Thread: Germans Try To Destroy The British Pound

GERMANS TRY TO KILL OFF POUND


Wolfgang Schauble predicted all Europe would one day use the single currency

Saturday November 19, 2011
By Macer Hall
Have your say 148

BRITAIN will soon be forced to scrap the pound and join the euro, one of Germany’s most senior figures said yesterday.

In a chilling threat to UK sovereignty, German finance minister Wolfgang Schauble predicted that all Europe would one day use the single currency. “It will happen perhaps faster than some in the British Isles currently believe,â€

Germany tightens the screw on 'isolated' Britain as tensions soar

Talks between Merkel and Cameron lay bare fundamental differences over plan for euro

Nigel Morris and Tony Paterson
Saturday 19 November 2011



An anti-British backlash gathered pace in Germany yesterday as David Cameron and Angela Merkel struggled to disguise the gulf between them on how to tackle the eurozone crisis.

The Prime Minister returned from talks in Berlin with the German leader having made little progress in agreeing emergency action to stop the financial contagion spreading.

Tensions were inflamed after a close ally of Ms Merkel predicted Britain would eventually adopt the euro.

The German media joined the clamour, with the mass-circulation newspaper Bild questioning whether it might be better for Britain to leave the European Union altogether.

Behind the leaders' smiles at a joint press conference yesterday, they acknowledged fundamental differences remained on three key issues:

* New eurozone rules. Ms Merkel called for "limited" changes to European treaties to impose fiscal discipline on the single currency but stressed negotiations should only be for eurozone members. Mr Cameron wants Britain involved in the talks because of the potential impact of the decisions on the UK;

* Whether the European Central Bank should intervene to support the eurozone. Ms Merkel – backed by the German public – is fiercely resisting the move, which she fears would fuel inflation. But Mr Cameron insisted that all the eurozone's institutions had to "do what is necessary to defend it";

* Taxing financial transactions within the EU. Ms Merkel supports the step but Mr Cameron fears it would disproportionately hit the City and said it would work only if applied globally.

The Prime Minister said: "It is obvious we don't agree on every aspect of European policy, but I am clear we can address and accommodate and deal with those differences."

He also stressed the two leaders were "very good friends" and "absolutely" in agreement on the importance of completing the single market, budget discipline and stopping EU spending from rising by more than inflation.

But shortly before Ms Merkel also paid tribute to the "strong bonds of friendship" between the countries, her veteran Finance Minister used less diplomatic language in which he seemed to predict the end of sterling.

Wolfgang Schäuble told the news agency DPA it was Britain's right to remain outside the eurozone "for the time being".

But he said it was a matter of time before non-eurozone states became convinced of the euro's advantages. "One day the whole of Europe will have a single currency and perhaps it will happen more quickly than many people on the British island think," he said.

Meanwhile, in an article headlined 'The Sick Empire', Der Spiegel magazine described Britain's plans to eradicate its budget deficit by 2015 as "utopian". It added: "The situation on the island is more dramatic than in parts of the continent. It's bad news nearly every day.

"But the British government gets away with it by proclaiming carry-on-as-usual policies and by blaming its economic stagnation on the eurozone."

The war of words between Berlin and London erupted on Tuesday after Volker Kauder, Ms Merkel's parliamentary party leader, lambasted Britain for being too self-centred on Europe.

"Just looking for their own advantage and not being prepared to contribute – that cannot be the message we accept from the British," he told a congress of his ruling conservatives.

The former Prime Minister, Sir John Major, weighed in behind Mr Cameron last night as he condemned the financial transaction tax as "a heat-seeking missile...aimed at the City of London". He also warned of an "undemocratic" move towards eurozone fiscal union.

In an interview with Al Jazeera, he also predicted "one or two countries" would be forced to quit the euro.

