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Source link: http://archive.mises.org/16538/the-eu-crackup/

The EU Crackup

April 19, 2011 by

Political upheaval has hit Finland, and it’s merely a foreshadowing of bigger changes ahead. FULL ARTICLE by Llewellyn H. Rockwell Jr.

{ 24 comments }

dilbert April 19, 2011 at 7:42 am

Just a little correction.
the line:
“overtaxed Finns have no interest in sending their tax dollars”
Should probably read:
“overtaxed Finns have no interest in sending their tax euros”

Also “two days travel away” depends on the means with which you travel. It takes much less than two days if you go by plane.

J. Murray April 19, 2011 at 7:55 am

Flying is not kosher in “green” Europe. It’s all about those publicly subsidized trains there.

Paul R. April 19, 2011 at 12:26 pm

We use trains to go to Russia, maybe. Nobody I know has ever used trains to get as far as Portugal. One guy used a scooter, though.

RN April 19, 2011 at 12:16 pm

Rockwell’s claims are not completely incorrect but as a Finn I can’t help noticing that he seems to be distorting and exaggerating some facts. Before correcting them, let me give a brief overview of the composition of the parliament (200 seats) before and after the elections:

1. National Coalition Party: before 50, after 44
2. Social Democrats: before 45, after 42
3. True Finns: before 5, after 39
4. Centre Party: before 51, after 35
5. Left Alliance: before 17, after 14
6. Greens: before 15, after 10
7. Swedish People’s Party: before 10, after 10
8. Christian Democrats: before 7, after 6

“The core issue is whether Finland ought to be paying for bailouts for other EU states. In reaction to establishment support for the bailout, voters ousted the probailout ruling party and gave an upset victory to the bailout-critical conservative party.”

Before elections, the National Coalition Party (the “conservative party”) had only one seat less in the parliament than the Centre Party (the “probailout ruling party”) and was part of the same coalition government. The CP lost so many seats that it is now the fourth largest party but the NCP lost only so little that it become the biggest party.

In addition, the NCP is actually the most outspoken defender of the bailouts among all parties, even more so than the CP. The leader of the NCP, Jyrki Katainen, is the present finance minister and the probable future prime minister. He has stressed that bailouts represent a wise policy that all responsible statesmen should adopt.

“Against every expectation, the eternal rule of the social democrats is at an end.”

The Social Democrats got more votes than the gallups predicted for them and they are quite probably making a comeback to the government after a decade in the opposition. It’s possible and almost inevitable that the future government coalition will include both pro- and anti-bailout parties.

“But most striking of all are the gains made by a previously invisible party called True Finns. This is the only party to take a hardcore position: no bailouts at all. It also so happens that this party is predictably nationalist on issues of trade and immigration. But that’s not the source of the appeal. The bailout is what is on everyone’s mind.”

Well, you shouldn’t understress the importance of their anti-immigration stance in the minds of many of their supporters despite the fact that the party leadership is continually trying to make it appear a minor issue in their platform. The second popular candidate in the capital city area was, after all, a True Finn whose views are widely regarded (correctly or incorrectly) as having racist tendencies.

mwf April 19, 2011 at 1:12 pm

Also worthwhile to note, that basically all the parties in parliament are social democrat. The differences between the four largest parties are quite minute: It’s more about image than actual policy. The True Finns are anti-EU and immigration, but their economic agenda is perhaps more social democrat than any of the others. All are for “taxing the rich”.

coturnix19 April 20, 2011 at 1:50 am

So, they are nationalists, and they are socialists? Hmmm…. that ain’t good, is it?

Sione April 20, 2011 at 11:58 pm

National Socialst! Now that has a certain ring to it.

Sione

Kaj Grüssner April 21, 2011 at 12:15 am

Can anyone deny that both Republicans and Democrats are national socialists? In fact, can anyone name any major party in any country that isn’t?

Patrick Barron April 19, 2011 at 12:56 pm

The True Finns are just the advance troops. There are True Germans, True French, and True (Fill in the blank) in every country. No country dares hold a real referendum on the EU, because it would have no chance of passing.

prettyskin April 19, 2011 at 2:09 pm

So, in 1994, Finland voted/joined the European Union (EU). In doing so, they received assistance and benefits as a member. Of course, members do contribute to the union –so Finland contributed.Now, a member of that said Union needs help, regardless of the reasons, it seems obligatory for Finland to reciprocate.After the collapse of the Soviet Union, their trade partner, Finland was greatly depressed with very high unemployment. They saw it necessary to join the EU to reap the benefits then and now they are seeing it necessary to abandon a contractual agreement. Bite the hand that fed you, I better get to the Sauna.

Paul R. April 19, 2011 at 6:19 pm

Finland didn’t need a bailout in 1995 and has been a net loser in the EU/ECB wealth transfers. To imply that Finland is somehow obligated to participate in the bailout is outrageous.

prettyskin April 20, 2011 at 11:06 am

What is prevalent among some native born is to pretend their nation was financially strong. Deniers.

