Euro Area

[Furunculus]

Sure families are a vital building block within society. But most city states are far more diverse then any one family group. The variation within genes between ethnic groups is less then variation with a group. And the biggest variation between any two groups is not black, white, north, south, red head or brunette... it's man and woman. That little X vs Y is the biggest genetic variation.

you a taking what i say too literally. :p

familial sentiment = social/group identity.

Ol' Herman was subsidizing signor Miguel well before Wilhelm decided that Tanganyika would be a good place for a sausage factory.

you say that, but the tortured grimace on Merkel's face tells an entirely different story.

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perhaps there is a solution:

http://blogs.telegraph.co.uk/finance...-wrong-answer/

[Papewaio]

you a taking what i say too literally. :p

familial sentiment = social/group identity.

Hard not to in written word of the net, the tone is all lost and banter takes hours. Familial is normally used for family as in ones relations.

Familial level societies were generally hunter-gatherer bands. Once we got over that level we entered Tribal societies... which a lot of these gangs in one form or another are reverting back to the hunter-gatherer groups.

I think most people in a modern nation state can identify them as a member of a family and still have loyalty to a nation. It's pretty easy to look at a large nation and see groups within it that one readily identifies with and others one doesn't. A nation is a composite of many many groups, after all a modern nation relies on modern economics which includes specialisation... and lots of people hang out in groups of like specialists be it doctors, engineers or gamers online.

[Adrian II]

Buddy of mine has always been all-out against the euro, period. Over the years we had quite a few debates. I always thought that a limited euro for the fiscally disciplined, exporting economies like Germany and The Netherlands only (colloquially known as the 'deuro') would be viable. I was probably wrong.

Anyway, today he has a column out in which he calls the euro 'the EU's suicide pill' and advocates its dissolution. So here's what we are debating now: supposing that there would be enough political will to consciously dissolve the euro in a controlled manner, how do we go about it? What strategy would be best?

What do you guys think?

AII

[Kralizec]

Buddy of mine has always been all-out against the euro, period. Over the years we had quite a few debates. I always thought that a limited euro for the fiscally disciplined, exporting economies like Germany and The Netherlands only (colloquially known as the 'deuro') would be viable. I was probably wrong.

Anyway, today he has a column out in which he calls the euro 'the EU's suicide pill' and advocates its dissolution. So here's what we are debating now: supposing that there would be enough political will to consciously dissolve the euro in a controlled manner, how do we go about it? What strategy would be best?

What do you guys think?

AII

I think it's ironic that he first compares the EU to Hitler, and then a few paragraphs later complains that you can't oppose centralisation without being called a populist or a nationalist. The article in NRC he refers to was infinetely better and more informative in every respect.

Anyway, I suppose the hypothetical return to national currencies (which I oppose) would be the mirror image of the introduction of the Euro: exchange rates for the nascent currencies are set, followed 1-2 years later by the introduction of actual printed money. Then a year or so where you can pay in both Euro's and the nations respective currency before the former is entirely abolished.
Next: the Netherlands pegs the guilder to the German mark, again waiving any pretentions of monetary policy, and a decade of whining of how Henk & Ingrid got financially screwed by the transition to the guilder.

[Adrian II]

I think it's ironic that he first compares the EU to Hitler, and then a few paragraphs later complains that you can't oppose centralisation without being called a populist or a nationalist.

I think he is right that the Merkozy plan will go the way of the failed authoritarian grand projects of the past. And you misrepresent his statement about populism. Anyway, a transition doesn't seem as simple as that. For instance, what should happen to all debts nominated in euros? I suppose The Netherlands could kiss most of their 150 billion euro loans to Italy, Spain, Greece and Portugal goodbye. Our 40 billion export to these countries would possibly be halved because of their much cheaper new currencies. And that's only us. I would predict humongous instability throughout Europe. So what would be the proper mechanisms to more or less control such seismic movements?

