After months of posturing about what he ludicrously claims to be the soundness of his economy, Silvio Berlusconi finds his head on the same block where George Papandreou’s has just been hacked off. If the Brussels-backed putsch against Mr Papandreou was supposed to signal the beginning of the end of the euro crisis, it failed. To start with, it is still unclear exactly where the one trillion euros the G20 summit in Cannes last week agreed would stabilise the currency is going to come from. Also, just because Greece is apparently under control again — and, I repeat, just how ‘under control’ is questionable — does not mean the euro is saved. When the bond traders woke up yesterday, they turned their attention to Italy and greatly disliked what they saw. Sure enough, bond yields — linked to the rate of interest Italy pays to those financing its debt — reached a level higher than at any time since Italy became a founder member of the euro in 1999.This is because the country is struggling to find investors to fund it, because its economic policies are unsustainable. The European Commission in Brussels, and Europe’s paymasters in Berlin and Frankfurt, look at Italy and tremble. Greece, whose economy is one-seventh the size of Italy’s, has been a picnic compared with what would happen if Italy went under. Grave concern: The sheer size of an Italian default could break the euro This is not merely the next big chapter in the story of the decline of the euro. It is possibly the biggest chapter of all: for Italy can break the currency and, with it, alter the whole course of what, for the moment, is the EU. Consider the turmoil already caused by Greece’s problems, for which a new bailout fund of 440 billion euros has been deemed sufficient (with small change left over for the expected needs of Ireland and Portugal). Italy owes 1.9 trillion euros. Its debts cost the best part of 300 billion euros a year to service. The potential problem there is on a wildly different, and indeed terrifying, scale. Having mounted one coup, there is no reason why the EU shouldn’t mount another. Indeed, given the potential Italy has to derail the entire European project, it is doubtless seen in Brussels and Berlin as even more important to have order restored in Rome than it was in Athens. In Greece, an unknown called Lukas Papademos is mooted as leader of the new government of ‘national unity’. As a former high official of the European Central Bank, he is a technocrat and not a politician, and therefore can be relied upon by the other faceless officials of the European Commission and the ECB to do exactly as he is told now and in the months to come. In Rome, the talk is of Mario Monti replacing Mr Berlusconi if Italy’s present prime minister is evicted — for example, if his latest budget is voted down today. Mr Monti is a former EU commissioner, so he, too, is deemed Brussels-compliant. This chatter about a new leader is itself destabilising, and one can only speculate on whether Brussels’ fifth columnists in Rome are whipping it up in the hope of propelling Mr Berlusconi towards the exit. He is a repellent figure and his spending policies have done untold damage to his country, but it is up to Italy to remove him and no one else. What we are witnessing is the economic colonisation of Europe by stealth by the Germans. Once, it would have taken an invading military force to topple the leadership of a European nation. Today, it can be done through sheer economic pressure: it might be that within a few days the Germans — along with their French allies — will have secured regime change in the two most tiresome countries in the eurozone. They have already achieved it in another, Ireland, where the new post-bailout prime minister, Enda Kenny, has followed the euro-script to the letter and therefore looks safe in office. Mr Kenny is a former vice-president of the federalist European People’s Party (EPP), so he understands the role Brussels expects him to play. When these coups in the leadership of major countries occur, the markets swoon with relief: but they change only the political fundamentals and not the economic ones. Even if Mr Berlusconi goes, Italy will still have unsustainable debt and, when the joy of his departure wears off, it will still be forced to offer unsustainable bond yields to refinance that debt. Perhaps the Germans, as the new masters of Europe, have been lulled into a false sense of security by Ireland’s response to the savage austerity measures imposed upon it in return for its bailout. The Irish are far from happy, but there has been nothing like the Greek civil unrest and riotous behaviour on the streets of Dublin — so far. Whether the Greeks will swallow the austerity policy about to be imposed on them by the Fourth Reich’s new Gauleiter there remains to be seen. Given the expressions of anger already seen in response to previous milder measures, one must suspect not. And how will Italy respond to more austerity if Berlusconi falls? How would the slab of the country south of Rome, where the Cosa Nostra are effectively the tax collectors, contribute more in their country’s hour of need? The EU can change regimes as much as it likes, but unless the regimes stop spending and start repaying debts, the problem with the currency will continue, bailouts or no bailouts. This is especially true in Italy’s case, for only the strictest austerity — far beyond anything attempted by Mr Berlusconi, and possibly even beyond what Mr Monti would receive in his orders from Brussels — can repair the damage. It suits the Franco-German axis to put its people in charge in such countries: not just because they will do what they are told now, but because they will do what they are told so long as they are in office. But even that will not be enough if the markets decide the economic fundamentals still do not inspire confidence. It is perhaps because the leaders of France and Germany, at least, know this that they are so keen on the International Monetary Fund coming in to help. They are lucky (? well planned? B&A) that the Fund’s new managing director, Christine Lagarde, the former French finance minister, seems determined to help shore up the euro project. And when the people realise what is being done to their democratic rights in the name of the future of Europe, one dreads to think what their reaction will be.Germany's economic colonisation of Europe
By Simon Heffer
8th November 2011
Struggling
Savage
Terrify
Friday, 11 November 2011
The elaborate pretence that the European Union and its stricken currency will shortly be saved after some little local difficulties is now becoming ever more desperate. The coup d’etat in Athens over the weekend, which saw the demise of the sitting government, is unlikely to be the last violation of democracy in the name of European unity. No sooner was Greece whipped into submission — though for how long and how successfully we shall see — than Italy was placed firmly in the line of fire.
Coup d'etat: Greek Prime Minister George Papandreou has been toppled by eurozone leaders
Regime change: Germany and her French allies are colonising Europe's economy by stealth
Ally: IMF managing director Christine Lagarde is determined to help shore up the euro project And yet diverting IMF money to help the euro would be an entirely improper use of such funds, because it would be as much for political as economic purposes. This is why, no doubt, President Obama signalled at Cannes last week that he was against expanding the IMF’s contingency for supporting the euro. Mr Cameron told Parliament yesterday, by contrast, that he is happy to do so. This only shows there are fifth columnists everywhere. They are not just Liberal Democrats like Nick Clegg and Danny Alexander, the Chief Secretary to the Treasury, who on Sunday voiced the Government’s approval of the IMF supporting the EU’s economic colonisation plans. What has happened in Greece, and what may be about to happen in Italy, should terrify all true democrats. That it does not terrify those who lead the EU shows, yet again, what a profoundly sovietised institution it is.
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