Kaj Grüssner April 19, 2011 at 4:06 pm

Prettyskin

What all proponents of “helping” Portugal and others seem to miss is that there is nothing the EU can do to actually help anyone. All they can do is to kick the can down the road, and in doing so they compound the problem even further. Just like in the US.

I don’t think Soini and the True Finns understand the economics of it all, but they do understand it is lunacy for an already debt ridden country like Finland with record high deficits of its own to guarantee the loans of a country that clearly is not able to repay its existing loans, much less the added 100 something billion in new loans.

The market has declared Portugal to be unable to pay its debt. It is sheer madness for a struggling country to assume the liability of another country that has already fallen. Soini understands this, which really shouldn’t be too difficult to grasp for anyone with half a brain. The fact that our finance minister and soon to be PM doesn’t is tragic, pathetic and wholly embarrassing.

prettyskin April 20, 2011 at 11:10 am

Okay, got you. Joining the EU should have been known to carry consequences. Finland did not understand (then and now) the economics of becoming an EU State.

Kaj Grüssner April 20, 2011 at 11:38 am

It seems clear you didn’t get anything, which is typical for people who are content with spouting the propganda they’ve heard in politically correct media.

In 1994, when Finland decided to join the EU, it was impossible to anticipate the current problems since the Euro would not become currency in Finland for another eight years. But even if they had known, it still doesn’t change the following fundamental facts of life:

1. There is nothing the EU can do to prevent the market correction from taking place. They’ve kicked the can down the road as far as it goes. When Spain and Italy falls all the bailouts and stabilizaion packages afforded to Greece and Ireland will be naught, and EU as a whole will have to deal with a much larger problem.

2. Even if Finland wanted to help Portugal, it doesn’t have the money to do so.

3. Helping Portugal the way the EU wants to do is not helping them at all. Its enabling them and other irresponsible countries to keep acting irresponsably.

Do you get that?

Another swede April 20, 2011 at 12:01 pm

Prettyskin, let me also point out, that it is quite reasonable to change your opinion once you have better data. I don’t know how it works where you live, but where I live, people have the right to change their opinions.

Ergo, once Finland thought it was a good idea, fine. Now they don’t so they should vote about it in true democratic fashion.

Sadly the “true democratic fashion” concept, is one that is wearing pretty thin in the EU. Very few people were allowed to vote for or against the constitution because politicians were afraid of a no. This shows the Eu is for politicians only (who btw get set for life with millions of euros) instead of for the citizens.

RichF April 19, 2011 at 9:16 pm

OK, I don’t know a whole lot about Finland, so why is there a Swedish People’s Party? Would that be like having a Mexican People’s Party here in the US? I know how well that would go over here…

Beefcake the Mighty April 19, 2011 at 10:11 pm

Ask yourself whether you’d rather have a Swedish People’s Party or a Mexican People’s Party.

RichF April 20, 2011 at 6:52 am

I’ll bet Mexican parties are way more fun!

Sione April 23, 2011 at 4:50 pm

RichF

Yes. I reckon you be right.

Got any tequila?

On a more serious note, why oh why is race such a big deal in the USA? I’d have thought it’d been done to death and that people were over it by now.

Sione

Another swede April 20, 2011 at 12:02 pm

Hello RichF. The reason is that finland used to belong to sweden once upon a time, and there still exists a small minority that only speak swedish. The swedish peoples party is the party for this minority.

mnuno April 22, 2011 at 2:23 pm

portugal’s banking industry was not (and still isn’t) in the need for a bailout. Portugal’s crisis is markedly different from that of Greece and Ireland (and Spain, Belgium…)
http://www.nytimes.com/2011/04/13/opinion/13fishman.html

Kaj Grüssner April 22, 2011 at 2:47 pm

Great! Another sociologist talking about economics. He is actually claiming that the bond markets and credit rating agencies brought down Portugal for ideological reasons! Yeah, ideology is the guiding star for all actors on the bond market. The fact that Portugal, like most other countries in the West, is patently unable to live within its means and repay its debts had nothing to do with it.

Notice how he claims that Portugal were doing a lot better than many of its neighbours. Like that’s saying anything, considering most of them are on the brink of bankruptcy. He doesn’t mention any figures either.

What he does call for is, surprise surprise, more regulation, more central planning and more money printing. Why can’t these guys just shut the hell up and go back drinking coffee wearing Che t-shirts?

Oskar Lindman April 22, 2011 at 3:44 pm

There are alternatives to the bail-out package suggested and, for instance, the social-democratic party here in Finland would like the banks to share some risk via a debt restructuring -scheme. I don’t know if it would make anymore sense economically or politcally, but it might be better in some moral consideration. What can you do with the current fiat-credit -based world economy? Mr. Rockwell was hoping for a return to sound money and so do I.

The swedish-speaking minority is not just a minority. The True Finns would like to get rid of compulsory teaching of swedish in schools, this was one of their political aims and aided to win the election. The swedes have it good here. Swedish is not only a language taught in schools, it’s all about culture and civilizational values, too, I would like to point out.

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