Douglas Alexander, the shadow Foreign Secretary, said: "David Cameron is leaving Berlin just as isolated as he was when he arrived. "That is a genuine concern for those of us who want Britain to be a strong and, indeed, leading voice in trying to find a way forward."

Great Divide: Tensions behind the soundbites

Cameron

On taxing the banks

He said: "The danger, we have always believed, is driving transactions to a jurisdiction where it wouldn't be applied. So a global tax would be a good thing, but in Britain also we have put in place stamp duty on share transactions, a bank levy."

He meant: Unless there is a global agreement on a "Robin Hood tax", then countries without it – probably in the Far East – will be the biggest winners as financial services are likely to head there. And the biggest loser will be the City of London.

On intervention by the European Central Bank

He said: "All the institutions of the eurozone have to stand behind and back and do what is necessary to defend it."

He meant: Most importantly, that includes the European Central Bank. I appreciate the Germans' historical distrust of the move, only massive ECB intervention can calm the markets.

On treaty change

He said: "We had a discussion about the issue of the treaties and, as Angela has said, Germany has her interests and so does Britain."

He meant: There are plenty of hard negotiations ahead. If those of you with the euro intend to make agreements that will affect the rest of us, think again. We want to be involved in the talks over any new rules for the eurozone.

Merkel

On taxing the banks

She said: "We are at one saying that a global financial transaction tax would be implemented by both countries immediately. But just a European one, we did not make any progress. We have to both work on where we feel change is needed."

She meant: We Germans remain committed to a tax on financial transactions, but we're getting nowhere in persuading the British.

On intervention by the European Central Bank

She said: "The British demand that we use a large amount of firepower to win back credibility for the euro zone is right. But we have to take care that we don't pretend to have powers we don't have, because the markets will figure out very quickly that this won't work.

She meant: Even if I wanted to (and I don't) I haven't got the power to authorise the ECB stepping in. My Parliament, not to mention the German electorate, simply wouldn't wear it.

On treaty change

She said: "It is crucial... we develop more of a possibility of enforcing the rules of the European institutions so that national governments do abide by their commitments. A limited treaty change, only for the members of the eurozone, is of the essence."

She meant: I'm sorry, but if you're not in the single currency club, you can hardly take part in drawing up its new rules. However, rest assured we don't want a Lisbon treaty mark 2. A new bout of EU navel-gazing would be in no-one's interests (and risk referendums around the EU).

http://www.independent.co.uk/news/world ... 64596.html

Euro-US Cold Winter... Seething Anger

By Eric Walberg
11-18-11

The eviction of demonstrators last week is an ominous metaphor for ruling elites, whose own days are surely numbered, ponders Eric Walberg

As protesters fed up with the increasing injustices of the global economic system get chucked out of their latter-day Hoovervilles, Euro-American elites might consider when their turn will come. For the financial crisis facing Greece, Ireland, Italy, Spain and who-knows-where next is really about who pays for the past three decades of largesse.

The popular perception is that the ordinary people have been living "beyond their means", a false and invidious conventional wisdom which masks the real nature of the crisis. For it is the elites across Europe and the Americas who have benefited most from the European Union, built on Reaganite neoliberalism, which in turn was fashioned to meet the needs of business. The neoliberal policies of all Western governments, "left" or "right" during the past three decades are the direct cause of the current highly skewed income distribution Â* by some accounts, worse than in any previous era of human history.

The supposed generous patriarch of this big happy family is Germany, with its hard workers and tidy streets. But while the Aesopian Greek hares are told they must tighten their belts and make do with less health and education, the fact that the Greek arms imports continue to grow -- importing German weapons and "defence" systems (against what threat?) -- is not mentioned. And it is not only weapons, but consumer goods from Germany that have displaced Greek products in the anonymous Euro-market, as Greece increasingly becomes northern Europeans' decadent playground, albeit with more than its fair share of un- and under-employed.

