The EU treaty is a disaster for the left

[andyofborg]

Interesting read.

 

http://www.newstatesman.com/blogs/the-staggers/2011/12/european-treaty-cameron-stop

 

Stop your crowing about Cameron leaving Britain marginalised, lefties. The proposed EU treaty is perhaps the biggest catastrophe to befall the European left since the Second World War.

 

Sounds like semi-deranged hyperbole? Consider this: as Paul Mason has written, "by enshrining in national and international law the need for balanced budgets and near-zero structural deficits, the eurozone has outlawed expansionary fiscal policy".

 

Read that last bit carefully. Left-wing governments of all hues will, in effect, be banned by this treaty. If the French or the German left returns to power in the near future (and both are in a good position to do so), it will be illegal for them to respond to the global economic catastrophe with anything but austerity. An economic stimulus is forbidden – because the treaty has buried Keynesianism.

 

After this stitch-up, the left really needs to have a long, hard think about its attitude to the EU as it is currently constructed. There's still a sense that any criticism of the EU puts you in the same box as swivel-eyed Ukip-ers who rant about gypsies in shire inns. But there's a powerful left critique that needs to be made.

 

the devil of this will be in the final detail, are they looking for balance year on year or over an "economic cycle"? if it's over an economic cycle then it may allow enough wiggle room for a bit of government funded expansion in the tough times.

 

there is also bound to be a lot of argument about what part of a deficit is structural, and what part is investment in infrastructure and what part arises from the fact that governments have to borrow more in tough times to pay more in benefits than they take in in tax.

 

a deal was needed to prop up the weaker eurozone countries while the leaders pray for a miracle solution to the whole excess debt problem which isn't the monumental write off that would wipe out the financial system.

 

cameron did the only thing he could and should have done, possibly for the wrong reasons but it would be nice to hope that he has at least one sane advisor.

[I1L2T3]

how does that (austerity economics) help them (the banks) do that?

 

The money for buying the assets will need to come from taxpayers, diverting funds away from public services. Taxpayers are the last remaining backstop and the European banks have a lot of toxic assets they need to offload. If they can't unload they fail. Tremendous amounts of money will need to be poured in to keep the financial sector afloat. The more that goes in the less there is for other expenditure.

[andyofborg]

The money for buying the assets will need to come from taxpayers, diverting funds away from public services. Taxpayers are the last remaining backstop and the European banks have a lot of toxic assets they need to offload. If they can't unload they fail. Tremendous amounts of money will need to be poured in to keep the financial sector afloat. The more that goes in the less there is for other expenditure.

 

except that the money can only come from tax which austerity economics lessens because it shrinks the economy or borrowing which the deal prohibits.

[Longcol]

The proposed EU treaty is perhaps the biggest catastrophe to befall the European left since the Second World War.

 

Somebody has obviously not heard of the USSR sending the tanks into Hungary in 1956 or Czechoslovakia in 1968.

[Mecky]

my bold.

 

how do you work that out ???

 

the fact that 60% of european goods are bought by the u.k says they need us WAYYYYYYY more than we need them.

 

Oh right, http://www.civitas.org.uk/pubs/EUFactsheet.php

[Longcol]

the fact that 60% of european goods are bought by the u.k says they need us WAYYYYYYY more than we need them.

 

What?

 

This would mean we buy more European goods than the Germans and the French combined - where on earth do you get your figures from?

[Mecky]

What?

 

This would mean we buy more European goods than the Germans and the French combined - where on earth do you get your figures from?

 

I think he's been to the pub

[mj.scuba]

This may be of interest:

https://www.uktradeinfo.com/index.cfm?task=euearlypub&hasFlashPlayer=true

 

UK imports approx £18bn in goods and services per month from the EU.

UK exports to the EU are approx £14bn per month.

 

Might I suggest, talk of "they need us more than we need them", or "we need them more than they need us", is a gross over simplification. The trade relationship the UK has with the rest of the EU is mutually beneficial. Suggestions that trade would come to an immediate and grinding halt should either the Euro collapse, or if we ever exit the EU, are equally as stupid.

[andyofborg]

Suggestions that trade would come to an immediate and grinding halt should either the Euro collapse, or if we ever exit the EU, are equally as stupid.

 

it would certainly decrease, by how much no one will know until it happens

 

so i guess the question is, do you feel lucky?

[I1L2T3]

except that the money can only come from tax which austerity economics lessens because it shrinks the economy or borrowing which the deal prohibits.

 

Indeed. Economic death spiral or more borrowing. Or printing by the ECB.