The Basel Committee on Banking Supervision is an institution created by the central bank Governors of the Group of Ten nations . It was created in 1974 and meets regularly four times a year. Its membership is now composed of senior representatives of bank supervisory authorities and central banks from the G-10 countries (Belgium, Canada, France, Germany, Italy, Japan, the Netherlands, Sweden, Switzerland, the United Kingdom and the United States), and representatives from Luxembourg and Spain. It usually meets at the Bank for International Settlements in Basel, where its 12 member permanent Secretariat is located. The Basel Committee formulates broad supervisory standards and guidelines and recommends statements of best practice in banking supervision (see bank regulation or Basel II Accord, for example) in the expectation that member authorities and other nations' authorities will take steps to implement them through their own national systems, whether in statutory form or otherwise. The purpose of the committee is to encourage convergence toward common approaches and standards. Dieter Kerwer reports that "the BCBS is not a classical multilateral organization. It has no founding treaty, and it does not issue binding regulation. Rather, its main function is to act as an informal forum to find policy solutions and to promulgate standards." (pp 619) [1] The present Chairman of the Committee is Nout Wellink, President of the Netherlands Bank[citation needed], who succeeded Jaime Caruana of the Bank of Spain on 1 July 2006.[citation needed]Basel Committee on Banking Supervision
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Take a moment to think about this. How much do you know about this committee? Who are its members? How often to they sit? Where do they meet? And what is its real agenda?
Whether you know anything about it or not, it is part of our government.
We touched on some of these organisations in an earlier post, when we gazed on awe at that mysterious creature, "dual international quasi-legislation", which one of our readers promptly christened the "diqule". Through this – and other mechanisms - our lives are ruled.
Of all these organisations which spawn their "diqules" and rule our lives, the Basel Committee on Banking Supervision is particularly interesting.
We know something of its ways, not least that it is not a "classical multilateral organisation" – meaning it is not a treaty organisation.
We are informed that the British were particularly keen advocates of its latest settlement, the Basel II accord. What is meant by "the British"? Are we talking about the government, are we talking about the Bank of England, or what?
Specifically, who authorised our "delegation" to negotiate on our behalf, against what mandate, with what authority to compromise? To whom were our negotiators responsible and to what level of scrutiny were they subject? And who authorised and accepted the final accord?
Actually, we know the answer to that last question – the European Union. It turned the accord into EU law which was then, via that medium, transposed into UK law.
With all these organisations dipping their nibs into the legislative pot, however, there is one notable and glaring exception - the British Parliament.
Out there, we have this vast, shadowy government. We barely know a fraction of its institutions, we know little about who runs them, we do not know their rules of procedure, the extent of their powers, when they meet, how they reach their decisions or even, sometimes, when they reach those decisions. Sometimes, it is years before their malign force is felt.
What we do know is that they are not transparent, not democratic and not accountable – yet collectively they wield unimaginable power.
Saturday, March 24, 2007
The success of the EU
Last year, I introduced the world to a major new discovery, the "dual international quasi-legislation/comitology mechanism".
Despite my considerable bravery in venturing so far up the hitherto unexplored reaches of bureaucracy, to bring back news of this species, my discovery was not exactly lauded and I have yet to be awarded life membership of the Royal Society. Yet, in this creature, which is far more common than most would even begin to imagine, lies the real reason for the success of the European Union – and yes, I do mean success.
Furthermore, it is the reason why the EU will continue to be successful, right up until the day when, for reasons entirely unrelated to is main activities – and anything the Eurosceptic community might do - it will collapse.
Now, for the one reader left, that hasn't walked away in disgust, let me explain six things.
Firstly, at the heart of modern government (in fact central to all levels of government, local to international) is a terrible secret. Government is boring. In fact, it is more than boring. It is mind-numbingly, crashingly tedious - the sort of tedium that, if it was instituted as a form of torture would even be banned by the Peoples' Republic of China as inhuman.
Secondly, most government is invisible. What you see on the television and read in the newspapers is only the tiniest fraction of what actually goes on. We get to know about less than one percent of one percent, and the politicians even less. And so boring is it that we don't even want to know.
Thirdly, most politicians have no aptitude for government and few even understand how it works. They are, therefore, in the main, entirely content to let their officials run the nuts and bolts, while they act as front men for the system, going on the jollies and working the media.
