Archive for januari, 2013

The economic mess and structural problems in EU and USA – Part 2

23 januari, 2013

This is the second part about USA. Again, It ain’t pretty to say the least!

Where the same absurd Alice in Wonderland economic and political farce is playing out in the USA. And as in Europe it is, as usual, the common people who are paying the price.

And as in Europe, the US crisis is anything but over regardless of what the political elites are trying to tell the people in USA. In USA the role of ECB is played by the FED (the Federal Reserve), which creates money out of “thin air” to support the gigantic and increasing debt. And to keep the stock market going and lower the price of the dollar.

So that the federal US government can spend your tax money like a drunken sailor.

(See my posts:                                      

The US election – Yes we have NO bananas

How Obama loves the poor SOOO MUCH, especially the black, that they have had the largest single drop in income ever

In three graphs – Obama Economics)

All graphs get bigger when you click on them

USA_jobs2

                                                 USA

In USA, Goldman Sachs and the other investment banks, plus the big Hedge Funds, are pushing leverage to ridiculous and dangerous extremes.

If you read the Comptroller of the Currency, Administrator of National Banks, report for the second quarter 2012 “Quarterly Report on Bank Trading and Derivatives Activities”, you get utterly horrified of the totals of the open derivatives positions in the US market.

Four of the largest U.S. banks are walking an extreme tightrope of risk, leverage and debt when it comes to derivatives.  Below you are going to find just how utterly exposed they are.

But first what is leverage?

Most people do not understand “leverage” and what it actually means. If they did, they would not sleep at night knowing what’s going on right now.

To put it simple: leverage means that these banks etc use a leverage of say 1:50 or 1:100 in their speculations. Which means that they only put up 1 of their own dollars for an investment worth 50 or 100 dollar. Their dollars are “worth” 50 or 100 times more than they actually are.

It ALSO means that IF “things” goes wrong way they LOSE 50 or 100 dollars for every dollar they invested in that trade or position. Or much, much more.

And usually when things goes wrong, it goes very fast when it comes to trading with these kind of leverages. So very quickly, these sums get astronomical. In a couple of days they can literally lose ALL their capital and more.

Nov deficit

 This has happened time and time again. Just to mention a few:

–         Lehman Brothers (was the 4th largest inv. bank in the US).

–          Bear Stearns

–          American International Group

–          Northern Rock (a medium-sized British bank)

–          Washington Mutual

–          American Savings and Loan

–          Landsbanki and Glitnir

–          Barings Bank

–          Société Générale

–          JP Morgan Chase & Co

–          Morgan Stanley

–          Long-Term Capital Management L.P. (LTCM)

As I said before, this is JUST A VERY SHORT LIST

Avalanche

This would not per se be a problem if this were a truly free and capitalist market. Because then these banks would go bankrupt and the owners and investors would lose their money. As they are supposed to do if the do bad business or trades.

But as we all know, this is NOT a free and capitalist market.  Our “dear” politicians have “decided” that these banks with all their wild speculations are too important or to big, to be allowed to fail.

 So instead, they have used taxpayer’s money and put whole countries at risk and in extreme debt just to bail out these banks.

And the banks knows that whatever speculations they do, REGARDLESS of how much or bad they speculate, and as you can see below their speculations are horrific, the politicians are going to bail them out with our tax money.

JP Morgan Chase

Total Assets: $1,812,837,000,000 (just over 1.8 trillion dollars)

Total Exposure To Derivatives: $69,238,349,000,000 (more than 69 trillion dollars)

 Citibank

Total Assets: $1,347,841,000,000 (a bit more than 1.3 trillion dollars)

Total Exposure To Derivatives: $52,150,970,000,000 (more than 52 trillion dollars)

Bank Of America

Total Assets: $1,445,093,000,000 (a bit more than 1.4 trillion dollars)

Total Exposure To Derivatives: $44,405,372,000,000 (more than 44 trillion dollars)

Goldman Sachs

Total Assets: $114,693,000,000 (a bit more than 114 billion dollars)

Total Exposure To Derivatives: $41,580,395,000,000 (more than 41 trillion dollars)

To sum up – TOTAL EXPOSURE TO DERIVATES for ONLY these four banks:

 207, 375, 086, 000, 000 TRILLION DOLLARS!!!!!!!!!!!

