THE BRUSSELS INCIDENT
THE GERMAN EURO CONSUMES GERMANY IN THE FIRE.
The German political class always knew they wanted a crisis to justify the final takeover of the nation states of Europe. A friend of mine heard a German Central Bank director say so. But Germany miscalculated and they have unleashed, not a crisis to justify more power over others, but a holocaust which will consume them as well.
Those who recall the film The Bedford Incident (where an American warship captain pursues a Russian submarine armed with nuclear weapons) will recognise the situation. His fanatical pursuit of his prey (in peacetime) has not just the submarine on edge but his own crew. He will listen to no advice. His argument with a fellow officer leads him to utter words which a crew member understands means “fire one”. The Russian submarine realises he will be wiped out and fires a nuclear weapon back. The bullying, cocksure American Captain is now speechless and powerless and the film ends in a mushroom cloud.
Eurozone politicians are like the about-to-be-annihilated American warship captain – powerless in the face of a destruction they brought on themslves. They know they cannot escape and they are turning on those (especially the British) who refused to kowtow to their imperial Euro. Those who warned them cannot now help.
The massive political power even they would need to make the final steps to create their empire out the rubble they caused is no longer available because their electorates have awoken to the truth, because the disasters are coming too quickly for them to act and the debt crisis has destroyed so many countries who now – thanks to the hideous Euro and EU rules – are prohibited from rescuing themselves.
Germany suffers from both skilled labour shortages and is approaching recession and high levels of debt. Germany is in danger of having its credit rating down graded along with France as the peripheral contagion they caused is washing like a tidal wave towards them.
A crisis is a problem where a natural democratic or market change was prevented. A grave crisis is a crisis where there is no way out – and that is now the case in the Eurozone.
1. The European Central Bank cannot finance weak European banks and weak European countries without seriously weakening its own balance sheet and without effectively usurping the democratic powers of Eurozone countries – to which Germans rightly object.
2. The European Financial Stability Fund cannot be expanded without seriously affecting France’s sovereign risk rating and the German Constitutional Court has said it would be illegal under the present German Constitution.
3. Unless European Banks get more capital they cannot withstand the necessary write down of Greek and other Eurozone debt (whether they exit the Euro or not) but if they are forced to raise more capital they will instead (or as well) reduce spending thus weakening any economic recovery and worsening the debt crisis.
4. If Greece and the other weak Euro-zone countries stay within the Euro their debt will be written down with large losses to banks but the problem will not have been solved, merely accommodated – at massive cost to future generations. Greece’s debt even after a 50% write down would still be a crippling 90% of GDP and trading within the Euro would ensure that burden would never be paid off.
The very existence of the Euro has caused the excess indebtedness of the weaker countries (through a decade of artificially low interest rates and a currency which does not reflect trade conditions). But it has also promoted the end crisis by denying Euro-zone countries currencies which could re-value or devalue, denying country appropriate interest rates, denying capital controls (as, for instance, Greece lost over 300 billion Euros in capital flight) and making people flight (as “European citizens”) all too easy from weaker countries.
Remarkably the ease with which Greek, Irish and Portuguese capital has fled those countries has been aided by the fact that Germany is now not just a corporate industrial powerhouse (its people are another matter) but also one of the world’s leading tax havens. So much for the 50 year old “common market” based on free trade.
All possible solutions to this self-inflicted disaster will be extremely costly but the preservation of the Euro is the “solution” which leads to irredeemable collapse.
German ambitions for the third time in 100 years have brought disaster to Europe and the world to the brink of collapse. For decades I have called this entire process EVIL because I knew the cost in terms of total human misery, jobless nihilism and destruction of freedoms which the “European project” would entail. That collapse, now imminent, justifies the term evil for those whose hubris brought us here. We must not forget their names. Indeed a list of the “guilty men” in Britain is available at www.freenations.freeuk.com/british-eurofederalists.html
RA 21st October 2011