EU’s democratic deficit

Euro crisis widens gap between EU institutions and member states

By John R. Bolton, The Washington Times

The crisis of the euro, the common currency of 17 European Union members, continues unabated. Because of massive, sustained budget deficits by several eurozone countries, some could default on their sovereign debt obligations, or the euro itself might disintegrate, profoundly affecting the EU’s political and economic future.

Very little media attention, however, is focused on a very different, but even more important, EU problem, namely its “democratic deficit.” This large, growing gap between remote EU institutions in Brussels and citizens of its member states dramatically highlights the rising frustration and impotence felt by individual voters. To combat the euro crisis, EU elites are ignoring or overriding popular opposition to harsh austerity measures and imposing on fellow democracies the policies demanded by leaders of other, more powerful EU countries.

Even if the EU-wide remedies and the requirements imposed on countries such as Greece and Italy ultimately prove to be correct financially, they come with an enormous, corrosive cost to basic concepts of representative government throughout the EU. Whether this widening of the democratic deficit ultimately will weaken the EU itself remains uncertain, but there is no doubt populist resentment is smoldering in many EU countries.

One of the most persistent criticisms of the EU is its lack of democratic legitimacy. Its basic institutions are bureaucratic and opaque, with decisions either made by unelected European Commission bureaucrats or negotiated by EU member governments. These outcomes typically are binding on EU members, with no opportunity for independent judgment or meaningful dissent in national legislatures. The only popularly elected EU body, the European Parliament, has minimal power and is widely regarded as inconsequential.

Whereas national parliaments are elected directly by actual people, the intergovernmental EU process is not democratically accountable either to the EU’s population as a whole or at the national level. Thus, the growing shift of decision-making power to Brussels inevitably means further distancing from ordinary citizens and the declining importance of national legislatures. British Prime Minister David Cameron has estimated that 50 percent of Parliament’s significant economic actions simply rubber-stamp what EU negotiators or bureaucrats already have decided.

In 1776, Americans decided they had had enough of remote, unaccountable government and took matters into their own hands. While Europe does not yet face armed uprisings, it confronts the dramatic question of whether the EU and the eurozone will survive in their present forms. No one knows the endgame, but one point is clear: Having some countries dictate outcomes to others is causing massive tension inside the EU and adding to its democratic deficit.

In Greece, for example, former Prime Minister George Papandreou, after agreeing to harsh financial austerity measures to secure EU aid to meet his country’s sovereign debt obligations, suggested a national referendum on the final deal. Howls of outrage from German Chancellor Angela Merkel and French Prime Minister Nicolas Sarkozy squashed the foolish idea that the people might actually have a voice. EU leaders even insisted that the main opposition party, New Democracy (a quaint name in present circumstances), also sign the deal, rather than vote freely in Greece’s parliament.

In Italy, there was a veritable EU-led coup d’etat against Prime Minister Silvio Berlusconi. While many had long seen his personal behavior as an embarrassment, and his successive governments had done little to halt Italy’s slide into crisis, he and his coalition partners had, inconveniently, won the last election. Because Mr. Berlusconi and the voters who supported him were in the way, Italian President Giorgio Napolitano, following German-French orders, appointed Mario Monti “senator for life” to become prime minister when Mr. Berlusconi resigned. Even if Mr. Berlusconi was likely to fall in any case, Mr. Monti’s “technocratic government” would never have come to power without outside interference in Italy’s political system.

In Britain, the eurozone’s turmoil persuaded opponents of the increasing centralization of power in Brussels to push for restructuring London’s EU ties. Some propose a referendum on Britain’s future in the EU; others favor renegotiating the basic EU treaties, returning key “competencies” to members (or at least to London) or providing more opt-outs for EU members to decide what powers they cede to Brussels and what they keep. Other skeptical EU members, such as Denmark, Sweden and several Eastern and Central European states, might join the United Kingdom in this effort. Once again, Germany is objecting, demanding that the euro crisis should be resolved without considering fundamental changes to existing EU agreements, institutions and practices. This controversy remains in flux.

EU advocates for harsh austerity measures say they are entitled to impose stringent economic and political conditions on the financial assistance being extended in order to prevent the fiscally irresponsible countries from simply continuing their profligate policies far into the future. There is considerable merit in arguing that German taxpayers and others providing bailouts deserve assurances they will not be endless sources of financial largesse.

But in a more profound sense, the extraordinary depth of the crisis underscores graphically how flawed are the essential structures of the EU itself, and particularly the entire euro project. If rescuing the euro requires dramatic constrictions of political dissent and democratic debate, there surely is something existentially wrong with the underlying precepts.

If democracy can be supplanted easily when “big issues” are at stake and actual voters are allowed to select governments only for unimportant questions, the vitality and longevity of democracy itself are at issue. Europe may survive its financial crisis without major disruptions to the euro or other EU institutions, but there is no doubt that the democratic deficit will have widened considerably in the process. That outcome cannot be conducive to either legitimacy or stability in Europe for decades to come.

John R. Bolton, a former U.S. ambassador to the United Nations, is a senior fellow at the American Enterprise Institute and author of “Surrender Is Not an Option: Defending America at the United Nations and Abroad” (Simon & Schuster, 2007).

November 28, 2011 | 7 Comments »

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  1. The Berlusconi case is most interesting. In a cocky way, Europeans always brushed aside matters of morality and principle, these being of no concern among the Euro-sophisticates.
    And now that the noose is beginniong to tighten, they develop a concern for such “trivialities.”