As long as banks were lending freely to governments to finance this fool's paradise, the lower classes were not made to feel the pinch, and the system kept chugging along. Now that government debts and bank reserves have approached their limit and reckless banks are going bankrupt, the struggle is on over who should pay for the untenable system. Since the economic elites are also the political elites, naturally they want the broad people to pay with social service cuts, reduced and delayed pensions, regressive sales taxes and the like. The intense propaganda campaign now underway is to convince the poor in the Euro-laggards that they are the guilty ones, not their own elites or the Euro-elites in Frankfurt or Berlin or wherever.

The EU was a project to end the prospect of war in Europe and to gather the broken pieces of shattered empires into a workable collective economic-political force in the world. To a surprising extent it succeeded, but without facing hard choices and a frank debate about who benefits. As the problems sharpen, any sense of collective goodwill evaporates, and chauvinist, even racist parties gain rapidly in popularity, hearkening back to faux-halcyon days of distant imperial privilege. But as history shows, the ability of individual European countries to extract surplus from colonies is not guaranteed indefinitely. The same goes for the ability of Germany to lord it over its Euro-partners. As the knives come out, the very existence of the European project comes into question.

The rich standard of living that Europe has enjoyed over the past few decades is directly a result of first the import of Third World workers (to a large extent Muslim) and then the incorporation of the ex-Socialist bloc after the collapse of the Soviet Union in 1991. As the financial crisis plays itself out, these immigrant workers, the very ones who have served Europeans so well, are now targeted and racially profiled, as the elites try to deflect attention from their own hidden role in the ongoing crisis. This is the First World/ Third World extension of the above argument about Euro-laggards, with the victims no longer the Greek hares, but Nigerian and Egyptian immigrants.

A similar tale can be told for the US, with its large immigrant population, its Tea Partiers and Islamophobes, unable or unwilling to face the underlying problems resulting from decades of neoliberal policies. In the Americas, it is China that provides the manufactured goods which are paid for by US treasury bonds piling up in Chinese bank vaults, and no one in particular is accused of being the carefree Aesopian hare -- state governments merely use their deficits as the deus ex machina -- but the pattern is the same.

As the people who have woken up to the reality are arrested and booted out of Trafalgar Square, Zuccotti Park, Chapman Square (Oakland) and dozens of other city commons around the world, the long cold winter of discontent sets in. However, the problems are going nowhere and the people are just waiting for the next opportunity to express their outrage.

The toppling of governments means nothing in this scenario. Italy's Silvio Berlusconi and Greece's George Papandreou only handed over power on the explicit understanding that the "fresh faces" would carry out the austerity plans imposed by the EU heavyweights. Berlusconi's replacement is 68-year-old ex-EU commissioner Mario Monti, an economics professor steeped in the dogmas that brought Italy to its current impasse. Papandreou's replacement is ex-European Central Bank vice president Lucas Papademos who immediately announced, "Our membership of the euro is our only choice." Not much thinking outside the box from these folks, the very ones who got their people in their present fix.

Some Americans at the top are already awake. The 138 members of "Patriotic Millionaires for Fiscal Strength" (0.005% of all US millionaires) have been lobbying President Barack Obama and congressional leaders for a year now pleading with them: "Please do the right thing, raise our taxes." Not surprisingly, no response from a president and Congress beholden to the 3.1 million other millionaires -- the proverbial 1%.

Occupy Washington DC published their no-brainer proposals 17 November: redistribute income through progressive taxation, end the wars, expand health care, democratise business. This will end the budget deficit overnight, create full employment through stimulating local demand, eventually ending the foreign trade deficit, making America strong and once again the envy of the world. But of course Congress is captive of the current military industrial complex, and can and will do nothing.

The slow-motion drift into oblivion is surreal. Clearly momentous changes are in store for both Europe and America, and the sooner thinkers and actors get to work coming to grips with hard, cold reality, the better for the people -- and for the elites, who are living on borrowed time, too. How long before the revolution?

http://www.rense.com/general95/euro2.htm