Posts Tagged ‘referendum’

Cameron is the unlikely winner of the Greek referendum

July 6, 2015

There will be millions of words written about the Greek “No” to the conditions set by its international creditors and what it means. But what strikes me is that the only real winner is David Cameron.

For Greece and the EU it is a lose-lose situation. If the creditors soften their conditions, the Euro and the EU loses. If the creditors stand firm and Greece leaves the Euro, the sanctity of the Euro and membership of the Eurozone is gone forever. My view remains that the best for Greece and the EU is for a return to the drachma, an EU which shrinks its ambitions and a dissolution of the Euro.

If the creditors now soften their conditions and a Grexit from the Eurozone is avoided, it will demonstrate that the IMF, ECB and EU conditions will never be the final word again for any member country. Each will always have the option in any negotiation of calling a “referendum” to reject the terms. Any negotiation by a member country with the EU can use a referendum to finally reject an EU position. Any country can then reserve the right to put any EU Directive to a referendum and EU Directives will become merely guidelines to be accepted or rejected by member countries at will.

If, on the other hand, a Grexit does occur and the fatally flawed Euro experiment begins to come to an end, it will be emphatic evidence also that the entire concept of a new Holy European Empire is something only in the minds of a very few in Bonn and Paris and Brussels, but is not shared – at this time – by the general population (represented by the general Greek public). It is a concept either too far ahead of its time or possibly which will never be real. At any rate, for this time, it would demonstrate that it is fundamentally flawed.

And what strikes me is that this helps David Cameron both within the EU in his quest for renegotiation and even for treaty change. It even helps him domestically. He has had an issue of credibility in that he has called for an In/Out referendum where he will surely have to call for an “In” vote. His problem lies in being able to show that he has won enough during negotiations to justify an “In” recommendation. But now, with the Greek precedent, he can even demand the most drastic changes in Europe without being thrown out of any room. He is likely to get changes which were unthinkable yesterday. He can even go to a referendum ostensibly demanding an “Out” as a negotiating ploy, get an “Out” vote and then return to the negotiating table. He can call a second or even a third referendum (and if a bankrupt Greece can carry out a referendum within a week then surely the UK can manage something similar).

Referenda are now just a step in the EU negotiating process.

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A Grexit is the best option as the government hides behind a new referendum

June 28, 2015

It seems to me that modern democracies – and especially those with coalitions produced by proportional representation – produce “followers” rather than leaders. And when “followers” pretend to lead they end up taking the easy, CYA, path through referenda. The Scottish referendum and the upcoming UK referendum on EU membership are illustrations of where supposed “leaders” pass the buck onto a diffuse and unaccountable electorate. The “wrong” choice can always be justified as being “the will of the majority”. All across Europe, countries have “followers” in leadership positions, who inevitably fail to lead. I take vision and the ability to carry people towards that vision as being the hallmarks of leadership. Rather than vision, it is the next election which governs. “Leaders” merely follow the current whims of the crowd and don’t even make the attempt to “carry” the crowd an any difficult path.

But I think the current Greek government’s call for a referendum to vote on the lenders’ conditions for further loans to Greece, while carrying out negotiations with those lenders is an abject abdication of leadership. Suppose, as is most likely, the conditions are rejected. The government may well return to the negotiating table in the hope that this may have strengthened its hand. Though exactly how is difficult to see. It is really only an attempt to mobilise a “sympathy” factor. It is equivalent to sitting in front of the bank manager, without any collateral and without any plans to stop spending on unnecessary things while pointing at a crying child and begging for a sympathy loan.

If the government recommends a rejection and this is confirmed by the referendum,  it would be the start of a Grexit. The government may carry forward a “begging” from the lenders but it will only be postponing the inevitable. If the people accept the lenders’ terms, the government ought to resign but will not since they can always point to the referendum for their abandonment of their “principles”. But it will also make it impossible for anyone to negotiate with the Greek government, since no “decision” by them will carry any credibility without being backed up by a referendum.

I expect we will see a run on the banks on Monday – if the banks are open. I also expect that the government will scrape up the relatively modest €1.6 billion needed for the repayment due on Tuesday. Then the result of the referendum  on Sunday the 5th will be the card in the hole to continue negotiations.

