Another Eurocrat Power Grab

I am slowly going to resume blogging. There won’t be daily new posts just yet – my workload is too intense for that – but you can look forward to one or two articles per week for some time.

There is also going to be a small shift in focus of the blog. So far the articles have covered both American and European policy, primarily but not exclusively centered on troubled welfare states. From now on the focus is going to be more concentrated on the European scene, and the reason is this: nowhere in the world can we witness what the welfare state does to prosperity than in Europe. The lesson from Europe is one that America needs to learn, and learn from the ground up, or else we are going to head down the same destructive slope, right in to the same abyss of poverty, social and economic destruction – and totalitarianism.

The European crisis is unfolding right before our very eyes. This story from EurActiv about the latest attempts at expanding EU powers is a good example:

French President François Hollande sought to reassure Britain and other non-eurozone countries that plans to establish a special budget for the currency bloc will only come “in addition” to the EU budget and not “in substitution” of it. But he also warned: No country can prevent the others from moving forward. … British Prime Minister David Cameron said he would block talks if “massive increases” in the budget were proposed or if a deal that “does not have proper control” was put forward. Other countries like Germany are also opposed to any increase in the EU’s next long-term budget, although they appear less categorical than Britain.

The dream of the Eurocrats in control of the EU is, of course, to have a full-fledged budget and unrestrained fiscal control over half-a-billion people. If allowed to materialize, that new European super-state will have veto control over member state budgets and thus eventually the powers to impose a one-size-fits-all welfare state across Europe.

Such a monster of a government would have no precedent in the democratic world. That alone is reason enough for euro-skeptics to say no to it. But as the EurActiv story indicates, the preparation talks for the next bit EU summit have not yet reached that point. Thus far, focus is on much more mundane, largely technical issues:

But the EU budget’s overall pricetag will be only one of many other variables in the budget equation, with poorer countries also expected to throw their full weight into the negotiations. Speaking to journalists after the October summit of EU leaders, Hollande said he had sensed that relations between those in and outside of the eurozone will be a defining issue at the next summit. “Immediately, the reaction of countries that are not members of the eurozone is to say: ‘If you have a fiscal capacity, that means you remove [money] from the EU budget for a separate budget on the side’,” Hollande said. “No! I have reassured those countries. There is a European budget. This budget, we have to jointly determine its mass, its distribution, with cohesion funds, structural funds and agriculture policy. This is our budget for 27 [countries], tomorrow 28 or more.” For the euro area, there will be a separate budget, Hollande said, that will be put in place “in parallel” to the wider EU budget. “It is not in substitution, it is in addition” to the EU budget, he stressed.

They are complicating the way the EU is operated by creating parallel budgets. But this does not mean they are not expanding government. First of all, more complex government is always more government, and secondly, two budgets to pour money in to is more than one budget to pour money into. It is always easier to grow government with two budgets than with one.

As the EurActiv story continues, it points to the – cynically speaking – logical expansion of government that comes with the currency union:

Cameron has acknowledge that eurozone countries will have to move forward on their own, saying: “There will come a time I believe where you’re going to need to have two European budgets – one for the single currency, because they’re going to have to support each other much more, and perhaps a wider budget for everybody else.” … [French President] Hollande said this move towards a two-speed Union was already well underway, with eurozone countries already making decisions of their own, for example on banking supervision.

When the euro currency was created it was glaringly obvious that someone would one day suggest the creation of a full-fledged government at the same level as the currency. This was needed if for no other reason than to have a fiscal policy that could match the monetary policy at the euro-zone level.

That is now happening, and it is happening in a way that puts more government on top of Europe’s already humongous governments. It is also happening without bringing parliamentary democracy to the same level: the new euro-denominated extra government budget is going to be owned and operated by unelected Eurocrats, appointed in a process that is very, very far away from how any free, democratic country is operated.

The only thing bigger than the Greek budget deficit is the democratic deficit in the EU.