TOTAL ASSETS for these four banks:  4,720,464,000,000 TRILLION DOLLARS

So they can “cover” 2,27 % of the Total Exposure with ALL their Assets!

So who is going to pay for the “rest”:  202, 654, 622, 000, 000  TRILLION DOLLARS!!!!!!!!!!! if anything goes wrong?

EmployRecNov2012

Well, we know the answer to that doesn’t we. So far, it’s the common people, i.e. the taxpayers, who had to cover for all the banks bad speculations thanks to our dear politicians.

Take another look at those figures for Goldman Sachs.  If you do the math, Goldman Sachs has total exposure to derivatives contracts that is more than 364 times greater than their total assets!

That is utter insanity, but everyone just keeps pretending that the emperor actually has clothes on.

And why are “our” politicians SO EAGER to protect these speculators?

To put these GIGANTIC sums into perspective lets compare with the GDP from USA and all of EU from 2011

There a lot of different way to calculate GDP and the figures for each year. Add to that exchange fluctuations, conversion rates etc. So the figures below comes from the same source (IMF) to make the comparison easier.  And it is their conversion.

GDP USA 2011 – 15,094,025 billion US dollars

GDP EU 2011 –  17,610,826 billion US dollars

Total GDP for EU and USA 2011: 32,704,851 billion US dollars.

Lets compare these 32,704,851 billion US dollars with TOTAL EXPOSURE TO DERIVATES for  these four above mentioned banks:

207, 375, 086, 000, 000 TRILLION DOLLARS!!!!!!!!!!!

VS

32,704,851 billion US dollars in COMBINED GDP of EU and USA

Anyone see any problem???

Problem solved all right. So just move on, nothing to notice here or worry about.

Because according to out “dear” politicians, bankers and political elites from EU and USA there is NO SERIOUS PROBLEM HERE. The problems in USA and EU are more or less solved etc.

So the ones that put as in the mess in the first place, very “reassuringly” tells us: “We take care of it”.

Yeah sure!

mrzSpendaholic2

Let’s move on to another “bright spot” –the federal budget and debt. The figures are based on the 2012/2013 data:

2012 US Tax Revenue: $2,469,000,000,000

2012 Federal budget: $3,796,000,000,000

2012 Budget deficit: $1,327,000,000,000

US Federal Debt as of January 22, 2013: $16,471,084,067,491

Total interest paid on the debt in 2012: $359,796,008,919

Budget INCREASE between 2012 and 2013: $38,500,000,000

mrzWhat is the

To make these gigantic sums understandable here is how these figures would look like for a “normal” family:

Annual family income: $24,690

Annual family expenses: $37,960.  154% of the annual family income.

Annual family shortfall borrowed from friends/neighbors etc: $13,270.  54% of the annual family income.

Total interest the family paid last year: $3,598 (at near 0% interest).  Nearly 15% of the annual family income

Total family debt (mortgage, auto, credit card): $164,471.This is   666% of the annual family income.

Change in family spending this year: an increase of $385

This looks like a very responsible family wouldn’t you say?

And do you think this family would get any loans from the banks?

When you look at it this way, it really seems absurd. Yet it’s true… a slow motion train wreck. That any person with more than one functioning brain cell can see coming miles away.  Except our “dear” politicians. They are in ACTUAL FACT increasing the spending AND the debt.

Foodstamps%20Oct

Here’s another way to look at the debt ceiling I found in a paper. It’s very symptomatic:

Let’s say you come home from work and find there has been a sewer backup in your neighborhood… and your home has sewage all the way up to your ceilings.

What do you think you should do?

Raise the ceilings, or remove the crap?

