The Federal Constitutional Court of Germany is making a decision on the OMT program of the European Central Bank (ECB). In Britain, the bi-polarity of attitudes towards the EU is gradating. Greece is in the top news again with clueless Troika in the background. Welcome to the next week of the euro crisis.
After the bank crisis on Cyprus, Britain’s chicken-hearted intentions, and after rising euroscepticism in Germany, Greece is back in the limelight again. The country’s debt is still astronomically high and the country has been in recession for the sixth year in a row despite previous predictions. Therefore, the European Commission has no other option but to repeat its usual statement about the crisis: the recession will be over in a year, two at the maximum.
Recent developments have already split even the almighty Troika (ECB, IMF, European Commission) which negotiates conditions for providing loans to bankrupted European economies. The IMF was blaming the Commission that the debt restructurisation in Greece, which took place last year, came too late. The Commission has also been criticised for the underestimation of pro-growth policies.
However, the IMF isn’t without blame either. The leak of the internal document has revealed that IMF officials might have been intentionally lying about sustainability and redeemability of the Greek debt. Of course, lying was going on with a good intention – to avoid spreading the debt disease to the rest of the eurozone – the disease which has now been spreading all around Europe for the last 5 years like a plague.
While Troika is arguing, the rock of debts keeps falling down the hill. The rumours are that it will be necessary to cut another part of the Greek debt despite the fact that more than 200 billion euros have already been provided to Greece in the last 3 years. Another symptom of the European schizophrenia: do Greeks need another loan or a debt cut? Or both at once?
Greece has been full of surprises. This unofficial paradise of civil servants has recently closed the public broadcaster with its 2,500 employees. The broadcaster is planned to be restored later this year on a smaller scale. Meanwhile, Greeks have some media to take the information from hopefully.
The unsuccessful privatisation of the state gas monopoly has been an unpleasant surprise for Greeks. Regarding the lack of interest from foreign investors, Greece will have to find 900 million euros somewhere else to fulfil Troika’s conditions. The only thing worse than imperialists buying your state property is their lack of interest in buying it.
In Germany, the case of the OMT program of the ECB (the program of unlimited purchasing of obligations emitted by countries in debt) is being considered by the Federal Constitutional Court. As Germans assume, there will have to be someone to pay the debts of the countries eventually. The Federal Constitutional Court was asked to review whether the “unlimited” debt purchasing program is in line with the German law.
The Federal Constitutional Court is under the pressure of the public as well. 48% of Germans would reject debt purchasing by the ECB completely. Troika is obviously not the only one with problems in decision making. According to the reports, the opinion of the Court on OMT is similar to the previous statements related to the European Financial Stabilisation Mechanism: “Yes, but…” The Court might say yes to OMT with some restrictions so the ECB is satisfied and interests of German voters are not thrown completely off the table. However, the ECB is still willing to help the eurozone, no matter what (despite all the weird voices who want to follow legal procedures) and, thus, it is still considering the idea of negative interest rates on deposits of commercial banks.
There is a clash in negotiations between the EU and the USA on a free-trade area because of the French unwillingness. The French are already threatening to veto the negotiations if the audiovisual industry is part of them as well. France is probably trying to keep its ways of protecting the nation against Lady Gaga and Justin Bieber.
Even though the UK supports the idea of a free-trade area between the EU and the USA, it is not so clear on its membership in the EU. Referendum on getting out of the EU is becoming more and more realistic. Prime Minister Cameron has highlighted British interest in being primus inter pares in supranational organisations, including the EU. However, the internal opposition within the Tories is of totally different opinion. Even though the UK has a tough talk on the EU, the country has already chosen at least 30 out of 130 European treaties on modification of criminal law which are going to be incorporated into the British law system. This step was not appreciated by British eurosceptics, who had hoped Britain would stay completely apart from these law modifications.
At last there is also some good news from the EU. After the recent rejection of the proposal of olive oil bottles refilling prescription, the UK, the Netherlands, and Germany have joined and rejected the directive on the data protection. Typically of euro directives, good intentions are outweighed by the collateral damage. In this case, the costs of data protection audits would be too high, especially for smaller companies. Moreover, experience from Germany has revealed that unsatisfactory data protection is usually a consequence of banalities, like forgotten paper in a copy machine, or too simple password like “money123”.
Mentioning data protection, we should also bring to mind the US secret services’ program “PRISM”. According to the leaked information, US secret services with the assistance of global companies, like Google and Facebook, monitor the internet communication of their own citizens. European representatives have expressed concerns they might be spying EU citizens as well.
One way or another, I wish you a weekend free of spying or secret service visits.
Translated by Roman Ujbányai
