Eurobloat #0001 • May 2010
May 2010 was the month the eurozone stopped pretending the rules existed. In the space of a fortnight Brussels promised three quarters of a trillion euros it did not have, ordered a central bank that is forbidden from financing governments to start financing governments, and then announced that the real lesson was that member states could no longer be trusted to write their own budgets.
Folly of the Month: Brussels appoints itself headmaster of every national budget
On 12 May the Commission published its plan for a "European Semester", under which member states would submit their draft budgets to Brussels and Brussels would grade them before national parliaments had voted on a single line. The institution that had just spent a fortnight setting fire to its own deficit rules decided the problem was insufficient deference to its judgement, and that the cure was for it to mark the homework of twenty-seven elected governments in advance. The right of a parliament to decide how its own people are taxed and spent, the oldest power any assembly has, was quietly redrafted as a draft to be reviewed by officials. It was sold, naturally, as mere "coordination".
1. A 750 billion euro safety net stitched together over a weekend
On 9 May, after a marathon all-night session, finance ministers and the IMF conjured a 750 billion euro rescue fund, the embryo of what became the EFSF and then the permanent ESM. The treaties had promised, in writing, that no country would ever stand behind another's debts. That promise lasted until the first weekend it was tested.
2. The ECB starts buying the bonds it is forbidden to buy
On 10 May the European Central Bank launched its Securities Markets Programme and began hoovering up Greek, Irish and Portuguese government debt. The treaties forbid the bank from financing governments directly, so it bought on the secondary market instead and called this respecting its independence. Its own chief economist disagreed so strongly he later resigned.
3. 110 billion euros for Greece, plus homework
On 2 May the Commission, the ECB and the IMF unveiled a 110 billion euro loan for Greece in exchange for spending cuts, tax rises, pension cuts and privatisations. A decade of looking the other way while the numbers were fiddled was thus resolved by lending the patient more money and instructing it to cut. The auditors who had waved Greece into the euro were, as ever, nowhere to be found.
4. A ten-year Digital Agenda for the internet
On 19 May Commissioner Neelie Kroes launched a ten-year "Digital Agenda for Europe", a sweeping plan for how the Commission intends to manage your online life. Civil-liberties groups warned at once that its language on "lawful" content and cooperation with rights holders pointed towards filtering and three-strikes-style policing of what citizens may see. Nothing says innovation quite like a decade-long regulatory roadmap drafted by people who have never shipped a product.
5. Conditions set for handing your bank records to Washington
On 5 May the Parliament adopted a resolution laying down its terms for any new deal letting United States authorities trawl European bank transfers through the SWIFT network. Having rejected the previous version in February over the absence of judicial oversight and a workable definition of terrorism, MEPs restated the obvious. By August a fresh agreement was waved through anyway.
6. The Commission fines memory-chip makers 331 million euros
On 19 May the Commission fined ten producers of DRAM memory chips a combined 331 million euros for a price cartel, its very first "settlement" deal in which firms admit guilt for a discount. The conduct had ended in 2002. Brussels took the best part of a decade to reach a deal, then congratulated itself on inventing a faster procedure.
→ phys.org
7. Up to 6,000 euros a head for a common resettlement scheme
On 18 May the Parliament backed a joint EU resettlement programme offering member states up to 6,000 euros for every third-country refugee they agreed to take, alongside the new European Asylum Support Office. A continent that could not control who crossed its external borders decided the answer was a centralised bounty scheme and another agency to run it. The countries actually facing the inflows were, predictably, expected to fall into line.
8. MEPs forbid the gluing-together of meat
On 19 May the Parliament voted by 370 to 262 to veto the authorisation of thrombin, the enzyme that binds scraps of meat into a convincing single steak. The case against it was real enough, but the spectacle of a continental legislature solemnly debating meat adhesive while the currency burned was its own kind of comedy. Brussels can find time for the steak.
9. A 300 million euro bill to keep shutting a reactor it told Bulgaria to shut
On 20 May the Parliament backed a further 300 million euros to help decommission units 1 to 4 of Bulgaria's Kozloduy nuclear plant, reactors the country was made to close as a condition of joining the club. Having ordered the lights switched off, Brussels keeps writing cheques to pay for the switching off. The bill, as with so much else this month, is for everyone and the decision was for no one.
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