Well, or “dear” politicians are franticly at an increasing speed trying to raise the ceiling at the same time as the “sewage” is increasing EVEN MORE.

Yeap, there you have politicians in a nutshell.

Why fix the problem that they themselves caused, when the politicians can pretend that they are the giver of all gods and bearer of all gifts to all the people all the time.

And it doesn’t cost anything for anybody. It’s ALL free forever. And they all lived happily ever after.

Sounds like a wonderful fairytale doesn’t it?

On that “cheerful” note, I stop here.

mrzOur children

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Annonser

The economic mess and structural problems in EU and US – Part 1

23 januari, 2013

EU, and the political elites behind it, is no longer a caricature or a joke. They have managed to become a joke of a caricature. An absurd Alice in Wonderland economic and political farce is playing out and the common people of Europe is, as usual, paying the price.

Here is just some updated data to some of my previous posts. It ain’t pretty to say the least!

(See my posts:

Citizens! Forgive us for not arresting those truly responsible for this crisis: bankers and politicians

This is why the Euro is doomed

EU a stupid empire on purpose

EU – an unaccountable mess created by an undemocratic treaty – Now also a crony Bankocracy)

The EU Crisis is anything but over regardless of what the political elites are trying to tell people in Europe. The ECB may have pushed the banking crisis temporarily back by promising unlimited bond buying. Yes, dear people, read that again – UNLIMITED!

That’s your tax money spent like a drunken sailor.

But soon there is NO MONEY LEFT.

So here we go again for the 7th, 8th or is it the 9th time so far – Europe’s banking system is breaking down again. No surprise to anybody expect or politicians and bankers.

Just start adding up the GIGANTIC NUMBERS and be utterly horrified!

This is the situation that politicians and the banks have put the common people of Europe in.

They are literally ruining us all. And WE, the common people, have to pay the price of their folly and speculations.

As a longtime observer of EU noticed:

Then again, on the insolvent continent, nothing really surprises us any more.”

And:

How can broke economies lend money to other broke economies who haven’t got any money because they can’t pay back the money the broke economy lent to the other broke economy and shouldn’t have lent them in the first place because the broke economy cant pay it back”.

Even a 5 year old can understand this. But not “our” politicians and bankers.

Remember that the Euro was always a political project. That’s why “they” haven’t done the”proper” economic policies. Because these policies would undermine the political purpose of the Euro. So they, the political elites of EU, are trapped. And that’s why the Euro was domed from the beginning.

And of course, none of this is covered in the mainstream/old media or by our “dear” politicians.

                                  Greece

Greek Bank Capital Needs at EU27.5 Billion, Bank of Greece Says

http://www.bloomberg.com/news/2012-12-27/greek-bank-capital-needs-at-eu27-5-billion-bank-of-greece-says.html

Greece’s four largest banks need to boost their capital by 27.5 billion euros ($36.3 billion) after taking losses from the country’s debt swap earlier this year, the largest sovereign restructuring in history.

National Bank of Greece SA, the country’s biggest lender, needs to raise 9.8 billion euros, according to an e-mailed report by the Athens-based Bank of Greece (TELL) today. Eurobank Ergasias SA (EUROB) needs 5.8 billion euros, Alpha Bank (ALPHA) needs 4.6 billion euros and Piraeus Bank SA (TPEIR) needs 7.3 billion euros, according to the report. Total recapitalization needs for the country’s banking sector amount to 40.5 billion euros, the report said.”

To put this in perspective: The entire capital base of the Greek banking system is only €22 billion.

By saying that Greek banks need €27.5 billion Greece is essentially admitting that is needs to recapitalize its entire banking system. Also, you should know that Greek banks are still sitting on €46.8 billion in bad loans.

So the Greek banks have a capital base of €22 billion and bad loans of €46.8 billion.

There is a name for this – Bankrupt!

And remember, this is AFTER ALL the “rescue plans”, bailouts etc. already implemented so far by the “Troika” (IMF, ECB and EC).