Fourth, the European Union has become part of a nexus of legislative bodies, linking international agencies of the United Nations with regional, national and local bodies, to form one continuous, seam-free administrative machine. So embedded is it in the administrative fabric of this and other nations, that the national systems could not function with it.
Fifth, this situation, far from being unwelcome, is highly convenient to the ruling and administrative classes. It saves them no end of work and relieves them of the obligation of having to pay lip-service to democratic procedures.
Sixth, the system acts as a useful lightning conductor, diverting dissent into the labyrinthine maw of international institutions, where activists can be contained, absorbed and then neutralised (or bought off), leaving national actors untroubled… you can always blame the EU.
Over and above that, the system is now so complex that no one (not even the players) really understand it, so no one will be brave enough to touch it in case they break something they don't know how to fix. And, since it defeats even the players' attempts, the critics do not have a chance. The likes of Eurosceptics can be left to blather uselessly round the edges, their criticism so unfocussed and wide of the mark that it has little effect.
Here, one can take a core objection of the sceptics – that sixty, seventy, or is it eighty percent of our laws are now "made in Brussels". Much of this, of course, is dry technical stuff, like the dimensions of rear view mirrors on busses, the composition of cheeses from various regions, or the level of permitted toxic emissions from crematoria.
Now, while this sort of law may come from "Brussels", it would be more accurate to say that it has a Brussels label. But the bulk are no more EU than they are national laws.
Behind that screen, there are hundreds – possibly thousands - of what are known as "quasi-legislative bodies", working on a global and regional scale. These act under the aegis of organisation such as the OIE, which deals with animal health issues, CODEX alimentarius, created in 1963 by FAO and WHO to develop food standards, guidelines and related texts such as codes of practice, the IPCC which, of course, deals with climate change matters, and the World Health Organisation, which deals with public health and infectious diseases. 
Another of these fascinating organisations isUNECE, the United Nations Economic Commission for Europe – with not 27 countries but 56, including Turkey and Kazakhstan and also, for historical reasons, the United States.
One of its particular functions is to deal withtransport, acting via a skein of agreements and conventions, such as the "Agreement Concerning the Adoption of Uniform Conditions of Approval and Reciprocal Recognition of Approval for Motor Vehicle Equipment and Parts, done at Geneva on 20 March 1958", copy here.
It is actually through this Agreement that international standards are worked out for things like the size of rear-view mirrors for busses, which are then handed down to the EU, which implements them as law in the Member States.
The standards themselves are not law, but become law in the EU once implemented, which is done through the comitology system, the twin-track process – through UNECE and the EU – which has acquired the rather cumbersome title of "dual international quasi-legislation/comitology mechanism".
Interestingly, the EU does not get a look in when it comes to formulating these standards, but countries like Norway do. The EU is then used to write the specific legislation for Norway as a member of the EEA. So much for "fax-machine" law. The commission is simply acting as a service provider, making laws for states which have already agreed at a higher international level to implement them.
That digression aside, so useful to the member states are the technical/legislative services provided by the EU – and so necessary are they to the functioning of modern economies – that it is unthinkable that any member state could or would even wish to dispense with them.
Therein lies the genius of the European Union. It has harnessed these essential administrative functions to its own ambitions, creating structures and institutions to deal with them in the hope, one day, they will be transformed into something more than a technical organisation. Then, they hope, the EU will be able to assume wider responsibilities in the "high" political areas which include foreign policy and defence.
As we observe, so far the Union has been successful. It is still in the game, its ambitions are intact and it is exercising power. How far it goes will depend on whether it over-reaches itself – or the Member States allow it to do so. Its potential nemesis lies in precisely its ambitions to take on board the "high" politics spectrum. The more it achieves, the more vulnerable it becomes.
If it continues on this path, there will come a point where the number of people it upsets will outnumber those who appreciate its value. The balance of utility will have changed and the EU will go. Strangely, therefore, losing out on the Constitution was the best thing that could have happened to the EU. But the "colleagues" can never leave well enough alone – they will keep trying and, in the fullness of time, they will reach that critical tipping point in the balance of utility.
That is why the EU is not going to last another fifty years.
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