Stanley's blog

Solidarité

Maybe I’m old-fashioned but I still believe that a key quality of the European Union was ‘solidarité’ (a better word in French than English). With the ‘dog-eat-dog’ behaviour of the financial sector, was it too much to hope that EU leaders would set a good example? The market would have so much more confidence if there were true EU coordination.

A once reliable Germany said nothing at Saturday’s summit and next day announced a blanket guarantee to personal bank deposits. And London tried without success to get clarification from Berlin of the guarantee before the Asian markets opened Monday morning. Before that, Ireland and Greece acted unilaterally.

At stake is the future of the Eurozone and EMU. The action by Germany, previously impeccable in the monetary field – without consultation – undermines the authority of the ECB as well as the Member States, and can turn the financial meltdown into a crisis of the euro itself

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  1. I totally agree with you. But do you think there really are chances that EU members can trully coordinate their policies? After all we, are taking here about fiscal issues, national revenues, political traditions and settings, and so on. To be more precise, what part of financial policies should still be left for the states to decide upon?

  2. Solidarité

    An interesting word indeed, and one which no doubt conjures up a wide range of representations in different people of differing cultures at different times. Personally, this word, particularly in its French form, represents the brutalized ideological world in which the ‘EU’ took root, i.e. pre and post world war II mainland ‘Europe’ It conjures up for me a form of communism, overarching bureaucracy and general meddling.

    solidarité, solidarity, cohesion, harmony, togetherness, union, unity.

    Definition: An identity or coincidence of interests, purposes, or sympathies among the members of a group.

    http://thesaurus.reference.com/browse/solidarity

    Fortunately, there is no shortage of choice in the English language to express this concept, all equally if not more eloquent imho.

    The line between self interest and union is difficult to draw. The current financial crisis is exposing the EU as the (expensive) elephant in the room unable to respond coherently and rapidly to unfolding events. Given this backdrop, it is in my view therefore normal (another interesting word) that national interest prevails.

    Sincerely.

  3. Comments received need revision in light of events since Sunday in Paris.

    Excellent EU coordination. Must recognise that, pending new legislation, Member States strong national role still necessary.

    We can expect new approproach to regulation.

  4. Good day to you Mr Crossick

    Excellent EU coordination. Must recognise that, pending new legislation, Member States strong national role still necessary.

    If we take into account that the current financial mess is to a great extent due to Directive 2006/49/EC – the “Capital Adequacy Directive”, which introduced the mark to market accounting rules decided at the Basel II agreement, and moreover that experts in the field have been warning of its potentially devasting flaws since its introduction, is this belated ‘response’, which you term ‘Excellent EU coordination’, not merely the EU covering up for its own hugely expensive cock up (paid for of course by the taxpayer)?

    What strong national role of the Member States remains?

    Taking the case of the UK. In the past (the good old days when the UK was still the UK and not an EU province), the Governor of the BoE would simply have raised an eyebrow and put an end to any financial shenanigans and done the needs be to stabilise the situation of the bank concerned. A system that worked very well for over 200 years and propelled London to one of the leading and most respected financial centres of the world. Not one British bank failed during that period. Now his hands are tied by EU regulations and we see the partial nationalisation of several private banks. Other ex EU provinces would have done the same or something similar according to their banking culture. Instead we have banks going under all over the place.

    Are you suggesting that we should be thanking Brussels for this almighty balls up?

  5. James: believe that that there has been excellent EU coordination to overt a potential financial meltdown. I have not commented on previous financial legislation and regulation, but EU leaders are of the opinion that this must be revisited and developed. I’m no expert but have certainly heard considerable criticism of its existing quality

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