Tag Archives: european

Here We Go Again

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The Financial Times is running this story this morning:

“Britain is coming under pressure from the European Commission to say when it will honour its 25-year-old promise to go fully metric, converting miles to kilometres and pints to litres.G?nter Verheugen, EU enterprise commissioner, says he wants clarity on the issue, claiming he is facing pressure from British pro-metric campaigners to act.”

Isn’t this really the kind of silly non-issue the EU could safely live without? UK consumers and citizens have every right to purchase their beer in pints or measure their journeys in miles if they chose so to do. Trying to force them to change is not non-intrusive government. And the argument about pressure from the ‘pro-metric’ lobby is a canard: if they want to lobby, they should lobby inside the UK, and try and convince public opinion there, while Verheugen should have the strength of character to tell them to get lost in the meantime.

Incidentally, on this issue I have no strong feelings personally, since frankly my dear I couldn’t give a damn.

Update, here’s another example:

“The decision by the Netherlands to lock up 5.5m free-range birds as a precaution against the spread of avian flu may have breached European Union rules, it was claimed on Friday. The European Commission said its lawyers were studying whether the unilateral action was legal, since animal health is an EU matter and the Dutch action was taken before EU animal health experts had co-ordinated their response. Commission lawyers are also considering how long Dutch free-range egg producers should be allowed to market their products as such, following the decision to confine all poultry to sheds last week.”

It seems little has been learned from the referendum ‘sebacks’. What we are in danger of creating is an intransigent’s paradise. If the Dutch government can’t take the measures it sees fit to protect its citizens because it’s against the rules then it’s time to ammend the rules in question and not castigate the government of the Netherlands. This is the case whether or not it could be claimed that the government have ‘overreacted’.

ESA and Russia: Together into space?

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Interesting news (via Randy McDonald) concerning a partnership between the European Space Agency and Russia to develop the Russians’ new Kliper reusable space shuttle.

It’s all but official?Russia and Europe will soon embark on a cooperative effort to build a next-generation manned space shuttle. Speaking at the Paris Air Show, in Le Bourget, France, in June, Russian space officials confirmed earlier reports from Moscow that their partners at the European Space Agency would join the Russian effort to build a new reusable orbiter, dubbed Kliper. After the cautious optimism they expressed at the beginning of 2005, Russians are now confident that their European partners will be on board for the largest, boldest Russian endeavor in spaceflight in more than a decade.

Interesting to note that, in one of those strange coincidences, the leading designer of the Kliper system is called Vladimir Taneev – the same name as one of the leading characters in Kim Stanley Robinson’s Mars trilogy.

Merkel’s Reform Agenda

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Angela Merkel has an interview in the Financial Times today. Unfortunately the transcript is subscription only. This is a pity, since to some extent she defines the kind of Europe she would like to see:

In an interview with the Financial Times, Angela Merkel, leader of the Christian Democrat Union, on Wednesday issued a clarion call for economic reform in Europe based on countries borrowing successful policies from one another. ?If I look at Scandinavia, for instance, I see we still have a long way to go in decoupling our social security system from labour; if I look at central and eastern European countries, I see I still have a long way to go in reforming my tax system; and when I look at the UK, I see I still have much to do to make my labour market more flexible.?

Ms Merkel’s references to central European countries and to the UK are striking, since the former are identified with low corporate taxes and in some cases, such as Slovakia with a ?flat tax? system. The deregulated UK labour market is often demonised by continental European politicians as alien to the European social model.

Her remarks provide clear backing for Tony Blair, prime minister and current holder of the EU’s rotating presidency, in his campaign to put economic reform at the centre of the EU’s effort to reconnect with European voters after their rejection of its planned constitution in France and the Netherlands in the past two months.

The big difficulty I see with her proposals is that they will put more of the burden of financing government on consumer taxes (VAT), and this will not help Germany lift domestic consumer demand which is one of the ‘big issues’.

Morgan Stanley economist Elga Bartsch, who I have in the past maligned somewhat here on this blog, has a pretty fair and balanced summary of the CDU reform programme here.

Something Worries Me About Peter Bofinger

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Really I realise I have been remiss in another important sense. I have long assumed that in fact the decision to reduce deficits was taken due to the coming fiscal pressure from ageing. This certainly was the background to the discussion. However now I look at the details of the SPG this area is not mentioned (as far as I can see) and the other – the free rider and associated – is the principal consideration.

So those who criticize the bureaucratic and infexible nature of the ECB are in the right to this extent. Of course the underlying demographics *should* be part of the pact, but that is another story.

I find myself in a tricky situation, since I am deeply sceptical that the euro can work, and now after the French vote even more so, but since it has been set in motion, the best thing is obviously to try and make it work (even while doubting). So I am thinking about all this. Obviously I should try and write a longer post making this clearer.

The SGP was adopted at the Amsterdam Council 1997. A history of the implementation of the pact, and a summary of the debate over the new pact can be found here. The Stability and Growth Pact was designed as a framework to prevent inflationary processes at the national level. For this purpose it obliges national governments to follow the simple rule of a balanced budget or a slight surplus.

