The Brakes Are On – Let There Be Euro!

There can hardly be a single week without at least one funny Eurocratic idea. We informed you some time ago about the idea to install speed limiters to all cars. Those limiters would slow down cars according to passing traffic signs (politicians’ cars would be excluded, of course). Those who take care of our health, happiness and good mood have recently brought up another idea. They are suggesting that every car (the old ones as well as the new ones) should have a speed limiter set at 115 km/h. According to them, this is supposed to decrease the amount of accidents and emissions.

However, it is possible that this kind of regulation will not be necessary any more. Driving fast could become unattainable luxury for Europeans. The brakes of the European economy have been on for last couple of years. In Greece, which has been hit by the crisis in the worst way, the intensity of car transportation was lowered by 40% between 2010 and 2011. Greeks are switching from cars to bikes, because they do not have money to operate them.

In Spain, the number of the unemployed who are registered decreased by 2,475 people. Such positive news could seem less impressive if we take a closer look at unemployment charts. We can also read the news about IKEA, which launched online recruitment for 400 employees for its new shop, and after 48 hours its online system collapsed because of 20,000 applications.

The Netherlands has lost the highest possible rating by the Standard & Poor’s agency. Thus, only three Eurozone countries still have AAA rating: Germany, Finland, and the small Luxembourg. Some countries are applying brakes more, others less, but the first ones are also looking for a way how to slow down the others. It is much more difficult to explain one’s own failures to voters if neighbouring countries are prospering. To describe this, France has invented a new term called “unfair social competition“.

The French consider the fact that Germans do not have a universal minimal wage unfair (however, they are probably going to have it soon). (Not only) thanks to this, France has had the highest unemployment rate since 1997, while Germany has had the lowest one since the unification and twice as low as France. If Germany introduced the French minimal wage, approximately 8 million Germans could lose their jobs.

Arne Müseler /

There are also other reasons why the system of social security is now a hot topic. In the UK, the debate on Eastern-European immigrants and their access to social security system is on. A German court has decided that the Romanian couple who has been trying to find a job for one year unsuccessfully, has a right to participate in the German social security system. This decision caused public indignation. The public is willing to be supportive, but only of people, who have the “right” country in their passports. A similar opinion is widespread also in France, where people are starting to suggest a restriction of the social security system, which is supposed to be available only to Frenchmen. But gentlemen, we can hardly build the European super-federation this way!

There is some good news from the banking sector as well. The Irish government has successfully sold some Irish banks’ stocks for 580 million euros. It is only a drop in the ocean of losses (tens of billions of euros are owed by Irish taxpayers), but at least it indicates the existence of some investors’ trust in Irish banks.

On the other hand, in Slovenia the trade in bank stocks has been completely stopped until the results of ongoing stress-tests are known. It is still being debated, but Slovenian large banks might need approximately 5 billion to survive. Banks possess 8 billion in bad loans and, since they are mostly owned by the government, they do not have foreign partners, who could provide them with needed capital.

Six European banks got a 1.7-billion-euro fine for cartel formation in relation with the famous scandal of LIBORgate (manipulations of the LIBOR interest rate). Even though this is an unprecedentedly tough fine, we should not crack a bottle yet. Banks have received bailout money reaching tens of billions of euros.

European Union law is now composed of 34,000 legal acts, or 100,000 acts, court decisions, standards, and international treaties altogether. Tens of thousands of hard-working bureaucrats in Brussels office complexes are busily working on keeping this legal act growth smooth. The old rule “ignorantia juris non excusat“ cannot be used any more without a pinch of irony. For example, in cases of Bulgaria, Hungary, Croatia, Slovenia, Greece, and Austria, the Commission has decided that bi-lateral treaties on South Stream construction are against EU law, thus, negotiations have to start from the very beginning. All the money spent on cold buffets during negotiations was wasted…

Would you like to have new designer jeans, but you cannot afford them thanks to your economic situation? You do not have to go to a second hand store. Poor Europeans can lease them now. Good jeans now don’t have to cost 100 euros in cash. You can pay only 20 euros of deposit and monthly payments of 5 euros. After a year you can decide, whether you want to buy them, change them for different ones, or return them.

What a splendid idea! Maybe even the ECB will accept jeans leasing as collateral. Wishing you no need for jeans leasing,

Martin Vlachynský
Translated by Roman Ujbányai