It has been a busy week of paralysis within the EU! So I thought that I would take some of the more interesting statements, and give my opinions on them!
There was talk of reducing public sector salaries in More welfare and public sector pay cuts urged by top ECB man:
THE EUROPEAN Central Bank is pressing the Government to cut public sector pay in the budget next December and accelerate its austerity drive.
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Mr Stark, the top German official in the ECB, argues that public sector pay in Ireland is too high by euro zone standards and should be cut to help restore order to the country’s public finances.
Any such move would bring down the Croke Park deal, which obliges the Government not to cut public pay. However, Mr Stark says the Government should consider from a political point of view that civil service pay in many of the countries supporting the Irish bailout is considerably lower than in Ireland.
I strongly agree with Mr Stark! It is inequitable that one section of society has it salaries protected in such a manner, especially when these people enjoy so many other benefits. Furthermore, it is inequitable that the majority of workers are being asked (through higher taxes) to support inflated salaries for so few workers. I wish that the Irish Government would stand-up for the majority of workers, instead of those who complain loudest!
It is also surreal that the Irish Government is borrowing money from other countries so that it can pay its civil servants substantially more than the countries who are lending the money pay their civil servants. Frankly, I do not understand why this is not a condition of the loans.
The Frankfurt-based institution wants social welfare entitlements reviewed and is also calling for greater efforts to facilitate pay cuts in private employment contracts.
Again, this is surreal! For example, we are borrowing money from Germany so that we can pay unemployment benefits that are over twice as high as German unemployment benefits!
Then there was the controversial suggestion about flying the Irish flag at half-mast, as reported in Half-mast flag idea for debt draws ire.
In his comments, Mr Oettinger referred to “deficit sinners” who needed “unconventional” treatment to help them mend their ways – possibly through officials appointed by Brussels and imposed in recalcitrant capitals.
“There has been the suggestion too of flying the flags of deficit sinners at half-mast in front of EU buildings. It would just be a symbol, but would still be a big deterrent.”
I have no problem with this situation. Ireland is in a bad place at the moment, and everybody shares a collectively responsibility for this indirectly for electing the successive governments. I think that a shameful treatment like this would encourage everybody to fix the mess sooner rather than later.
Furthermore, I heard a lot of politicians objecting to this idea, but I did not hear a single one express a good reason!
I read more discussion this week than ever before about the prospect of a federal EU, as described in Barroso urges ‘federalist’ integration as sole solution.
Seeking to take the initiative amid wild market volatility driven by concerns over a Greek default, Mr Barroso called for much closer political integration and said the EU needed a “new federalist moment” to confront the most serious challenge for the union in a generation.
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“The only right way to stop the negative cycle and to strengthen the euro is to deepen integration, namely within the euro area,” he said. “This is the way to go. It is also the only way for the euro area to really play the role that investors and global partners expect it to play. What we need now is a new, unifying impulse – a new federalist moment. Let’s not be afraid of the word – a federalist moment is indispensable.”
I strongly favour a strong EU federal government for two reasons. Firstly, Ireland has time and time again shown that it cannot manage its own affairs (ranging from national finances, healthcare, and policing). I am not sure if this is due to ineptness and incompetence, or corruption.
Secondly, I think that the EU needs to express a stronger, more singular, voice on the international stage.
Of course, such a federal government would need a lot more public credibility compared to the “appointments” system currently favoured in EU political circles. (Where is President of the European Council, Herman Van Rompuy, hiding these days?)
Finally, the crisis has truly become an international issue, as described in Greek reform more essential ‘than ever’.
China added its voice to US concerns over Europe’s apparent inability to stop debt contagion spreading, while Indian and Brazilian officials said major emerging economies were discussing increasing their euro sovereign holdings. US treasury secretary Tim Geithner urged European leaders to act more forcefully to solve the escalating crisis, saying they had the economic and financial capacity to do so.
This is just plainly embarrassing that the US and China are having to become so involved in helping Europe fix its own problems!
Yes, it was an interesting week!
Tags: Ireland
