The EU debate - Part III

http://moneyweek.com/brexit-is-not-the-eus-biggest-problem/

Everyone’s trying to work out what’ll happen next in the Brexit story.

Blood-curdling tales abound of the terrifying vengeance that Europe will now inflict on us for daring to reject it. If Brexit has a soundtrack, then the Human League’s Don’t you want me, baby? is about where we are now.

But while I realise that this is difficult for some people to get their heads around, nothing in this negotiation is set in stone. That’s the nature of negotiations.

The idea that the EU simply gets to set the terms here with no compromises is naïve – or even wishful thinking on the part of those who want to see Brexit fail badly.

Yes, you can stick two fingers up to the impudent, unhelpful Brits. But what are you going to do when the Italians – who share your core currency – decide that they want to leave? What’ll you do when the French – one half of the Franco-German heart of the EU – decide that they’ve had enough?

I’d take this chance to work on a plan that keeps them all sweet, to create a more forgiving EU that genuinely works together to create a harmonious relationship between the states.

The sort of EU that would give Greece free rein to leave the euro but offer debt forgiveness and massive financial support for the new drachma. The sort of EU that feels secure enough in its existence that it doesn’t feel it has to steamroll over any and all objections from the citizens of Europe. The sort of EU that sees the voters as its primary concern, rather than an inconvenience.

The sort of EU that any country would want to be part of, in other words.

Can they get to that point? It seems a tall order. But we’ve got more than two years to make a few steps in that direction. And between now and then, France, Italy and all the other potential rebels in the EU are not just going to sit and behave until Britain has been dealt with.

 

Nonsense.

 

Strange article. Describing every member of the EU as a potential rebel is like a nutter feminist describing every man as a potential rapist. It seems to imply Brexit will give the EU the kick up the arse it needs to be the sort of EU we'd want to be a part of. Terrific.

 

That's nothing more than the meaningless ramblings of Stepek. Who was an avid Leave supporter.

 

https://sputniknews.com/europe/201607081042639342-italy-crisis-eu/

Financial Crisis in This EU Country May be Bigger Problem Than Brexit

While all eyes have turned to Brexit a major political and economic crisis is mounting in another European nation, Italy, an article in Business Insider read.

"Italy is on the cusp of tearing Europe apart but the economic and political crisis brewing in the nation is largely going unnoticed," the article read. According to the author, a quick look at the country’s economic data, banking crisis and the upcoming constitutional referendum is enough to understand that "Italy is like a bomb waiting to explode." "Italy is Europe’s fourth-biggest economy and one of its weakest. Public debt stands at 135% of GDP; the adult employment rate is lower than in any EU country bar Greece. The economy has been moribund for years, suffocated by over-regulation and feeble productivity," according to The Economist.

Brexit Makes Europe a 'Mockery of the World Economy' Since Britain voted to leave the European Union concerns about both the Italian economy and the entire EU financial system have multiplied. Financial analysts warn that the turmoil in Italy could spread across Europe in a domino effect, an article on Express.co.uk read.

Moreover, in October, Italy will hold a referendum which would be of equal importance to the Brexit vote. The results of the referendum would have a serious impact on Italy and the situation across Europe. The Italians will have to decide on a reform to the country’s Senate, the upper house of the parliament. If approved the proposed reform would change the formation of the Senate, accumulating power in the lower house. The referendum will be "probably the single biggest risk on the European political landscape this year among non-UK issues,
" Citi analysts noted. Analysts note that the reform would speed up the lawmaking process in Italy. Currently, both houses of the parliament have similar lawmaking authorities, creating hurdles for approving new laws.

Italy ‘Should Return National Currency' to Revive Its Economy If the reform is approved this could improve political stability in Italy and help Prime Minister Matteo Renzi to push through laws aimed at improving the country’s economic capabilities, the article in Business Insider read. But if denied there is the possibility that Renzi’s government will fall. This would spark political chaos Italy has not seen since the Silvio Berlusconi’s resignation. "If the referendum is rejected, we would expect the fall of Renzi’s government. Forming a stable government majority either before or after a new election could become extremely challenging even by Italian standards," Deutsche Bank analysts wrote in a note to clients. A political crisis can also spark financial and economic turmoil. According to estimates of the General Confederation of Italian Industry, if the reform is rejected, it would push Italy into recession, lead to massive capital flight, and increase Italy’s debt. According to BI, "Italy simply cannot afford any of those things at the moment" since the country is seeing a massive banking crisis. "Amid stagnation and deflation, Italy’s banks are in deep trouble, burdened by some €360 billion ($400 billion) of souring loans, the equivalent of a fifth of the country’s GDP," The Economist reported.

"Contagion was the problem that really was large in 2007 and beyond, and I think that will be something of a concern. And if there were to be a systemic failure in Italy on a major scale then there would be that risk of contagion spilling out through the other European banks," Jeremy Stretch, Head of FX Stategy at CIBC told Euronews.