                                                  Cyprus      

Cyprus is the euro area’s third-smallest economy in GDP terms, accounting for less than 0.2% of the region’s output. Yet the country urgently needs external funding and applied for an Troika (EC/IMF/ECB) programme last summer. In the meantime, the amount in question has risen to EUR 17.5bn (100% of GDP).

Read that again – 100% of GDP!

By mid-2012, larger banks like Bank of Cyprus or Cyprus Popular Bank alone reported loans to Greek borrowers that exceeded Cyprus’ GDP.

The Cyprus central bank’s emergency liquidity assistance (ELA) to the banking system skyrocketed from EUR150m in March 2012 to EUR 9.9bn (55% of GDP) in September.

So the Cyprus central bank only in September but in 55% of the whole Cyprus GDP into its own banking sector.

20130119_cyprus2

                                                 Spain

Bankia worthless says new report

http://www.euronews.com/2012/12/27/bankia-worthless-says-new-report/

Bankia’s shareholders have received a nasty new year’s surprise. They may lose most of their investments or even all of them says the Spanish bank rescue fund in its latest report.

According to FROB, the Fund for Orderly Bank Restructuring, Bankia has a negative value of 4.2 billion euros, and its parent group BFA is 10.4 bn in the red.

Valuation is key in the recapitalisation of Spain’s banking system, weighed down by massive bad loans accumulated in a property bubble that burst in 2008. Bankia/BFA is set to receive 18 bn euros of European aid, and become the country’s biggest bailout recipient.”

A little known fact about the Spanish crisis is that when the Spanish Government merges troubled banks, it typically swaps out depositors’ savings for shares in the new bank.

So when the newly formed bank goes bust,  your savings are GONE. Not gone as in some Spanish version of the FDIC will eventually get you your money, but gone as in gone forever.

This is why Bankia’s collapse is so significant: in one move, former depositors at seven banks just lost virtually everything.

In addition, things are going from worse to worst, as bad loans in Spain continue to accelerate to massive new record highs.

20130118_SPAINLOAN_0

Index of Spanish Industrial Output

index of Spanish Industrial Output

                                                 Italy

In Jan 2012, Italy’s government believed Italy’s 2012 GDP would come in at – 0.4%. The actual in (Q3) – 2,4% (so far).  Only a miss by 600%.

20130118_ITALYGDP_0

And the forecast for Italy’s GDP in 2013 is being lowered every month. Each one as inaccurate as the previous one.

20130118_ITALYGDP1_0

And then there is Ireland, Portugal, France….

Part two tomorrow about USA.

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The active lying and deceit behind the creation of EU – The British story

5 januari, 2013

The all too familiar story how the political elite, in their own words and documents, decided to deceive and actively lie to the British people in an all out effort to join the “common market”.

Here is a piece by Christopher Booker and Richard North (see below) on the deceit and active lying behind Britain’s entry to the EU in their, the politicians, own words.

“The real problem the British people have had with the ‘European project’, as its insiders call it, is that they have never really begun to understand its real nature, and what was always intended to be its ultimate goal.

The chief reason for this is that our politicians have never properly explained it to us.

What makes this so much worse is that those who were most enthused by it, such as Heath, knew full well what ‘the project’ was really about — the plan to weld all Europe together under an unprecedented form of super-government.

They deliberately decided to conceal it from us, for fear that our anxieties about our loss of sovereignty might prevent them from being allowed to join.”

“Thus, stealthily assembled over decades, would this new ‘country called Europe’ finally take its place on the world stage. What we found most shocking in researching this story was that, when Britain’s leaders first considered joining the project, they were made fully aware of this hidden agenda.

As we see from Cabinet papers and other documents of the early Sixties, Prime Minister Harold Macmillan and his ‘Europe Minister’ Edward Heath were put completely in the picture about the secret ‘grand plan’. But in June 1961 the Cabinet formally agreed that it must not be revealed to the British people.

In Macmillan’s words, to admit ‘the political objectives’ of the Rome Treaty would raise ‘problems of public relations’ so ‘considerable’ that they should be kept under wraps. It was vital to emphasise only the economic advantages of British entry.”