AII

[Furunculus]

I think he is right that the Merkozy plan will go the way of the failed authoritarian grand projects of the past. And you misrepresent his statement about populism. Anyway, a transition doesn't seem as simple as that. For instance, what should happen to all debts nominated in euros? I suppose The Netherlands could kiss most of their 150 billion euro loans to Italy, Spain, Greece and Portugal goodbye. Our 40 billion export to these countries would possibly be halved because of their much cheaper new currencies. And that's only us. I would predict humongous instability throughout Europe. So what would be the proper mechanisms to more or less control such seismic movements?

AII

i think you are on the money.

[Kralizec]

It's actually quite more complicated than that - who's going to exchange their euros for drachmas? I certainly wouldn't. In theory you could trace all euros to the country that issued them, but then there would be a problem with a Finn going to the bank with 10,000 euros and getting markkas, marks, liras, pesetas and drachmas in return.

I think he is right that the Merkozy plan will go the way of the failed authoritarian grand projects of the past. And you misrepresent his statement about populism. Anyway, a transition doesn't seem as simple as that. For instance, what should happen to all debts nominated in euros? I suppose The Netherlands could kiss most of their 150 billion euro loans to Italy, Spain, Greece and Portugal goodbye. Our 40 billion export to these countries would possibly be halved because of their much cheaper new currencies. And that's only us. I would predict humongous instability throughout Europe. So what would be the proper mechanisms to more or less control such seismic movements?

I imagine (allthough I'm not exactly well-versed in this sort of thing) that there'd be a long interim period in which national, new currencies exist on paper and pegged to the Euro. This will give time for a lot of government bonds to reach maturity; for those that do not mature in the interim, they'll be "partitioned" into multiple bonds notated in all the different currencies of the former Eurozone. Wether anyone would want to buy new bonds in Drachme or Lira is of course the problem of Greece and Italy, and noone elses. Or at least directly.
For private debts; I imagine that many will renegotiate and pick a relatively stable currency as a bench mark: say, at this point the debt is worth 100.000 Japenese Yen, and when payment is due we expect payment in [French Francs, Liras, Pesetas etc.] worth the same amount in Yen.

As I said before though, I'm not in favour of disbanding the Euro currency. I imagine the resulting situation will be a lot worse then during or before the Euro.

[Sarmatian]

I think it's ironic that he first compares the EU to Hitler, and then a few paragraphs later complains that you can't oppose centralisation without being called a populist or a nationalist. The article in NRC he refers to was infinetely better and more informative in every respect.

Anyway, I suppose the hypothetical return to national currencies (which I oppose) would be the mirror image of the introduction of the Euro: exchange rates for the nascent currencies are set, followed 1-2 years later by the introduction of actual printed money. Then a year or so where you can pay in both Euro's and the nations respective currency before the former is entirely abolished.
Next: the Netherlands pegs the guilder to the German mark, again waiving any pretentions of monetary policy, and a decade of whining of how Henk & Ingrid got financially screwed by the transition to the guilder.

It's actually quite more complicated than that - who's going to exchange their euros for drachmas? I certainly wouldn't. In theory you could trace all euros to the country that issued them, but then there would be a problem with a Finn going to the bank with 10,000 euros and getting markkas, marks, liras, pesetas and drachmas in return.

[Papewaio]

What do you guys think?
AII

It would also cause 'brand' damage similar to that of the US Congress bickering.

Considering the basis of the EU is first and foremost economic and you can't even get that right iff you give up on the Euro.

It would effectively dissolve any future ambitions of being a united Europe.

External nations including Russia, China and the US will be wondering how trustworthy the word of any European nation is if they cannot even look after their own EU members.

What treaty will be worth the paper it is printed on if the modern EU at the first pressure buckles and can't work out it's differences without having temper tantrums more beffiting a nusery "it's my currency not yours", "but I want all the benefit's and none of the hardwork", "I want your cheap labour but I don't want to support the country that makes it possible"

Talk about waving the white flag of surrender and truly putting Europe on the trash heap of the has beens. Do you have anything of value like the Marbles that some up and coming states can buy off you in the next hundred years or so? Maybe reposition your new fractured currencies around your ankles in an attempt to out compete Vietnamese labour for manufacturing outsourced from China.