  2. In Italy, there was a veritable EU-led coup d’etat against Prime Minister Silvio Berlusconi. While many had long seen his personal behavior as an embarrassment,

    I thought Europeans don’t care about their leaders sexual exploits. They have always made fun of us for being puritanical.

  3. Will the Capitalists on Israpundit please tell me how this will all trickle down to me, and how the big bankers are good news for the poor? I forgot the arguments.

  4. In light of the machinations of the EU among its members, it is little wonder that the EU feels justified in paying Israelis to oppose their government’s policies. Such undermining of Israel has to be allowed because the member of the EU said so.

  5. All of the Technocrats installed without elections in Greece, Italy, Ireland are all tied to Goldnman Saks, The Federal Reserve and IMF and European Central Banks. The Fed has been sending out the back door free newly printed money to the tune of Trillions of dollars off the books to Financial and corporations in EU and America. The are desperately trying to hold the Ponzi scheme together. Nobody in these institutions want to take the inevitable financial hits, so they will bring everybody down with them.

    Zombie Banks predators are mostly responsible for not only the EU financial meltdown but Americas as well. Zombie banks are running amok. With net values of less than zero, these institutions continue to operate thanks to the help of national governments that prop them up, print more money, and allow them to avoid financial punishment. The vast sums invested in keeping these banks afloat has failed to save the United States, the EU, or Japan from their current economic rut, leaving them in just as poor financial shape as before the market crash, only now with reduced resources for the future. Zombie banks are dangerous and positioned to prevent economic recovery. Since 2008 recession, Leaders in the U.S. and Europe patched up the troubled spots, printed lots of money and avoided the underlying issues. Especially the banking system, which blew up to bring the world economy down a few years ago, is still fragile, too wounded to support a recovery and filled with even more risk. That’s why I call the banks zombies. They will make the next blowup more spectacular.

    French and German banks are more exposed to the troubled economies of the region than others. During the boom times — when Irish housing prices quadrupled, Greek civil servants were allowed to retire at the age 53 — French and German banks fueled the boom in those countries. Now that the bubble has burst, those same banks face huge losses. There’s too much debt in Greece, Ireland, Portugal, Italy and Spain. When the debt isn’t paid — and most of it can’t be — then lots of European banks will go bust. Americas banks didn’t lend to Greece, Ireland or Portugal that much but they have other exposures to them — worthless derivatives backing their debt, loan guarantees, etc. So U.S. banks could suffer substantial losses in case of a string of EU defaults. On top of that is the added concern that the U.S. economy is sliding back into recession. American zombie banks have managed to stay alive with temporary patches. They’re too weak to survive a second downturn.

    BofA has the largest portfolio of mortgages which are souring and faces the biggest lawsuits due to home loans packaged into tricky securities that blew up in 2008.

    Problem is the Greedy banksters don’t want to take the losses. Goldman is the biggest culprit.

    Watch the following clips to get the real picture which Bolton skirts and doesn’t even address.

    The Keiser Report 215

    Your Bank’s Crimes Crashed the Economy

    Europe’s Bondholder Bawl as Black Friday Americans Brawl

  6. Here’s the problem:

    40 And the fourth kingdom shall be strong as iron; forasmuch as iron breaketh in pieces and beateth down all things; and as iron that crusheth all these, shall it break in pieces and crush.
    41 And whereas thou sawest the feet and toes, part of potters’ clay, and part of iron, it shall be a divided kingdom; but there shall be in it of the firmness of the iron, forasmuch as thou sawest the iron mixed with miry clay.
    42 And as the toes of the feet were part of iron, and part of clay, so part of the kingdom shall be strong, and part thereof broken.
    43 And whereas thou sawest the iron mixed with miry clay, they shall mingle themselves by the seed of men; but they shall not cleave one to another, even as iron doth not mingle with clay.

    — Daniel 1 (JPS)

    The feet of the statue in Daniel were, of course, the successor states of the Roman Empire: to name a few, Britain, France, Germany, Italy, Spain, Portugal, the Netherlands… (the rest is a stretch). The Bible says they would make a good college try at unifying, and indeed their royal houses were all once intermarried; but they can’t really stick to one another because they are fundamentally different peoples.

    The United States of America has uniquely been able to hold together, because we share a common language, common religious heritage, common historical institutions, etc. Even at that, we nearly fell apart in the 1860s because of minor historical, dialectical and socioeconomic reasons.

    The divides in Europe are deeper and more ancient. In order for the Greeks and Germans, for instance, to work efficiently with each other, Greek workers would have to migrate to Germany to find work and send their remittances home. They would, of course, be in competition with the Turks there for work, another issue Europe needs to address. The Greek economy itself would have to “Europeanize”. Men and women in dignified professions in Greece, where they might be the best in their country or community, would find themselves in competition with foreigners, and eventually forced out of business to pursue more menial work. Greece would become a sweatshop of Europe, and the Greek people would be cut off from their traditional customs. The expatriate Greeks in Germany, meanwhile, would be an underclass minority — Europe’s “hillbillies”.

    Before unification, Greece had the same problems it has now: popular unrest, strikes, hyperinflation, even default; but they were Greeks, with a strong sense of shared identity and a proud history. Many Greeks, I am sure, prefer to live this way, even if it means being something of a “backwater”. They are not numbers on a ledger; they are a people. I believe many Jews feel the same way, as do many Americans. Sooner rather than later, the great god Mammon is going to fall on its face. “Progress” and “Profit” are not the benchmarks of peace and happiness. As the Apostle Paul once wrote to Timothy,

    “…Godliness with contentment is great gain.”

    The clay (Greece) will separate from the iron (Germany), and the statue will come tumbling down. That’s what Daniel said, and what we seem to be seeing.