There is hunger in Europe. For the first time since World War II, this hunger and extreme poverty is not limited to pockets of exclusion in Eastern nations but running across the continent. Greece, Italy, Spain are in international media almost daily with depictions of hardships, soaring unemployment and deprivation. The European summer saw the birth of “the indignant ones”, a wave of protests sweeping these nations and to an extent, replicated across France. These “indignant ones” clashed violently with police at the peak of the Greek anti austerity protests, expressing a collective discontent that went, for the most part, ignored. Now, two months after these clashes, the European Union is still not responding with the haste that would be expected to aid its own citizens. A European Union that was once portrayed as “strength in unity” is now more fragmented and disunited than ever since its creation.
Meanwhile, German Chancellor Angela Merkel and French President Nicolas Sarkozy hold meetings where they decide the fate of millions across the continent:
Merkel and Sarkozy plan to propose the creation of a new European treaty, to go into effect by the end of March. The leaders said they would present their plans to EU President Herman Van Rompuy on Wednesday, ahead of a critical summit of all 27 EU leaders in Brussels on Thursday and Friday.[…]
The new treaty would include automatic sanctions for member states that violate the rules meant to keep deficits in check. “We want immediate sanctions in the event of non-respect for the rule keeping deficits below 3 percent” of gross domestic product, said Sarkozy.
He added that they would prefer a treaty agreed by all 27 members of the European Union, but said they would also accept a treaty signed by just the 17 countries that use the common currency.
This new treaty is portrayed as a necessity and not a choice. Member States are expected to sign it, follow this new rule of law, apply whichever measures are necessary and revise any cultural practices that would work against full compliance with the dictates of Germany and France. The common citizen, struggling to cover their bare necessities will have no say in this matter. In anticipation of potential turmoil and reluctance, credit agency Standard & Poors has put almost all the eurozone including Germany and France on “credit watch”. The agency announced that it had placed its “long-term sovereign ratings” of 15 eurozone nations on credit watch “with negative implications”.
“Sovereignty” is an odd choice of words in this context, especially considering the implications and alarmist tone of the “negative implications” for those nations that would refuse to sign this new treaty. Sovereignty is also an odd word when we scratch below the surface of this financial, cultural and corporate entanglement.
Standard & Poor’s (also sometimes referred to as simply S&P) is a United States-based financial services company. Their core business is the publishing of financial research and analysis on stocks and bonds. One of their main “products” is the publication of the S&P GSCI, a benchmark for investment in the commodity markets and a measure of commodity performance over time. This currently used acronym obscures the origin of its name, as it was originally known as “The Goldman Sachs Commodity Index” (hence the GSCI). In 2007, Goldman Sachs transferred ownership of this index to Standard & Poors, however, the name still bears their signature. Interesting fact, considering that both Italy and Greece are currently ruled by two Goldman Sachs executives.
The ascension of Mario Monti to the Italian prime ministership is remarkable for more reasons than it is possible to count. By replacing the scandal-surfing Silvio Berlusconi, Italy has dislodged the undislodgeable. By imposing rule by unelected technocrats, it has suspended the normal rules of democracy, and maybe democracy itself. And by putting a senior adviser at Goldman Sachs in charge of a Western nation, it has taken to new heights the political power of an investment bank that you might have thought was prohibitively politically toxic.[…]
The bank’s traders created a number of financial deals that allowed Greece to raise money to cut its budget deficit immediately, in return for repayments over time. In one deal, Goldman channelled $1bn of funding to the Greek government in 2002 in a transaction called a cross-currency swap. On the other side of the deal, working in the National Bank of Greece, was Petros Christodoulou, who had begun his career at Goldman, and who has been promoted now to head the office managing government Greek debt. Lucas Papademos, now installed as Prime Minister in Greece’s unity government, was a technocrat running the Central Bank of Greece at the time.
It is perhaps time that the European Union abandons all pretension of democratic representation. Nobody elected these Heads of State and their corporate ties have been purposefully obscured. Merkel and Sarkozy, unwittingly or not, exercising further pressure for compliance in what amounts to a non democratic, corporate imposition that only benefits international capital interests. This undemocratic rule is best illustrated by the fact that when the former Prime Minister of Greece, George Papandreou announced that he would call a referendum on the EU bailout plan, international pressure forced him to resign.
Currently, two unelected European Prime Ministers, in Italy and Greece, two of the countries with the most dire financial, social and political troubles have close ties with Goldman Sachs, a financial institution that deals in investment banking, securities and financial services for institutional clients. The very same firm that had past dealings with the corporation that is now threatening to lower European States credit ratings unless they comply with the demands of new adjustment measures and a new treaty that seeks to further curtail individual sovereignty. Also, as The Independent points out, Goldman Sachs was the firm behind the accounting practices that hid the extent of the Greek debt and financial failures. The citizens of this supposedly democratic State are held hostage to an international financial system of corporations that decide on the kind of future these citizens will have to live by.
Recently, philosopher Jurgen Habermas laid down his latest critique of the non democratic values of the current EU. He spoke of a lack of political union and of “embedded capitalism”–a term he used to describe a market economy controlled by unelected politics. This, it seems, has replaced the rule of democracy and citizen participation. It would be a shame if Greece, the country that prides itself as the birthplace of democracy would also become its final resting place. The people currently struggling with hunger, poverty and daily survival deserve better than that.