Chose your long term trajectory now. Either deal yourselves in to the future with the Americans and Chinese or stop bitching about how great you were and will never be again. A united Europe has a future, a fractured one will just prove to the rest of the world that two world wars wasn't enough to knock some sense into such a tribal society.

You're on a cusp where Europe can still be something meaningful in the world. Or it can just be a stop over pit stop for the world shakers. A charming destination for tourist's looking for the charming and kitch "Oh look dear the Orient Express is going through Old Europe, do you remember A ma saying that they used to be world leaders until they started looking inwards and collapsed like the China and Japan of old."

Mind you I live in the world's largest quarry. So what the fudge do I understand about real politik.

[Adrian II]

Considering the basis of the EU is first and foremost economic and you can't even get that right if you give up on the Euro.

Uhh, hit me

Well, I don't think the EU is first and foremost about economics. And it certainly isn't first and foremost about a common currency. Remember we got along well without one for 50 years. Most of the present eurozone economies would be much more competitive without the euro; the weaker ones would be able to devaluate and the stronger wouldn't have to bail out the weaker ones in the midst of a recession.

Most importantly, each country would retain (or regain) its sovereignty. Further centralisation according to the Merkozy plan would mean putting half a dozen member states under guardianship of an outside agent, i.e. the ESFS or so-called 'future European IMF'. It would spell the end of democracy for these countries since the richer member states would propose to them a deal akin to the one Athens proposed to the Melians.

It would effectively dissolve any future ambitions of being a united Europe.

I think it might enable Europe to re-unite. It is deeply devided now, if you hadn't noticed, and Merkozy is stretching it to breaking point. Any more of this and we will be looking at encampadas throughout the continent. And as much as I hate camping, I'll be joining them.

AII

[Kralizec]

Uhh, hit me

Well, I don't think the EU is first and foremost about economics. And it certainly isn't first and foremost about a common currency. Remember we got along well without one for 50 years. Most of the present eurozone economies would be much more competitive without the euro; the weaker ones would be able to devaluate and the stronger wouldn't have to bail out the weaker ones in the midst of a recession.

Most importantly, each country would retain (or regain) its sovereignty. Further centralisation according to the Merkozy plan would mean putting half a dozen member states under guardianship of an outside agent, i.e. the ESFS or so-called 'future European IMF'. It would spell the end of democracy for these countries since the richer member states would propose to them a deal akin to the one Athens proposed to the Melians.



I think it might enable Europe to re-unite. It is deeply devided now, if you hadn't noticed, and Merkozy is stretching it to breaking point. Any more of this and we will be looking at encampadas throughout the continent. And as much as I hate camping, I'll be joining them.

AII

Is the EMU currency itself the problem, or the half-assed institutions that surround it?

Arguably, the current problems would have been a lot smaller if we had a Stability & Growth pact that contained more realistic criteria and was properly enforced.

The EU government structures need to be rebuilt, in my opinion in the likeness of the German government. A Bundestag composed of European parliamentarians and a Bundesrat composed of representatives of the national governments. A proper government who answers to, and can be sacked by the Bundestag. A clearly defined group of tasks in which the EU is competent, the rest being the domain of the national governments.

[Adrian II]

Good ideas, Kralizec, both on the transition away from the euro and on possible future institutions. Only in the present climate there is no room and no political will for a complete institutional rehash. Without this bloody euro mistake we might have been able to progress politically and get our house in Brussels in order, for which a Bundestag/Bundesrat (or US Congress/Senate) model might be suitable - and by that I mean workable as well as equitable. I just don't see it happening now.

AII

[Papewaio]

Uhh, hit me

Well, I don't think the EU is first and foremost about economics. And it certainly isn't first and foremost about a common currency. Remember we got along well without one for 50 years. Most of the present eurozone economies would be much more competitive without the euro; the weaker ones would be able to devaluate and the stronger wouldn't have to bail out the weaker ones in the midst of a recession.