“On the day we entered, he told the British people on television that any fears that ‘we shall in some way sacrifice independence and sovereignty’ were ‘completely unjustified’.

This was a deliberate lie, as no one knew better than him and the senior Foreign Office official who two years earlier had written a secret paper on ‘Sovereignty’.

The paper chillingly spelled out how it would be the end of the century before the British people woke up to how much of their power to govern themselves and make their own laws had been given away — by which time it would be too late.”

We seen this sad story repeated in country after country. The same behaviour with few exceptions.

This relentless drive at ALL COSTS from the political elites, on purpose, for a political union and European super state regardless of the will of the people.

And if the people protest and object, as they have EVERY time they where ALLOWED to, it doesn’t matter! Run them over, force it through one way or the other as the examples from the last 40 years clearly shows.

“At first it should be presented as just a trading arrangement, the ‘Common Market’ set up in 1957 by the Treaty of Rome. But the essence of that treaty was to create the core institutions of what Monnet always intended should one day be the ‘Government of Europe.

The idea was to work for ‘ever closer union’.

Treaty by treaty, it would take over more powers from national governments, based on the sacred principle that once power to make laws was handed over to Brussels it could never be given back.”

As I wrote in my post Citizens! Forgive us for not arresting those truly responsible for this crisis: bankers and politicians as the banderol of the police demonstration in Madrid so neatly summed it up:

”Citizens! Forgive us for not arresting those truly responsible for this crisis: bankers and politicians.”

The whole economic and political crisis in EU and USA summarized in one simple sentence.”

Citizens! Forgive us for not arresting those truly responsible for this crisis- bankers and politicians

And as I wrote in my post EU a stupid empire on purpose:

“This is one of the best and succinct descriptions of EU I have seen:

“The European Union is like a hospital where all the doctors are mad. It doesn’t matter what is wrong, the treatment is always the same – more integration – and it is always wrong. The best thing to do is never to enter it.

Once you are in, the best thing to do is to leave. If you can’t get out, you will probably die.”

I disagree with one thing this author says: “EU is the Stupid Empire”. EU is a POLITICAL project. The Euro is part of that political project.

A lot of  EU’s decisions make no economic sense whatsoever. In that regard, Peter Hitchens observation that “EU is the Stupid Empire” is completely right.  Not to mention the enormous cost to the common people of all these political motivated but economically disastrous decisions.

The economic side was always a way to “sell it to the people”. Step by step. So that the political agenda could be slowly, but steadily implemented. Until it was too late. The political elites new ALL along that had the EU project been presented to the people for what it really is, people in ALL countries would have rejected it.

BUT EU was on purpose designed this way. So that the people could not stop this political project.

Never forget that ALL the political elites, irrespective of party or ideology, in the EU countries were behind this. With very few exceptions.

One small example, before the referendum on the Euro in September 2003 in Sweden, ALL parties (with the exception of some communists, greens, socialists and some from the agrarian party, ALL big unions, ALL mainstream media, ALL the representatives of the business world etc was for the Euro. And they put massive financial and personal resources behind this.

But the Swedish people, wisely, rejected this with 56% to 42%.

In the latest opinion poll, December 2011, 87,6% of the Swedish people were against the Euro. 9,7 % for. (Update- one year later these figures are even worse).

They planned this, and wanted this. And they kept on purpose this real ideology behind the EU project well hidden from their citizens in their countries.

They kept everything on purpose, including treaties, SO technical and juridical that it was totally unreadable for the common people. Like the EU “constitution”.

Just to give one example of how meaningless the local parliaments have become:

In Sweden 65 to 85%, depending of which area, of “decisions” made by the Swedish parliament HAVE ALREADY BEEN DECIDED IN BRUSSELS.

I.E. The national Swedish parliament is in reality rubber-stamping Brussels decisions and implementing them.

That’s all!

And they cannot change even one syllable in these decisions. So much for “representing” the will of the people.