But I hope a default takes place and that the Greeks reject the lenders’ conditions and a Grexit does occur. Then a debt restructuring can take place. Writing off debt without first going bankrupt is not healthy. In the long run it will be better for Greece to return to the drachma. It will also be better for both the EU and the Eurozone. Both need to shrink. In corporate terms I would say that EU Inc. has expanded too far, much too fast. Some divestment is desperately needed. It would be better for the EU to focus on the common market and free labour movement provisions and to allow political union to happen whenever, and only when, it is ripe – or maybe not to happen at all. Trying to force the political union is counter-productive. The European parliament can be dismantled completely without losing anything. The Brussels bureaucracy could, and should, be drastically trimmed to be an accounting agency and nothing else. The common currency is of little value with the disparity in economic disciplines across the Eurozone. Dealing with multiple currencies but where each currency is representative of its underlying economy is not as difficult as having the fundamental mis-match we now have between the “average” value of the Euro and the strength of each of the underlying economies.

Greece needs to get out of the Euro strait-jacket it is in while remaining within the European trade zone.

Swedish Foreign Minister warns of the “Balkanisation of Britain”

June 5, 2014

Carl Bildt was once Sweden’s Prime Minster and was the UN’s envoy to the Balkans and is now the Foreign Minister. Not uncontroversial since he has many business interests ranging from Russia to Africa but generally radiates confidence and competence with a not insignificant measure of arrogance.

For a Foreign Minister he can be quite undiplomatic at times (not that it is always wrong to be undiplomatic). He has now poked his nose into the Scottish referendum and warns of the Balkanisation of the UK if Scotland decides to vote for Independence. He has a point of course. It would only be a matter of time before Wales, Ulster, the Channel Islands –  but perhaps not the Falklands – would all choose to go their own separate  ways into insignificance:

The Scotsman: SWEDEN’S foreign minister has claimed that Scottish independence would lead to the ‘Balkanisation’ of Britain.

 Carl Bildt also warned that a Yes vote would have ‘far-reaching consequences’ for the rest of Europe, in comments that echoed those made by former UK Defence Secretary Lord Robertson, in which he claimed that Scottish independence would have ‘cataclysmic’ geopolitical consequences.

Mr Bildt told the Financial Times that there would be ‘unforeseen chain reactions’ in Europe and the United Kingdom if Scotland voted for independence on September 18th.

The former UN special envoy to the Balkans between 1999 and 2001 said: “I think it’s going to have far more profound implications than people think. The Balkanisation of the British Isles is something we are not looking forward to.

“It opens up a lot, primarily in Scotland but also in the UK. What are the implications for the Irish question? What happens in Ulster?”

Mr Bildt also hinted that a victory for the Yes campaign could lead to the UK having to renegotiate some of its own EU membership terms. 

“The vote is one thing,” he added. “But there will then be a fairly painful period of separation and how is that going to affect the EU relationship? I assume there will have to be renegotiation of votes.” ……….. 

………… He likened the UK to ‘an island adrift in the Atlantic’ if it left the EU.

And the Swedish politician commented that both the EU and independence referendums showed that the debate in Europe was in the process of moving away from the Eurozone crisis to a more political phase.

“The main challenges in the past five years have been economic ones,” he explained. “Looking ahead for the next five years, it is political challenges in the east fairly obviously and also in the west fairly obviously.”

Crimea: Hypocrisy when the US and the West attack a democratic referendum

March 17, 2014

Personally I do not believe in referenda as a sustainable democratic method. If all decisions were taken to referenda we would essentially have an anarchy. But the use of referenda – occasionally but often not with great circumspection – has become a common practice in so-called democratic countries whenever an administration finds itself at odds with the great unwashed electorate and at risk of losing an election.

The Crimea has no great tradition or history as a part of Ukraine. It was merely attached to Ukraine in 1954 for administrative and prestige purposes during Khrushchev’s time. I find the developments in the Crimea are now showing up the double standards that always apply in international “diplomacy” in a very clear and sharp light. It is always a case of “do as I say” and never of “do as I do”.

There is little doubt that the Crimean referendum yesterday reflects the wishes of the majority of the inhabitants of that autonomous territory. The Tartars and the Ukrainians living in the Crimea largely boycotted the vote. But it was a direct vote on a simple question. It is being criticised for being illegal and unconstitutional by Obama and the EU and the “West”. But it cannot be criticised for being undemocratic. The claim that it was unconstitutional is a little weird since the current administration in Kiev can hardly be called constitutional. At best one could say that neither the acting government in Kiev (which is not an elected government any more) nor the referendum are in line with the currently suspended Ukrainian constitution.

