that’s driving people crazy, it’s the chlorine; or fertilizer they use in Mexico and S. America, somebody’s out to do us in and I think they’ve nearly done it too. Remember, we are what we eat;~)
Thanks, E.M.
Before leaving for St Louis this morning I hope to complete a short note on the long march to Climategate and economic collapse: “AGU, EU, NAS, RS, UN: Unity for Science and Society.”
Social insanity was driven by lock-step, consensus opinions championed by an unholy alliance of the AGU, EU, NAS, RS and the UN with world leaders frightened by the prospect of mutual nuclear annihilation.
Highly distorted scientific “facts” have caused great damage to society since Hiroshima was vaporized on 6 Aug 1945 and world leaders faced the reality of their mortality.
“For thirteen days in October 1962 the world waited—seemingly on the brink of nuclear war—and hoped for a peaceful resolution to the Cuban Missile Crisis.”
http://www.jfklibrary.org/JFK/JFK-in-History/Cuban-Missile-Crisis.aspx
Well, it is about who has more power, if the nice elite of bankers or the people (remember that they were who rated Greece as “AAA”), that´s the question for politicians: To be or not to be, because if they don´t take the side of the people they won´t be elected (a fact that causes deep pain in their empty souls) and if they do, they will hurt their bosses, their masters( a fact that would cause an unbearable pain in their pockets/wallets). Then…what to do?. Well, the only way out, is….cheating people.
Just don´t worry!….there are much more “interesting” things to witness this fateful year 2012….
Sarkozy is just doing some pre-election posturing. His power is being threaten by the Right Wing/Nationalists of Le Pen’s Front National, so he’s borrowed a few of their clothes to wear, until the elections are held.
After that, it’ll be business as usual.
The European Parliament, is thoroughly undemocratic. Members are elected via proportional representation, so the party favouite’s get in first. Any laws are formulated by committees, then passed onto the parliament for a rubber stamping.
More & more legislation is being introduced by qualified majority voting, whereby laws are imposed on all EU member states, if enough vote in favour.
They’re trying to breakdown the country base, by making trans-national divisions, so a political region of “Northern ……” will take a slice across Europe, from the Russian/Polish border, through to Northern England & Scotland, has been proposed.
The farce over Greece’s bankruptcy, has just been going on & on. The politicians can’t admit that the Euro is a dead duck, as that is their glue to stick together the entire, rotten, edifice. Go back through Richard North’s blog, http://eureferendum.blogspot.com/, for fuller details.
As an Englishman, I’ve little understanding of the US Presidential election system & I’ve no idea at all, who Mitt somebody is, how they’ve got to where they are today, not a clue what state they represent in what bit of government.
Must be even more puzzling for you Yanks, as to what’s going on in Europe!
Don’t be fooled by the European Parliament. It is a parliament only in name, to give some semblance of democratic legitimacy. In fact it cannot propose legislation, only rubber-stamp what comes from the bureaucrats. Speeches are limited to two minutes. There is no majority party in any meaningful sense, for the parties are national.
Cheery news. I hope the EU in its elitist un-representative-democratic version falls flat on its face. I have always been champion of Poland, and the Czechs. Next the UN. Next, all the authoritarians in the U.S. beginning at the top along with all his czars (how un-representative-democratic can one get?). Tea Party anyone? Thanks E.M. for this heartening news. Maybe the billions-trillions for “climate change” can go towards productivity and creativity for all for a change.
I don’t take anything serious than comes from Sarkozy.
It’s election time you know.
As for Greece, it is as bankrupt as can be.
The latest bail out was an attempt to create time to create a new constitution but the there are some complication which are severely undermining the EU.
1. http://www.zerohedge.com/news/greek-€107-billion-contingent-liability-gorilla-exposed
2. http://www.zerohedge.com/news/view-bridge-and-they-think-it’s-all-over…
3. Germany’s Plan B
http://www.zerohedge.com/contributed/2012-10-10/black-swan-no-one-talking-about-germany’s-“plan-b”
Russia in the mean time has announced it will close it’s air space for EU carriers unless the carbon flight tax is postponed or canceled.