Most importantly, each country would retain (or regain) its sovereignty. Further centralisation according to the Merkozy plan would mean putting half a dozen member states under guardianship of an outside agent, i.e. the ESFS or so-called 'future European IMF'. It would spell the end of democracy for these countries since the richer member states would propose to them a deal akin to the one Athens proposed to the Melians.

EU formed out of the EEU, not out of a revolution, it didn't have anything like the Enlightened Independence statements of the US. It isn't a Federation of nations like Australia. It was formed out of an Economic Union, who once it dropped the Economic part out of the EEU created the Euro.

From the outside it has looked first and foremost about the money. It's not about representation for the people, they can't directly vote for EU officials. The only thing they get is travel, trade and the ability to spend money... hmm tourism and trade seems pretty much economic to me. And once things start getting tough something as benign in the long term as a common currency is looking at getting dropped. Forgive me if it doesn't tarnish the capabilities of the EU... after all it ain't a military superpower... it's supposed to be an economic one.

[Furunculus]

EU formed out of the EEU, not out of a revolution, it didn't have anything like the Enlightened Independence statements of the US. It isn't a Federation of nations like Australia. It was formed out of an Economic Union, who once it dropped the Economic part out of the EEU created the Euro.

From the outside it has looked first and foremost about the money. It's not about representation for the people, they can't directly vote for EU officials. The only thing they get is travel, trade and the ability to spend money... hmm tourism and trade seems pretty much economic to me. And once things start getting tough something as benign in the long term as a common currency is looking at getting dropped. Forgive me if it doesn't tarnish the capabilities of the EU... after all it ain't a military superpower... it's supposed to be an economic one.

the eu formed out of the iron and steel community:

http://en.wikipedia.org/wiki/Europea...teel_Community

The ECSC was first proposed by French foreign minister Robert Schuman on 9 May 1950 as a way to prevent further war between France and Germany. He declared his aim was to "make war not only unthinkable but materially impossible." The means to do so, Europe's first supranational community, was formally established by the Treaty of Paris (1951), signed not only by France and West Germany, but also by Italy and the three Benelux states: Belgium, Luxembourg and the Netherlands.

It was political.

Its purpose was to prevent germany walking over europe again, for the french to avoid be walked over again, for the benelux countries to avoid be treated as a gateway to said walking. The germans were embarrassed, the french nervous, and the benelux countries weary.

[Adrian II]

From the outside it has looked first and foremost about the money. It's not about representation for the people, they can't directly vote for EU officials.

Of course the EU represents the member nations and we want to keep it that way. What's happening with the bail-outs is already democratically questionable. Here's what the Bundesbank said in its latest report, as translated for our English speaking friends by The Telegraph:

The Bundesbank is questioning the legality of the EU bail-outs, warning that the eurozone is drifting towards a debt union without "democratic legitimacy": "The latest agreements mean that far-reaching extra risks will be shifted to those countries providing help and to their taxpayers, and entail a large step towards a pooling of risks from particular EMU states with unsound public finances. Unless there is a fundamental change of regime involving a far-reaching surrender of national fiscal sovereignty, it is imperative that the 'no bail-out' rule – still enshrined in the treaties – should be strengthened by market discipline, rather than fatally weakened."

Since practically no member state will accept 'a far-reaching surrender of national fiscal sovereignty' any attempted move in that direction as per Merkozy is stilborn. And enforcing 'market discipline' under the standing arrangements is nonsense, too. Just today we have heard that Greece's economy is shrinking at an alarming rate. The only way forward is for certain nations to leave the eurozone.

AII

[Furunculus]

I think most people in a modern nation state can identify them as a member of a family and still have loyalty to a nation. It's pretty easy to look at a large nation and see groups within it that one readily identifies with and others one doesn't.

that's kind of the point, there is a nation onto which the state can adhere, does that sentiment (familial i.e. my family) exist at a european level?