24 January, 2014

Euro11: Ombudsman condemns European Council cover-up on legality of euro's Fiscal Compact

Maladministration on a grand scale! Who controls multi-billion funds that dwarf the EU’s annual budget by three or four times? Who ultimately controls the multi-trillion stranglehold that the Brussels institutions have on the budgets of national governments in the EU?  Who controls the Bank? Why are such mega projects excluded from Court action for fraud and crimes that the euro crises have already exposed across the whole euro zone?

If you thought some fiddling by MEPs or even small States like Greece, Portugal, Cyprus or Ireland was of concern, take a stiff coffee before reading on.

The European Ombudsman, Emily O’Reilly, has condemned the European Council and its secretariat in the Council of Ministers of maladministration for a cover-up and refusal to provide promptly legal information for public discussion on the  Fiscal Compact Treaty controlling Europe’s multi-trillion euro economy. The documents, essential for a proper democratic debate and consultation were requested two years ago in January 2012.

In spite of the Ombudsman’s ruling, the documents in question have still not been provided.

The Fiscal Compact is an international treaty and has not been signed by two Member States. Both the Czech Republic and the United Kingdom refused. Its relationship to the EU justice system is therefore questionable. For the European Court to act all Member States must have the measures agreed by democratic vote in a European treaty of all Member States. Then all the European institutions have their right to discuss and amend the treaty. The Council, Parliament, Consultative Committees all elected by democratic vote have to have their imput and rights on individual decisions and measures undertaken. The Commission should have clear independence. It should not be treated like a skivvy or slave of the Council of Ministers. It is not their Secretariat! Then the European Court of the EU can make its judgements when their is a complaint from any citizen, organization or State.

Signatories of an international treaty conversely, for example, NATO or the Council of Europe, cannot ask the European Union’s Court of Justice in Luxembourg to make judgements for them.

So what is the status of the Fiscal Compact?

It spends nearly half of its many pages with a Preamble with many indents or tear-jerking appeals of its Europeanness: Conscious of this, Desiring that, Recalling this that and the other of European goals and even institutions. The truth is it is not a part of the European Union or the Community. It is a separate international treaty, fixed up by some politicians in a fix. They have used all the lawyers’ skills and deceits to give a facade that it is part of the European legal system, as best they can. But they can’t. There are two members missing and only treaties inside the Community system embracing all members are EU legal treaties.

How can outraged European citizens or duped Member States appeal if other States do not comply with the Compact’s strictures? What can anyone do if some politicians treat the other States as financial patsies? That is just what the monetary crises in Greece, Spain, Portugal, Italy and Ireland and others are all about. The public’s conclusion is obvious. Some politicians are not honest, nor do they act honestly with the people’s money. Money deranges their judgement. They treat it as a slush fund to dole out to people they hope will vote for them. If they can’t get away with it at home or run out of money they tap into the prosperous countries that keep their books in order and have a surplus.

The full title of the Fiscal Compact is Treaty on Stability, Coordination and Governance in the Economic and Monetary Union. It tries to add additional bandages on the badly conceived and crisis-ridden Euro project.

The euro was made by politicians for politicians, hoping they would get away on a European scale with overspending and hidden financing they had all been doing since the 1970s. Then surprise, surprise, the public found out that the politicians cooked the books, not only in Greece but practically everywhere. In a commercial company that sort of duplicity and malpractice would have been considered criminal. But politicians say it is normal for them. They are only dealing with public money!

No wonder that the politicians’ main scam, the Euro, has experienced only 7 or 8 years of stability and convergent national bond interest rates.  That is a blink of an eye in the lifetime of a solid, stable currency. Why did interest rates explode again? It does not have solid monetary or democratic foundations.

The euro’s worth has fallen to a quarter or  fifth of what its value should be worth against stable stores of value. Its conception and management by the secretive EuroGroup, which is not an institution of the EU, flies in the face of any real Community democracy. A Community currency requires Community democratic control.

The other bandages that the Council politicians concocted in the privacy of their meetings, the European Stability Mechanism and the European Finance and Stability Facility with half a trillion euro and its Mechanism that leverages a few more billion from the EU budget. This created a company in Luxembourg to draw billions of loans and liabilities from international financial markets. Who is this money for? Why, the same States that are already seen as betraying the public’s trust in cooking the statistics and overspending their budgets. In other words the taxpayers will have to pay for any mismanagement in these operations too.