Spain and Italy in the mean time have been confronted with massive deposit flight
http://www.zerohedge.com/news/ecb-masking-accelerating-deposit-flight-italy-and-spain
But I think the next country on the Default List is Portugal.
http://boombustblog.com/blog/item/6025-greece-is-trying-to-convince-portugal-to-make-the-fire-hot?tmpl=component&print=1
IMO the EU house of cards is collapsing and the process is accelerating.
Enjoy the show.
Do you remember a time when folks said “What is good for General Motors is good for the country.”? Many years later the Govt. has taken it over, screwed the bond holders, gave parts away, and now produce a car called the Volt.
Greece used to be a place people wanted to visit. Now the EU has taken it over, screwed the bond holders, and don’t know what to do with the parts left over. Just to rub salt in the wounds, the EU wants to make the vacation destination attributes even more expensive and less appealing. Sounds a lot like California, actually.
From the asian perspective Henry C.K Liu has a now five part series on the Eruozone Debt Crisis at the AsiaTimes On-Line: and a separate three part series on the European Sovereign Debt Crisis: “Head for the Euro Exit.
My shortest take on you first point about the nature of the European Union turning into a:
is that when you put the taxpayers of any one nation [Germany principally] too much on the hook for paying for the whole thing they are GOING to start acting like they own the place – because they will, and they won’t be too happy about the cram-down they are experiencing.
I am also reminded of watching Claude Chabrol’s 1993 documentary Eye of Vichy [L’Oeil de Vichy] and being taken aghast at how the collaborationist French swallowed bait of a ‘united Europe’ as the means of accepting the fascist yoke.
Europe will unite somehow, someday let the rest of us pray that the opium of that particular dream doesn’t send them blindly down the same rabbit hole it sent them seventy five years ago. I don’t think the smarter folks of the smaller more eastern nations will follow so easily. The Czechs in particular are pretty resistant to the notion.
W^3
E.M., the EU never once acted upon the will of the people. With the exception of the few convincing the many that they have shared interests. They don’t. The average man from Greece doesn’t have a damn thing in common with the average man in Britain. Then base this on some strange arbitrary, barely representative, form of government…. well, they’ll reap what they’ve sown soon enough.
The EU was a bad idea then, it is a bad idea now, and it will always be a bad idea.
‘… and none of them want a load of foreigners just wandering in illegally…’
Well to be fair, they have seen this happen quite a few times in the past and (if I remember correctly) each time it caused all sorts of trouble for a while.
More discomfort: Fed’s doomsday scenario bank stress test
http://www.cnbc.com/id/46709890
http://plus.cnbc.com/rssvideosearch/action/player/id/3000078341/code/cnbcplayershare
Chiefio,
You mention there are great places to visit besides Europe. May I suggest Montreal, Toronto, and Quebec? IMHO great cities in the European tradition and right close to home here in the US.
“Poland Says No…Blocks EU’s Climate Roadmap…Napoleon Hedegaard Vents She Won’t Stand For It!”
Poland got stung by the EU for supplying coal to electricity producers. Helping to keep this ‘unsustainable’ method of electricity generation cost effective. In Poland, implementation of an excise tax on coal sales was delayed until Jan 1, 2012 due to a transitional period when it joined the European Union.
Now the EU wants additional taxes levied on ships and air transport as these are highly polluting industries according to the EU. With all fuels duty in Europe generally very high by world standards, soon Europe will be that expensive but nice little backward place with lots of windmills, horse and cart transport, sail ships and no trade.
@GregO:
Oh, yes, how could I forget to mention the Northern USA? ;-)
There’s a story about that… Once, while driving to the Olympics in Montreal, a friend and I had crossed the border and were ‘into it’ about 1/2 a day. A house set back from the road had an interesting triangular window at a jaunty angle. Some cars were a bit different. Even some of the road signs…. I turned to my friend and, yes, I, me(!) said, from my very own mouth:
“I really like this. It looks interesting. It’s almost like a foreign country!”