The problems of the Italian banking system could spark recession in the country which would immediately hit the entire European Union like it was at the heights of the Greek debt crisis.

"One theme which could dictate near term direction for markets and which arguably Brexit has reignited and brought back to the forefront is the ailing and fragile state of the Italian banking sector," Deutsche Bank's Jim Reid wrote. The burden of bad loans in Italy is so enormous that the government in April established a fund to support its weakest banks and forced bank executives and investors to put €5 billion ($5.57 billion) into it. For instance, Monte Paschi, the world’s oldest and Italy’s weakest bank, has bad loans of €47 billion, a headache for the European Central Bank. "The Italian financial system is teetering on a precipice without much hope of a solution. Brexit may be the biggest problem facing Europe right now, but Italy isn't far behind," Business Insider concluded.

Read more: https://sputniknews.com/europe/201607081042639342-italy-crisis-eu/

 

It's mostly opinion and supposition by a guy who seemingly has a history of writing sensationalist articles for both Money week & The Spectator.

The EU has not been a failure. The single currency however, most certainly has!...

 

Now or never: European Central Bank chief orders nations to fix EU problems or FALL
THE EUROPEAN UNION is deepening discontent across all member states with its failure to tighten external borders, co-ordinate defence policies and tackle inequality, according to European Central Bank President.

Mario Draghi said EU leaders are reversing progress made in recent years with policies which “have at times been reminiscent of the interwar period: isolationism, protectionism, nationalism”.

Mr Draghi called European policies such as Schengen "incomplete" and plans for integration “dangerous".

The bank chief revealed concerns over how member states are losing powers in areas such as border control.

But Mr Draghi said the EU is taking away autonomy, but failing to provide anything equal or better as a replacement.

The ECB chief has spent several years telling governments that they should use the breathing room granted by low interest rates to reform their economies to boost employment, productivity and growth.

His advice has not been adhered to - and now he is describing economic problems as a threat to the political project’s viability.

He said: “The more recent years of the European project have been characterised by growing dissatisfaction.

“For some EU countries, these years have entailed the most serious economic crisis since the war, with unemployment, especially among the young, reaching unprecedented levels and welfare states constrained by low growth and stretched public finances.

“Consider the Schengen Agreement. It largely abolished Europe’s internal borders, but it did not envisage a strengthening of the continent’s external borders. So when the migration crisis erupted, it was seen as a destabilising loss of security.”

“The response of both the EU and the member states to these needs and fears has so far been insufficient. Surveys show that, together with a drop in support for economic integration, trust in both the EU and even more so the member states has fallen.”

http://www.express.co.uk/news/world...al-Bank-chief-orders-fix-EU-problems-FALL-ECB

 

Italy's woes having absolutely zip to do with our potential economic equivalent of shooting yourself in the foot, if we lose access to the single market.

Pointing at the Italians are shouting 'look they ****ed it up as well' isn't going to soften the blow.

 

It could if it pulls the EU down with it. There wasn't a status quo remain option.

 

As much as you'd love to think that's a possibility - it isn't

The euro could well fail and be canned in certain states, but the EU will still be the trading bloc for our neighbours across the channel.

Meanwhile the pound is worth less than soil

 

I would love to think the current structure of the EU will collapse that's correct. Some inside are claiming that it's a very real possibility unless it changes radically. 'Remain' wasn't a real option.

 

Do you not think that the demonising of Islam by right wing media and the fact that the USA, UK and France are bombing the #### out of the ME might have something to do with that.

 

Shocking logic.

If the euro fails that wouldn't alter the value of the trading block as an entity. If the euro had failed whilst we were still a member it wouldn't have affected us, as we're not part of the Eurozone and have zero liability for bail outs.

If pressure came from within the EU to alter freedom of movement - as the other article intimated, then the prime reason for voting out in the first place by many (not you apparently before you start) would have been negated.

Instead we'll sit on the outside dealing with WTO tariffs, our manufacturing base and financial sector ****ing off over to the mainland, rising inflation, increased unemployment, and undoubtedly the Tories slashing public spending as a result. No mate, there was no 'remain' option at all

 

The Remain option is a false premise, as even those within know it's failing and in need of radical change. If that change is obstructed, then we're better off not yoked to it.

It's why the claims of economic doom are false when they're laid at the door of a yet to occur Brexit, and the predictions fall because they're generally compared to what can only be a fictitious version of the EU

 

Haven't we gone down this route before where you claim Remain was a leap into the unknown. I agree it is to the extent my next commute into work is also a leap into the unknown as the train might crash or someone might blow up Euston station at 8:45.

 

Your faith doesn't match the reality based on views of those involved.

 

I said non-whites. I didn't mention blacks.

Why did you automatically assume that the term "non-whites" meant "blacks"? Isn't that a very narrow minded way of looking at humanity ie there are whites and anyone who is non-white is black?

 

Absolute total bollocks!

Congratulations, you've excelled yourself!

 

As ever.