EU Ministers are rushing to condemn the referendum – but they are careful to quote issues of legality and constitutional impropriety. They are careful not to call the referendum undemocratic. Hague and Cameron particularly show up as being triple-tongued and double-faced. The Crimea – under the Ukrainian constitution – had more autonomy than Scotland has in the UK. How then is a referendum in Scotland on independence acceptable but a referendum in the Crimea is not?  Hague claims that the referendum makes a “mockery of democracy” but that is an intellectually bankrupt statement. He might as well call for all of the UK to vote in Scotland’s referendum for that referendum not also to be a mockery of Democracy. David Cameron is struggling to balance between offering a referendum on EU membership and yet making it a vote which has no possibility of the UK leaving the EU. Democracy will not apply if the vote is “No” to membership. The electorate wants a referendum, so he offers them one. But the UK Parliament – which has surrendered many of its powers to Europe – is loth to allow the unwashed electorate any such power.

The reality today is that almost all “democratic” countries use voting systems which are nowhere near as direct or as represntative of an electorate’s wishes as a refrendum. The US Presidential elections with its electoral college is a case in point. Party democracies in Europe are extremely indirect reflections of the wishes of the electorate. It is political parties which control the names on the party lists. The broad electorate only chooses a Party, and the Party hierarchy and membership usually choose the representatives. The manner in which names enter the Party lists is hardly democratic. European countries which practice proportional representation have a quite “undemocratic” representation in their Parliaments. Extreme minorities have a disproportionately large presence in Parliaments.

There is a lot of noise and bluster from Obama and Kerry and all the EU politicians. But it is the imprudent wooing of Ukraine by the EU and US meddling which has created the current crisis in Ukraine. It is their indiscriminate support of any opposition (just as in Syria) which has allowed the advance of the violent far-right neo Nazis.

I also note that while Obama’s popularity is at an all-time low of 41%, Vladimir Putin’s popularity is at an all-time high of over 70%. And democracy, after all, is just a popularity contest. But the simple fact is that most of the Crimea would prefer to be with Russia than with Ukraine. Obama and his friends may call it illegal and unconstitutional but the Crimean vote yesterday was totally democratic.

Greens fail in Berlin referendum

November 4, 2013

In Germany the greens believe that it is worthwhile to pay exorbitant prices for electricity if it is from renewable sources. That “feel-good” view does not quite pass muster in not so good times. It is beginning to sink in through the German electorate that the shift away from nuclear and coal is not only very expensive, it also achieves nothing.  A referendum called in Berlin to satisfy the Greens’ needs to reduce coal utilisation has failed to garner enough votes to go forward.

BBCA bid to renationalise the electricity grid in the German capital Berlin has narrowly failed in a referendum. 

The measure was backed by 24% of those eligible to vote, but a quorum of 25% was needed for it to pass. It had been supported by green groups, who believe the current provider relies too much on coal. Opponents said it would burden Berlin with debt.

The wording had called for Berlin to set up a public enterprise to trade in electricity from green sources and sell it to residents. Voters were also asked to decide whether the city government should open the way for the grid to be taken back into public ownership.

There has been disappointment in Germany that privatisation of the energy grid has not always led to the hoped-for falls in prices and improvements in quality. The switch from nuclear to solar and wind power has also led to a steep rise in electricity costs.

But the authorities in Berlin – which is already 60bn euros (£50bn; $80bn) in debt – said the city could not afford to renationalise the grid.

Berlin has the dubious pleasure of paying the highest electricity prices in Europe (which may ensure a place for some residents in their imagined green heaven but may lead them to bankruptcy in this life). Berlin residents pay more than twice the price that Helsinki residents pay.

Forbes: 

Residential-Energy-Prices-by-City-EU-2013

The good people of Berlin pay more for electricity than residents of any other major city in the European Union, according to the Household Energy Price Index for Europe.

VaasaETT, an energy think tank based in Helsinki, Finland, tracks monthly prices of electricity and natural gas for utility customers in the capital cities of 23 European countries.

The price customers pay per kilowatt-hour (kWh) of electricity varies by as much as 127% across these 23 countries.

After adjusting for purchasing power, Berlin becomes the place with the most expensive electricity in Europe followed by Prague and Lisbon.

Meanwhile, Helsinki has the cheapest electricity followed by Stockholm. …

 


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