After it left my lips, I heard it. Stammered a correction “But, of course it IS another country…” and undoubtedly got a little bit more pink…
Stayed with a French Canadian family. Found out that speaking French in class was not the same as living in it all day for days on end…. ( What do you call French Fries in French?… er…)
Loved the place. We crossed in at Toronto, eventually dropped down into northern Main. ( On a later trip the family and I did Vancouver to the back side of the Rockies. On a biz trip I did Calgary to the Rockies. I LOVE the Canadian Rockies…)
On my hypothetical “Bucket List” is to do a Blog Run starting at Prudhoe Bay Alaska (or as close as one can drive) and head diagonally down the Al-Can, to the Florida Keys… Letting folks choose particular destinations to visit / blog about via donations. (OK, I need $100 to get to Mount Rushmore or $40 for Yellowstone – place your donations or it’s gonna be Cow Ville Montana! ;-) I think it would be fun… Folks could basically ‘drive me around the continent’ via donations and destinations, and get postings of what I found or discovered…
At each point I’ve give a set of,. oh, a half dozen things ‘more or less’ along the way in the next couple of days, with costs / goals for each. Larger diversions from the general route taking more gas money (so if someone wanted to route me through New York City, they could, but at a larger gas and lodging donation). As I’d get closer to some place (like maybe going ‘near’ Yellowstone but not having yet had folks bid it up) the marginal costs would drop. So “Yellowstone from Nome” is a big number but “Yellowstone as I’m driving past the exit” is the entrance fee… As a site was “bid to completion” that path would be marked / published and then other ‘possibles’ get a new ‘price goal’. (So, for example, someone puts me in NYC, well, that Salt Lake City loop is going to go UP in costs…but the Washington Monument goes down…)
By starting in Alaska I’d guarantee a nice selection of Canada ;-)
Oh, and in Vancouver we had some great food. Lobster that was surprisingly cheap (likely from a large shoreline, not too many people, and USA having strange import limits, so the domestic Canadian price was quite economical). Saw the Steam Clock too… Sigh… I wanna go back!
Ah well… “Someday”…
@ E.M. A donation driven travel blog… Brilliant!
What if you did not even list possible locations to visit but let the donations be the complete arbiter? For example, people (or local businesses or whoever) could make a donation to be assigned a map location of their choosing, anywhere in the country. For each donation you assign a “force”, kind of like gravity (though maybe with an inverse linear equation instead of an inverse square.) As you reach each location, its donations (and their force) disappear from the map. Over time, the more distant locations have their monetary value build up and eventually you are pulled cross country.
This is very much like what you posited, but less structured. “Less structured?” Heck, not even structured at all. Seriously, even if you never do this, SOMEONE ought to, someone young, footloose and adventurous. Too bad they would not be as insightful as you though. :)
EM Many of us in the UK have been campaigning for the UK to leave the EU for more years than we care to remember. The EU is not democratic, and what’s more doesn’t even pretend to be. It’s just that we have been living in the age of stupid, where Politian’s created the conditions for the banks to behave stupidly, thereby bribing the populations of Europe into turning a blinded eye to their ultimate aim of Political Union. They have engineered a series of crisis’s that have provide the opportunity’s to move in small steps towards this aim. Regulation has destroyed competition and innovation in many areas. It’s a complete mess but much of the world is blind to its true nature, especially those in the US. We are now seeing the start of the disintegration of the EU, but one thing is certain, the colleagues and political elite will hold onto power for as long as possible, which is the exact opposite of what they should be doing in the interest of the citizens of Europe and will not only deepen any crisis but make the ultimate destruction all the worse when it comes.
I always thought that the US would lead the world out of the current malaise, but Obama has put paid to that. I don’t see a competent alternative getting chosen to replace him either. What’s wrong with you guys?????