Now if we go back to the origins of the pact, to the communication of the European Commission on 3 September 2004, you will find the following:

“As regards the debt criterion, the revised Stability and Growth Pact could clarify the basis for assessing the “satisfactory pace” of debt reduction provided for in Article 104(2)(b) of the Treaty. In defining this “satisfactory pace”, account should be taken of the need to bring debt levels back down to prudent levels before demographic ageing has an impact on economic and social developments in Member States. Member States’ initial debt levels and their potential growth levels should also be considered. Annual assessments could be made relative to this reference pace of reduction, taking into account country-specific growth conditions.”

Now curiously I have found nothing in Bofingers argument which seems even to vaguely recognise this background.

A good starting point for this topic would be the conference “Economic and Budgetary Implications of Global Ageing held by the Commission in March 2003.

The European Council in Stockholm of March 2001
agreed that ?the Council should regularly review the
long-term sustainability of public finances, including the
expected strains caused by the demographic changes
ahead. This should be done both under the guidelines
(BEPGs) and in the context of the stability and
convergence programmes.?

This document on the history of EU thinking on ageing and sustainability is incredible.
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Two on Turkey

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With Turkish accession one of the most important issues facing the European Union, people interested in the question could do much worse than read these two recent, and reasonably short, books that focus on the country: Crescent and Star, by Stephen Kinzer, and The Turks Today, by Andrew Mango. Both illustrate and explain contemporary Turkey, and both have accession as a theme throughout their books.
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On Predictability.

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While the entire world is admiring Londoners for their ability to not let the terror destroy their way of life, while London mayor Ken Livingston is taking the Tube each morning, because not doing so would prove the terrorists strategy right, the British government is reinforcing its ongoing quest to get hold of as much information about citizens as possible. I’d call it “opportunistic”, they’d call it “concerned”.
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More Theories

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Very hard to interpret the information we are receiving right now. Much of it may well be aimed at the terrorists themselves so it is also perhaps better not to dig too deeply.

There are, however, a number of rival (but possibly) compatible theories. One of these, and it is the one I am following most closely (possibly for obvious reasons) is that of the Spanish connection. Now following this along the road a little (and just in a kind of ‘what if’ sense) it may not be entirely without relevance that raids were carried out in Italy on Saturday. (The FT today also also has a piece on the Italian raids. What stands out is the ‘cover’ provided by mass illegal immigration for such groups. I am in favour of increasing economic migration to meet demographic needs, but this process needs to be regulated and orderly, here we can see one more reason why). It is just me speculating, but the rapidity of the raids in Italy may relate more to the fact that there are ties between the Spain-based Jihadists and the Italian-based ones than to the immediate threat of an attack in Italy. This article contains the following information sourced from the Italian newspaper Corriere della Serra:

“In 2003, the Italian Police and the carabinieri from the Special Operations Unit uncovered a link between the alleged Italian cell and its extremist associates in a number of European countries, primarily Germany, Spain, and the Netherlands. The Milan probe revealed that “young North Africans were ?trawled for’ in the European mosques, given money, and supplied with a visa?” to travel to Iraq to conduct suicide operations.”

This connection is loose, but is one possible route. Those who feel there might be an Iraq connection (and the lack of any explicit information about the explosives might point to this: this origin would be politically sensitive) would do well to note that the Italian net appears to have close links with Ansar Al-Islam which is based in the Kurdish zone, and was once host to none other than Abu Musab Al-Zarqawi. As I say, I wouldn’t even call this a conjecture, just some isolated pieces of information which are worth keeping track on, irrespective of whether or not the people mentioned were implicated last Thursday.

Finally, the NYT highlights the way in which the kind of terror we are seeing is in fact bringing Europe closer together:
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Naive musings

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I have been trying to write something informative on the current budgetary crisis in the EU. After reading countless articles I have come to the conclusion that there is nothing worthwhile I could add to the discussion. Confusion reigns supreme in this little European?s head and economics have never been my forte – certainly not when mixed with politics. Just check out some of the comments made by readers of BBC News. Anyhow, I deleted everything I had written so far and decided to bring your attention to this (from New Europe):

Each year, more than a billon Euro worth of funds transferred by the European Union to its 25 member states are either misspent or lost, according to a European Parliament (EP) report cited by INEP last week. (?) Asked which countries are the most prone to fraud and irregularities, Buttice failed to give a clear-cut answer. But based on number of cases of fraud and irregularity reported by EU member states for 1999-2003, big EU countries such as Italy, Germany, Spain, France and the United Kingdom are the prominent ones.

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Charting the European Blogosphere.

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Actually, I’m not entirely sure there is a European blogosphere yet, as most blogospheres seem to develop in their respective linguistic markets, complemented by a couple of English language (non UK) blogs operating in the same markets. Thus, the European blogosphere, narrowly defined, is still a rather tiny community.
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