Last week in Brussels, the United Kingdom for the first time in a long time refused to be dictated to by continental elites. David Cameron, under enormous pressure from the Commission, other “core” Union members, and the (then) sotto voce pro-Europe disposition of his LibDem coalition members, refused to agree to the “fiscal compact” to   more

On December 7th, French President Nicolas Sarkozy and German Chancellor Angela Merkel presented a letter to the European Council President Herman Van Rompuy with their proposals for how to solve the current EU crisis. Except their letter was not really a proposal, in that it did not consist of a draft treaty amendment but only broad principles.
But it   more

European Council President Herman Van Rompuy has just floated a proposal to subject all EU members – not just eurozone members – to more rigorous budget scrutiny by Union organs. The proposal is so contrary to the Union treaties and its scope so overreaching to the current eurozone debt crisis that it is doomed to fail.  more

Looks like the EU has found an alternative to German domination of everybody else. It’s French-German domination of everybody else.
The grand “deal” announced earlier this week has something for both France and Germany. For the Germans, France will temporarily stop talking about eurobonds and will agree to automatic sanctions for violation of new budget rules.   more

The past two weeks have seen a dizzying array of proposals from virtually every organ of the EU claiming that they can make the eurozone more efficient, durable, and solvent. If you noticed that no one is saying that they will make the eurozone more democratic, you’re not the only one. The most anti-democratic organ which   more

What’s the newest strategy of the European Commission to remove any democratic accountability from the eurozone members? They are now aiming to consolidate all eurozone members on the IMF Executive Board into a single member, represented by… the European Commission.
The move would make the Commission less reliant on the pronouncements of European Council and the   more

No relationship in Europe is more complex or dangerous than the relationship between the EU and the Eurozone.
The EU contains 27 countries. Only 17 of them use the Euro.
The economic impact of the Euro on non-Euro countries is obvious. Now consider the political effect.  more

The Merkel-Sarkozy strategy for changing which countries are able to use the euro is taking shape. Their next efforts will likely include an attempt to change the treaties that govern how to exit the euro and how the countries more deeply integrate.
Additional treaty powers to decide who can be in the euro will be sought at   more

Whatever political settlement the Lisbon Treaty created to allow for the permanence of the euro is about to change. Chancellor Merkel will propose a significant change in the existing treaties, which will finally allow Greece and perhaps others to leave the euro but not the EU, and likely bestow on the eurozone effective authority to   more

A few hours after the prediction on this blog of a multi-track euro, the Germans and French went public with their desire to oust certain countries from the euro and build a new eurozone with much deeper policy integration and a much more selective membership.
Such a move gives the lie to several persistant and powerful   more

The race to save the euro, and how it’s being conducted, will not just affect bailed out countries’ control over their budgets. It will also likely harm what remaining democratic character the Union has by allowing for influence over debtor states’ votes in a way the treaties anticipate and forbid.
The euro may be saved, but these safeguards,   more

Though his actions quickly descended into farce, soon-to-be-former Greek Prime Minister Papandreou had the right instinct calling for a referendum on the austerity package that European negotiators are imposing on his country. There has been a long-stranding “democratic deficit” within the European Union, with major decisions being made without the input of the Union’s citizens. The   more

The G-20 summit failed utterly to secure any resolution of the eurozone’s economic crisis.
Yet two decisions were taken that may at some future point contribute to a solution:
First, the G-20 agreed to continue to consider increased involvement of the International Monetary Fund to stem the crisis. In practical terms, this means that the United States   more

David Cameron also has a referendum problem. Britain’s current government uneasily combines euro-skeptics and euro-enthusiasts. Two weeks ago, 81 Conservative backbenchers broke with party leaders to vote in favor of a new referendum on Britain’s EU membership.
Cameron had promised such a referendum when he was in opposition, but he has abandoned that commitment in his   more

The reason European Union representatives trying to deal with the Greek debt crisis are so furious with Greek Prime Minister George Papandreou for planning a referendum about the proposed eurozone relief package is only partially because those Union politicians are insulted that Greece might say no to what French President Sarkozy says is the “only way   more

As the euro bailout proceeds, there are almost daily references to some foreign country that is being lobbied to “contribute” to an aspect of the fund. China and Japan are the most commonly mentioned potential suitors for guaranteeing or buying new eurobonds. The details are sketchy as to the extent of both’s participation, and likely   more

Whether today’s announcement that holders of Greek sovereign debt have agreed in principle to a 50% haircut on the face value of the instruments raises some critical questions.
On the surface, with the notion of first-loss guarantees of new debt taking shape, this addresses the problem of existing debt for the first time, but first is   more

Former Fed Chairman Alan Greenspan has been reenforcing the conventional wisdom that the current eurozone debt crisis can be traced to a north-south cultural divide between member states. This is the wrong assessment and blaming culture misses the essence of the problem. The reality is that the structure of the euro was unable to enforce fiscal   more

At some point in this crisis, the eurozone is going to have to decide whether it wants to have a solvent euro for the moment in part of the Union, or a lawful and democratic Union in all of it.
The EU is groping for ways to bail out a list of states that includes Greece,   more

The biggest event in Cameron’s first 100 days has been the PM’s silence over a proposed European Union move to begin directly taxing the British people.  more