John Dunn

First posted on Tuesday, 3 July 2012 at 20:52

I read an article in the New Europe paper last week, whilst in Brussels. How fascinating it is to see how others see the UK and its banking system.

Here are the pertinent paragraphs.

The world is running out of time. For Europe to survive,provided the world system does not collapse, it should take two immediate decisions; a fiscal union and a banking union. At the same time, a sane and safe Europe is cardinally important for the world system, as it is highly interdependent with Europe.

A Fiscal Union implies the adoption of the Eurobond concept as the German Chancellery has visualized it, a Redemption Guarantee Fund. The Banking Union requires the establishment of a European Banking Authority with supervising authorities, to oversee the 50 systemically important European financial institutions. A European Resolution Authority should be also established in the same context.

The British Veto

David Cameron will highly likely veto any such progress.Indeed, Britain cannot afford any of those provisions. Yet, this veto may be the golden opportunity for the European Union to marginalise Britain.

So far, Britain is producing practically nothing living from the tax-free commissions earned by the City on financial transactions. London is, and will remain, an offshore hedge fund.

As long as we continental Europeans allow this situation to continue, Europe will go deeper into the spiral of the economic crisis, now turning into political and social, the European Union will collapse in no time and Britain will continue to live parasitically, thanks to the City.

The Solution

At this Summit, the European Union has the chance to begin “cleaning” its house. The only actions it has to take is to disregard the veto of David Cameron and proceed multilaterally with the Fiscal and Banking Unions, moving from London to Frankfurt the European Banking Agency, replacing the British Director General of Internal Market (in charge of the euro!)with a Spaniard, and pass the External Action Service, now controlled by Britain, to an Italian.

This, I am afraid is our one and only chance. If we fail, we will then enjoy watching the most beautiful catastrophe ever! For full article, click here.

Posted by John Dunn.