http://www.project-syndicate.org/blog/a-eu...ozone-s-problemThis is a link to a speech made by George Soros about the eurozone crisis. The first thing that interested me is his explicit discussion of what has changed in the character of the european project. Like many of us Mr Soros was a strong supporter of european integration for all of the social and internationalist aspirations many of us shared. Those were indeed a strong feature of european union and they still have resonance for many.
Over time I have changed my mind and am now opposed to the whole thing: and that is because I perceive it to have been captured by plutocrats who have the aim of dismantling the social and political elements in order to impose their crazy greed on all the world: and dismantle democracy while they do it. Europe has always had a democratic deficit which disturbed me: but it was something I thought could be altered over time. I no longer believe that because the direction of travel in all of the developed world is away from democracy, and in that context I see no prospect of europe bucking the trend. The fiscal rules imposed reinforce that view because they quite clearly put banks' and financial institutions' intersts at the heart of the system.
Mr Soros does not wholly concur but it is quite surprising how many of his conclusions are based on similar thinking. For example he identifies a change in the nature of the european union from a "voluntary association of equal states" to one of a creditor/debtor relationship. That is precisely what we see, and it is the essence of a move from democracy to plutocracy, because once again it reduces everything to mere money.
Mr Soros also identifies the lack of a sovereign currency as a fundamental problem and he is one of those who consider that the eurozone has the practical effect of turning poorer nations into third world countries which have to borrow in foreign currency, with all the lack of autonomy that entails. He is also aware that the IMF prescriptions were disastrous for those countries which were subjected to them in the early 80's and that those same prescriptions are being applied within europe today with, inevitably, the same result.
Where I part company with Mr Soros is that he locates the problem with the euro itself, and the solution with Germany. That is not to say that I do not agree with him insofar as there are clear structural problems with the euro: not do I disagree that if the focus is on improving the situation within europe then Germany must act in a different way. I have said before that if that is the problem then it is my view that Germany should leave the eurozone: Mr Soros says that is what ought to happen if his preferred solution is not acceptable to Germany, as is currently the case. His preferred solution is the issue of eurobonds, and on his analysis that would go a long way to restoring the euro to health and the union to a more equal partnership. Mr Soros says that Germany needs to make a choice between these two options and the longer it delays the worse things will become.
If governments are to continue to borrow from private markets, which Mr Soros not surprisingly takes for granted, then this is as far as anyone can go in sorting out the problems, arguably: and so I think his analysis is right to that extent. I remain unconvinced about borrowing as a necessary or desirable thing, at least in the way it is done now. For his solution does put a lot of focus on preserving the banks and the markets as a primary aim and I am not convinced that solves the problem of underlying plutocracy.
But I accept mine is a minority view, and within those contraints this is an interesting proposition and would certainly help, I think