And what do we find in these treaties? Surprise, suprise! We find an assurance by the same politicians that anyone involved in these multi-billion operations, when seen to be obviously guilty of malpractice, is offered total legal immunity from prosecution!

Not only that no document will be available for public scrutiny. No document will be able to be controlled and judged by any court of law whatsoever! This is what the relevant article of the ESM says about its staff and their paper trail:
Immunities of persons
1. In the interest of the ESM, the Chairperson of the Board of Governors, Governors, alternate Governors, Directors, alternate Directors, as well as the Managing Director and other staff members shall be immune from legal proceedings with respect to acts performed by them in their official capacity and shall enjoy inviolability in respect of their official papers and documents.
Who are the governors? Why, the politicians! That is a paradise for crooks and crooked practice. It is an invitation to mega crisis.

The Background with my last commentary on this case can be found at Euro10.
The Ombudsman’s judgement on the Fiscal Compact cover-up can be found at

14 January, 2014

Britexit1: If Britain exits the EU, where will it end for the UK, for the EU and the world?

What will be the repercussions if UK citizens vote to leave the EU? This series of commentaries, Britexit, deals with various aspects of problem. First some major economic implications and what you are not being told by dishonest bureaucrats and ignorant or willful politicians.

The EU is the world’s largest trading unit. Its GDP represents 23.2 percent of world GDP. This is far bigger than the USA. In 2012 EU-28 had a combined GDP of $16.72 Trillion. The USA was then $15.68Trillion. The UK has a GDP of some $2.44Trillion, rather small in comparison. India’s GDP is $1.62Trillion.
These figures come from the World Bank given in Wikipedia.

Whatever may be said about China’s economy, it should be recalled that EU is twice the size of China’s GDP which is at $8.36Trillion.

In global terms the UK has 3.5% of world GDP.

That is relatively small but changes to the present structure, if not handled with care, could cause serious global disruptions. Major transatlantic trade negotiations with the USA are under way to create a free trade area. What if the UK pulls out of the EU? How can these trade vectors continue to Britain’s advantage? The EU says that each family budget will gain 500 euros at the end of the negotiations. Will Britons lose out? Will it have enough political beef to conduct its own negotiations to at least the same level of success?

The great danger is that EU renegotiation of the UK might well cause major disruption to world trade and international legal agreements, unless far-sighted measures are undertaken to make the process as smooth and as problem-free as possible.

How can UK avoid looming challenges elsewhere? Take a look inside the UK. Two referendums are on the books, one for membership of the EU, the other in Scotland for independence from the UK. Others might come fast and furious after this, once the voters have a taste for referendums as a means to redress the balance against unpopular politicians who seem to ignore public opinion.

British exit from the EU might exacerbate national tensions within the United Kingdom. Will Britain break up? The UK might be reduced to separate regional nations of England, Wales and N. Ireland. The Scottish government has declared it wishes to remain inside the EU. No solution for Whitehall that does not take into account the possibility of an independent Scotland remaining inside the EU (or for that matter an independent Wales, and N Ireland separately or as a single entity) is acceptable.

While the British government in London’s Whitehall might have to calm fears at home, it needs also to pour oil on troubled waters with Brussels. No solution that leaves Britain and the EU as antagonistic forces after negotiation can be judged successful. How can peace and harmony be assured? Articles 49 and 50 on entry and exit of the EU in one of the two Lisbon Treaties are full of traps and complications to wreck the unwary. (These can be discussed later. )

The first vital priority for both British politicians, bureaucrats and the public is to get informed about what the European Community is and what the European Union is and what it isn’t.

Major technical and legal problems for exit are too often ignored. The European system that Britain entered in 1973 did not include the European Union (EU). The latter is an expansion, and a grossly deformed and distorted one at that, of just one of three European Communities, the European Economic Community or Customs Union. It came with the Maastricht Treaty that was rejected by the Danish electorate. (It had to vote again but many Member States did not even get that chance of one referendum.)

