COMMENT

Who’s in charge of Europe?

By Nikos Xydakis

How much weight might a bank carry, as opposed to that of a country? It appears that on the scale of former European Central Bank President Jean-Claude Trichet, the interests of banks weighed more heavily than those of states and citizens.

It is with this kind of logic that Trichet acted with regard to the handling of the crisis in Greece and Ireland, a fact revealed through his blackmailing correspondence addressed to the countries’ governments during the 2010-11 period (published in Kathimerini on Friday and on March 9, 2014). The letters confirm what analysts and political leaders have maintained all along: Greece and Ireland were sacrificed so that major financial organizations with investment exposure to Greece’s sovereign debt and Irish lenders would not be affected.

This kind of intervention displayed by a central banker, a person who effectively does not come under political control and is beyond accountability ought to be scrutinized in multiple ways.

First of all, it shows a trans-European organization, the ECB, officially in charge of the eurozone’s common currency and bank operations, imposing extra-institutional fiscal policy and, by extension, decisively influencing the course of the Eurosystem’s member states.

Secondly, judging by the results, the ECB’s moves, which either showed signs of cowardice or came far too late, were unable to avert the crisis. Instead, they passed the cost onto the countries and pushed the eurozone into a spiral of downward recession as well as deflation.

A third aspect is the crucial transfer of power which is being observed within Europe as financial institutions are imposing their own will on European institutions and administrations.

The last observation was sadly reinforced by revelations made on Friday by the International Consortium of Investigative Journalists with regard to secret deals made between Luxembourg and 343 multinational companies in view of the latter reducing their tax bills back home.

In charge of the fiscal haven located in the heart of Europe is recently elected European Commission President Jean-Claude Juncker, otherwise committed to battling tax evasion and safeguarding healthy competition among the EU’s leading member states.

It looks like the European crisis, besides the financial aspect, is rapidly turning into a political and moral crisis as well.

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