London’s Eurobloc Is Crumbling
April 26, 2012
With the European banking situation beyond desperate, and disintegrating rapidly, the British have been urgently pushing to establish the ESM by July, as a platform for the kind of hyperinflationary bailout required — i.e., in the order of magnitude of $9 trillion, not the silly (and non-existent) $430 billion the IMF announced last Friday. But the likely victory of Francois Hollande in France’s May 6 second-round election, and the collapse of the Holland government of Prime Minister Rutte on Monday, because of opposition to the EMS and the europact in general, have really messed up the timing of London’s game-plan. They are left stomping their feet, stuttering: “Hollande, Holland.”
For example, the Daily Telegraph‘s Ambrose Evans-Pritchard wrote on April 24 that the European “austerity bloc crumbles,” because “this week the tornado has smashed into the core, bringing down Holland’s government and probably the French leader Nicolas Sarkozy as well, in a cacophony of anti-EU diatribes.” He added that “the hard-Left and hard-Right are on the rampage across Euroland.” Similarly apoplectic, German state secretary Thomas Steffen (Federal Finance Ministry) spoke in Aachen, where LaRouche movement organizers confronted him on the need for Glass-Steagall, and the best he could muster was to protest over what he called a “nationalist populist right-wing shift” underway in Europe, as exemplified by Marine Le Pen in France, Geert Wilders in Holland, and… Gerry Adams in Ireland!
With the Financial Times warning editorially today that the Dutch government collapse “shows another core country going soft on the eurozone’s chosen strategy of universal austerity, with the hardcore fiscal disciplinarians looking increasingly under siege,” London’s policy agents across continental Europe were trotted out to insist that everyone had to keep their feet to the fire and endure the pain.
Leading the way was ECB head Mario Draghi, who told a meeting of Euro Parliamentarians that the eurozone is at “probably the most difficult phase of our process.” The economic austerity being implemented “changes profoundly the societies in which we live. This is a source of pain, [but] we must persevere.”
The Finance Minister of bankrupt Spain, Cristobal Montoro, likewise told his country’s parliament that “We are in an extremely delicate moment as a country, an extremely fragile moment,” which requires meeting the budget-cut target. “We have to guarantee that target, because the solution to the crisis, Spain’s credibility, and our access to markets depend on it.” The national government has the ability to “supervise, penalize, and intervene” in the country’s 17 regions if they don’t comply, he threatened..
German Chancellor Angela Merkel is also pushing back publicly against French Presidential candidate Hollande’s demand to renegotatiate the europact. Peter Altmaier, parliamentary whip of Merkel’s CDU, said in an interview: “If Mr. Hollande were to say that he wants to increase government spending and save less, he’ll lose the confidence of the financial markets. We will stick to our fundamental principles because there’s really no alternative.”
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