But of course, they are not telling us that. They pretend that ALL these decisions are made locally by the Swedish parliament as the “sovereign” representatives for the Swedish nation. When in reality they can, to the most part, only decide the colour of their on toilets.”

And sadly, and as usual, the mainstream media/old media has for the most part taken en active role in promoting this political union and the European Super State. Add to that, the press utter failure to inform the people of their respective countries how EU REALLY works. And what it means to people and the sovereignty of their countries.

Most journalists have no clue about the important “inner” bureaucratic game and ”the machinery” where nearly everything is decided. Instead, we see these useless reports and photo ops when the prime ministers or finance ministers meet. When in reality 99,8 or 9 % is already decided before they meet. Most of it is just a “show”. Often “very dramatic” late in to the night.

And this is nothing new.  We have seen so many different examples of this betrayal of journalist in their role as journalist. This is just sadly another.

Some other EU posts here:

Citizens! Forgive us for not arresting those truly responsible for this crisis: bankers and politicians

EU a stupid empire on purpose

EU – an unaccountable mess created by an undemocratic treaty – Now also a crony Bankocracy

The scam that is called EU and the Euro is behind the present crisis

Who the Hell do You Think You Are: The Euro Game Is Up!

EU – an unaccountable mess created by an undemocratic treaty

EU – The aim of this treaty is to be unreadable and unclear AND it can not be understood by ordinary citizens

The New EU foreign minister – An undemocratic appointment to an undemocratic post created by an undemocratic treaty

EU- an expensive pile of festering rubbish, mired in corruption, surrounded by inept and impotent politicians

EU: s foreign minster performance so far – lacklustre and a pushover 2

The HUGE difference between EU and USA in response to Haiti.

EU: s foreign minster performance so far – lacklustre and a pushover

EU – The inner game and the Corruption that Cost £684 931,5 per hour EVERY hour EVERY day EVERY year. And is increasing

The EU Auditors have, for the 15th year in a row, refused to sign off the EU’s accounts owing to Fraud and Mismanagement in the budget

                       EU Youth Unemployment Rates

20121206_EUYouth_0

(My bold and underlining)

Monumental deceit: How our politicians have lied and lied about the true purpose of the European behemoth

http://www.dailymail.co.uk/news/article-2255506/Monumental-deceit-How-politicians-lied-lied-true-purpose-European-behemoth.html

By Christopher Booker

Forty years ago today, in what was arguably the most fateful political move ever made by a British Prime Minister, Edward Heath took us into what was then called the ‘Common Market’.

Such a step had scarcely been mentioned at the previous General Election, and the British people had very little idea of what they were letting themselves in for, other than a trading arrangement that might make it easier for us to sell our goods to our Continental neighbours.

Four decades later, the picture could scarcely look more different. We have seen that supposedly cosy club we joined transformed, step by step, into a vast, bloated bureaucratic empire, imposing its suffocating rule over 27 nations.

We have also seen it plunged into the most destructive crisis in its history — one it has brought entirely on itself by its reckless dream of locking the countries of Europe together into the straitjacket of the euro.

During those 40 years the British have never been happy members of this club. Too often we have been out of step, and even bitterly at odds, with the rest — as in our refusal to join that single currency.

But today, as the EU’s inner core of countries drive towards ‘full political union’ in a desperate bid to save their doomed euro, the British now look at this swollen political monster with fearful bemusement.

Politicians of every party talk plaintively about the need for us to negotiate a ‘looser relationship’ with the EU, while opinion polls consistently show a growing majority wanting to leave it altogether — an option that even David Cameron no longer rules out.

Even on the Continent, influential voices are now recognising that something very significant is happening in Britain, as they suggest we should perhaps be allowed something never seen before — a mere ‘associate membership’ of the EU, allowing us to continue trading with it but without all its political superstructure.

How did we come to such a pass? Are we today looking at another historic crossroads, in its own way just as fateful as the one we faced back in 1973?