The very first principle of the supranational Community system is that the publicly expressed opinion on the constitution and exercise of powers is sovereign. Politicians buried that document they all signed up to in the French Foreign Ministry archives for half a century! What sauce! Robert Schuman‘s main aim was to create a peace-enhancing European economy. He provided the means for a thorough-going Democracy. Charles de Gaulle who seized power in France in 1957 put that on ice but did not destroy the potential to construct real European democracy.

The supranational Community system was first blocked by de Gaulle with his policy of wrecking it by stealth then a policy of the empty chair (boycott), followed by closed-door arm-twisting of small States, until the Council of Ministers became his poodle. Today too many government leaders act like ‘little Gaullists’ as they cut ‘package deals’ for themselves behind closed doors without public approval or knowledge.

The British still feel riled by Continental attitudes typified by de Gaulle looking down his long nose and saying ‘NON’ to the UK, very undiplomaticly at a press conference as a minor question of French policy. Today’s politicians have yet to reform the anti-democratic measure Europeans were forced to swallow at that time with its wine lakes, beef and butter bergs as de Gaulle and other national leaders took European taxpayers money to subsidize their own national policies. The Euro is the latest scam by nationalist politicians who corrupt decent politics and debase money as a store of value.

Britain’s policy was also typified by ignorance and antagonism by its bureaucrats in London, Whitehall. (That is not unusual for bureaucrats. The French ministry, the Quai d’Orsay, were among Schuman’s greatest opponents. Both were happier with the status quo, treating all other Europeans as foreigners to be exploited for the national interest that they, the bureaucrats, defined.) Schuman’s democracy should give free voice to European industry, workers and consumers, to regions and national parliaments.

Whitehall has shown its profound ignorance about the European Community system in the past, especially when it comes to referendums.

In June 1975 the voters were asked:
Do you think the UK should stay in the European Community (Common Market)?
That borders on criminal neglect. What catastrophic ignorance! Or was it Soviet-style deception and disinformation? Whitehall civil servants are supposed to be intelligent and well-educated.

The Common Market was just ONE of THREE Communities that the UK was a member of. The UK joined all THREE in 1973! The Coal and Steel Community, Euratom and the Economic Community. The latter is called in UK the ‘Common Market’ as if it were the place to buy vegetables with soil still attached.

If Whitehall had told the truth (then and now) they would have to explain how the Community system was supposed to work and why there were THREE. And vitally politicians and civil servants would have to discuss European Democracy and the Gaullist corruption of it. That would expose to all Europeans (not just the British)  the wholesale scam of the Council of Ministers closed door deals. At this time the Labour government boycotted the European Parliament as a totally undemocratic institution that de Gaulle had sidelined with his poodle-powers.

In 2002 politicians decided — without any referendum even whispered or suggested — not to renew the founding Treaty of Paris that defines the principles of European democracy. This is one reason that the European iron and steel industry has suffered spectacular decline. Where is European Energy policy? Where is Europe’s defence against foreign threats to its existence?

Today in 2014 a similar SHOCKING level of ignorance is apparent in the proposed question for the upcoming UK referendum — even after it had been corrected by the Watchdog Electoral Commission:
Should the UK remain a member of the European Union?
To thoroughly leave the system, the UK must also leave the remaining Community, Euratom. It is quite separate from the European Union. The UK could possibly leave the EU. Then the UK will find itself an uncomfortable reality. The UK will still find that it has membership of Council of Ministers. It will be obliged to be represented in other bodies such as the European Parliament, the Economic and Social Committee, the Court of Auditors and the Court of Justice. (Euratom and the European Coal and Steel Community (ECSC) never had the European Council as an official institution.)

Only recently the UK reaffirmed its membership in Euratom. The last modifications to the ECSC and Euratom treaties were made in the Treaty of Nice of 2001 for purposes of enlargement. Some protocols of the Lisbon Treaty (rejected by referendums when it was called the Constitutional Treaty!) were added to the Euratom treaty and thus the UK confirmed Euratom as an active treaty. Article 208 says it is ‘concluded for an unlimited period.’

British politicians, bureaucrats and the British public need to get the facts — not to mention all those in Brussels who are living myths!

How can UK exit both the EU and Euratom too? Keep reading these commentaries regularly and find out! Check out the facts on Schuman Project website !