@Jason Calley:
I could see “wide open” eventually (once volume was clearly working). Initially it would be a bit diffuse. If, say, 20 people all donate $20 for the place near them, nothing happens… If the choice is I-10 or I-80 headed East, then $200 gets me somewhere… Repeat… Once volume is high enough, somebody pops $800 for Nome, well, book a flight…
(The Nome example also shows how to deal with ‘weather issues’… in a slow and cheap start up phase you could find yourself being sent to Nome in December via car… with more volume it can be a ‘fly in and hotel’ trip that still works in December. So a ‘directed approach’ lets it start with me figuring out the logistical issues like snow in Nome… or hurricanes in Florida… )
Perhaps a hybrid would work best. A “directed section” for ‘soon’ and a ‘free area’ with a ‘someday’ schedule…
I’m “good to go” if folks vote for it, even if I’m not young and footloose but old, semi-retired, and rootless ;-)
@Peter Geany:
Somewhere around Nixon / Carter the USA became married to a EuroZone mindset. Endorsing the notion of ‘Regional Integration’. (Daddy Bush even wanted it for all of North America). It’s not just Obama, nor just the Europeans. We have a Globalist Agenda in charge of both.
So, sorry to say, you may be on your own in this one.
FWIW, I think the Slavs are going to be leading the way out of this particular darkness.
My advice? Resurrect the Commonwealth. The whole structure is still laying about. Shift the “regional integration” folks toward Commonwealth and they might not notice the bait and switch ;-)
Or just get Her Majesty The Queen to nullify the “EU Treaties”… It would force some kind of constitutional kerfuffle but that would be the opportunity to take the UK to the exit… Queen and Subjects vs The Eurocrats… I think it would play well in the nightly news…
A little off topic but you may find some little comfort to know that Germany went gungho for the renewable energy and now it’s costing them. They also closed their nuclear plants on unfounded fears following the Japanese Tsunami, so now they are burning more lignite (dirty brown coal) to make up the shortfall.
http://notrickszone.com/2012/03/15/germanys-per-kilowatt-hour-co2-emissions-jump-4-transformation-to-renewables-flops/#more-17463
@tckev as always in politics everyone talks with a forked tongue. The Germans only shut down the ones that were due to close anyway, and kept the others ticking over. This winter they had to start them up again.The will have to keep them going for some time unless they want to purchase power from other countries. The German People will not put up with that nonsense for very long if it costs them competitiveness and jobs. So far as in France and the UK the political classes have been able to cover their mistakes up.
Well, I guess the Germans, like the Americans, can be counted on to “do the right thing” (after they have exhausted all other options ;-)
[For all their talk about “integration” and things like one Europe: Folks care about their country, their history, and their culture.]
And us’n anti government, red state, wine swilling, self sustaining, damn the revenuers, non-entitlement, hard-working redneck types kinda like our culture too and feelen like seceding.
And i don’t need no sarc tags cousin EM n I go way back to bud commercials and he knows I wasn’t jesting r poking fun at anybody jes cuz I ‘s educated. I kinda get sick paying 52 % + of my saved and invested + dayjobs earnings (social security, medicare, federal and state income and local sales tax) to the gubments so entitled folks can have a better cellphone that my X yr old razor. Iyamwhatiyam
@Tim Clark:
There’s an interesting experience some few folks get to have. That of talking with a Southerner, Texan, or Country Redneck and thinking them “not so swift” due to the cadence of speech or the topic material ( like how best to prepare road kill…) then finding themselves completely flummoxed when said person says something like “Well now, I don’t think tha’ whole Dark Matter dog is gonna hunt. They got the causation wrong an’ didn’ allow for space bein’ full-o black holes from the first couple o’ crops o’stars expirein.”
This is especially so when major cities full of self righteous Govt Dweebs think they know more than said folks and ought to take their money to ‘use it better’…
It is one of the bits of cultural disconnect that I marvel at. These same folks who are all wound up in their whole ‘cultural awareness’ thing, can’t see their blindness to the fact that the folks who talk slow are thinking just as fast (or faster, spending less time on shuffling words…)
I suspect Europeans have a similar “issue” with some of American Culture and likely have the same “issue” internally. ( It may even be worse with Germans vs Greeks…)
So I’d be quite happy to join a Texas that was seceding and then ‘splain to the the northerners that it wasn’t their choice what kind of light bulb I had, when my toilet would work, who bought tabaccy and beer, or how I got a busted arm fixed. Frankly, I think I’d kind of enjoy it ;-)
In a related note: Sturm Ruger reported record profits from record gun sales in 2011. I’m sure its not related…