This is an edited version of my column in Monday's Irish Daily Mail --
Somewhere between four and five a.m. at the last European Council meeting, I was slumped in a chair alongside a colleague in the press centre. We were waiting for the prime ministers upstairs to come out of their meeting with an agreed position on the EU budget.
We were also calculating at what time the cafeteria might open for breakfast, and the chances of a poached egg.
But mostly we were calculating the number of empty seats where once there were Greek journalists strapped in for the night: ‘See,’ said my colleague, ‘the crisis is over. If Greece or anybody else still looked like they were going to crash out of the euro, all the Greeks would be here. And they’re not. It’s over.’
I replied: ‘Can’t be. The fundamentals haven’t changed.’
And yet in my pre-dawn groggy-headedness, I had to wonder if something really had changed. I wondered if I were in fact just nostalgic for the crisis atmosphere. The title of memoirs by Anthony Loyd, a war correspondent who had covered the Balkans conflict, came to mind: My War Gone By, I Miss it So.
Yes, you can indeed miss (as listed by the Literary Review) ‘a stench of blood, excrement, mortar-fire, slivovitz and human bestiality.’ Four out of the five of those and you’re covering the eurocrisis.
But the events of the past week have shown the lull was indeed just that, a lull. The fundamentals have not changed. They are in fact getting worse: France has now joined the countries which will miss their deficit targets. Spain’s fourth-quarter economic statistics showed a dramatic decline in all sectors, including exports. Capital Economics last week forecast that the Italian GDP will fall by as much as 3.5 percent over the year. This comes after last year when, according to the Financial Times, Italian GDP was already down at levels last seen in 2000.
The economy of the eurozone as a whole continues to shrink at an ever-faster rate. Nineteen million workers in the euro area are unemployed. Lombard Street Research warns that gains in cost competitiveness in the Club Med countries are coming at the expense of extreme levels of unemployment: ‘Prosperity through depression cannot be achieved.’
And Ireland? Ireland's GNP, the only worthwhile measurement of its economy, is shrinking. Disregard the GDP growth the Finance Minister pushes. As Constantin Gurdgiev, an economist from Trinity College Dublin, noted in an Open Europe debate in Brussels last week, ‘In Ireland, GDP accounts for nothing. GDP is not a metric of actual economy in Ireland whatsoever, primarily because about 20 to 28 percent, depending on the quarter, of that GDP is transfer pricing by multinationals which flies out of the door with no taxation impact.’
‘So GNP is a better metric. And GNP is in 2012 going to be down, not up. It is contracting, it is contracting at a faster rate than the eurozone economy GDP is contracting. In 2013, the most rosy projection we have is about half a percent growth in GNP. If you think that that is a sustainable poster-boy best of the class kind of stuff for an economy where the government debt is 120 percent to GDP ratio, or 144 percent to GNP ratio, good luck to you. The internal economy is completely zombie-fied, domestic demand is shrinking every year from 2008 through 2013 projections.’
And that’s in Ireland, the country meant to be the ‘success story’ of the eurocrisis.
So the eurocrisis was bound to kick off again, and it has. If you’re looking for the mortar-fire, I give you Beppe Grillo, the anti-EU Italian whose Five Star Movement has come out top in the Italian elections. Put him alongside the anti-euro Silvio Berlusconi’s party, and between the two of them have won a majority of votes in the third-biggest eurozone economy.
Italians were voting against EU-inflicted austerity, against the single currency. And they were voting against the outgoing prime minister, Mario Monti, a former European Commissioner who was parachuted into the job by manoeuvrings between the commission, the European Central Bank and the German chancellor.
The three pushed out the democratically-elected Berlusconi because they despised his refusal to bow to their demands for austerity. They dropped in the unelected EU-technocrat Monti instead, and expected gratitude for doing so.
Funny how ungrateful some occupied people can be: given their first-ever chance to vote on Mr Monti and his ‘list’ of candidates, 90 percent of Italian voters rejected him.
And if you don’t think the EU institutions consider that kind of democratic result an act of war, you probably think Pearl Harbour is a Japanese fishing village.
For the euro-elite, if you’re not with us, you are the enemy: you are ‘a dangerous nationalist.’ You are ‘anti-European.’ You want ‘a third European Civil War,’ fascism, etc, etc, yaddah-yaddah-yaddah (they’ll shut up once you get scared enough and capitulate).
Yet now we have the Italian result: the Italians clearly aren’t scared enough. Their anti-EU result stands alongside the invigorating result in the English by-election on Thursday which pushed the Tories led by pro-EU David Cameron into third place behind the United Kingdom Independence Party.
We also have the fury on Saturday of the Portuguese people who were out in their streets by the hundreds of thousands. They were out to protest against the EU-inflicted austerity measures. Their banners said: ‘Portugal to the polls!’ Portugal is, like Italy, demanding democracy.
What the euro-elite are doing right now is figuring out how to stop it.
They already have plenty of powerful undemocratic institutions in place to control the lives – the economies, the tax revenues, the businesses, the credit, the lot – of the people caught in the EU, and particularly in the eurozone. You can reckon they will be pulling the levers on all of them to keep their project on track, despite voters’ demands to stop. (You must understand that for the euro elite in this war ‘human bestiality’ means the voters.)
Just some of the institutions which no voter can touch, but which now have power over us, are listed in the introduction the new edition of The Rotten Heart of Europe, the most courageous book ever written about the European Project.
It was written in 1995 by Bernard Connolly, a British economist who used to be head of the European Commission’s Monetary Affairs Committee. He was there with the eurocrats when they were constructing the euro. When he saw the disaster that was being created, he went public with his fears and wrote the book.
The Wall Street Journal interviewed Mr Connolly last month: ‘His public confession of fear that the monetary union would inevitably produce an economic crisis not only cost him his job, he says, it also cost him his pension, and he was barred from his office even before his dismissal was official…Mr Connolly describes how his photograph was posted at entrances to the commission’s offices, as if he were a wanted criminal.’
I had a few hours with Mr Connolly some years ago. What the commission did to him was more, and worse, than just losing his job and his pension. When he tried to fight this at the European Court of Justice, the commission cited British laws against blasphemy to justify their actions against him. We can leave it at that.
The book was accurate, informed, and prescient. Now the publishers have brought out an updated edition, with a new introduction by Mr Connolly: ‘The crisis of the euro – a wholly predictable and indeed inevitable crisis – has been seized on eagerly by the European nomenklatura to justify the suppression of referendums, the eviction of democratically-elected governments in manoeuvres reminiscent of Stalin’s tactics in Eastern Europe after the war, their replacement by technocrats, and, above all, the transfer of ever more extensive powers to the unelected, unaccountable and explicitly anti-democratic bodies: the Eurogroup; the European Central Bank (ECB); the European Financial Stabilisation Facility (EFSF); the European Stability Mechanism (ESM) – which, astonishingly, has complete legal immunity for itself and its officers; the International Monetary Fund (IMF); the G20; the various banking and financial supervisory bodies; and the projected ‘economic government’ of the euro area charged with ensuring fiscal “discipline.”’
‘The outcome of monetary union has thus been, as predicted explicitly in this book in 1995, the destruction not only of prosperity but of political legitimacy, in every country in Europe…’
I sniff the air and get the stench of blood. My war is far from over.
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