The real problem the British people have had with the ‘European project’, as its insiders call it, is that they have never really begun to understand its real nature, and what was always intended to be its ultimate goal.

The chief reason for this is that our politicians have never properly explained it to us.

What makes this so much worse is that those who were most enthused by it, such as Heath, knew full well what ‘the project’ was really about — the plan to weld all Europe together under an unprecedented form of super-government.

They deliberately decided to conceal it from us, for fear that our anxieties about our loss of sovereignty might prevent them from being allowed to join.

Ten years ago, with my co-author Richard North, I wrote a comprehensively researched history of the ‘European project’.

I had already been reporting for years on the incredible damage membership of the EU was doing to British life, through thousands of crazy directives and regulations, through the destruction of our proud fishing industry and the undermining of our agriculture, which was until 1973 the most efficient in Europe.

The real story, surprisingly, goes back to the 1920s, when a senior League of Nations official, Frenchman Jean Monnet, first began to dream of building a ‘United States of Europe’, very much on the lines that decades later would shape the European Union as it is today.

After World War II, Monnet, by then the second most powerful man in France, finally set the project on its way. He knew there was no chance of bringing such an astonishingly ambitious vision into being all at once. So his plan was that it should gradually be constructed, piece by stealthy piece, without ever declaring too openly what was intended to be its ultimate goal.

At first it should be presented as just a trading arrangement, the ‘Common Market’ set up in 1957 by the Treaty of Rome. But the essence of that treaty was to create the core institutions of what Monnet always intended should one day be the ‘Government of Europe.

The idea was to work for ‘ever closer union’.

Treaty by treaty, it would take over more powers from national governments, based on the sacred principle that once power to make laws was handed over to Brussels it could never be given back.

Ever more countries would be brought into the net, until the project reached its ultimate goal as a super-government, with its own president and parliament, its own currency and armed forces, its own flag and anthem — all the attributes of a fully-fledged nation state.

Thus, stealthily assembled over decades, would this new ‘country called Europe’ finally take its place on the world stage. What we found most shocking in researching this story was that, when Britain’s leaders first considered joining the project, they were made fully aware of this hidden agenda.

As we see from Cabinet papers and other documents of the early Sixties, Prime Minister Harold Macmillan and his ‘Europe Minister’ Edward Heath were put completely in the picture about the secret ‘grand plan’. But in June 1961 the Cabinet formally agreed that it must not be revealed to the British people.

In Macmillan’s words, to admit ‘the political objectives’ of the Rome Treaty would raise ‘problems of public relations’ so ‘considerable’ that they should be kept under wraps. It was vital to emphasise only the economic advantages of British entry.

Thus did Macmillan and Heath become drawn into complicity with that same web of deceit which was driving the ‘project’ itself (which is why we called our book The Great Deception).

Twice in the Sixties Britain made failed attempts to join the project — but within weeks of Heath entering Downing Street in 1970, he applied to Brussels a third time. Scarcely had negotiations begun than he learned that his future partners were already discussing the next steps along their path to full integration: a single currency, European defence forces, a common foreign policy.

Heath immediately sent word to Brussels pleading for all this to be kept quiet, because it might blow the gaffe with British voters.

For two years the negotiations continued, with Heath handing over all he was asked for, from giving away Britain’s fishing waters, the richest in the world, to become ‘a common European resource’, to the betrayal of our Commonwealth partners by excluding their goods from what had been for many their main export market.

Finally, Heath got what he was after: entry to the club — although he still pretended that the Common Market was little more than a trading arrangement.

On the day we entered, he told the British people on television that any fears that ‘we shall in some way sacrifice independence and sovereignty’ were ‘completely unjustified’.

This was a deliberate lie, as no one knew better than him and the senior Foreign Office official who two years earlier had written a secret paper on ‘Sovereignty’.

The paper chillingly spelled out how it would be the end of the century before the British people woke up to how much of their power to govern themselves and make their own laws had been given away — by which time it would be too late.

So began the dismal story which has been unfolding ever since. Already by the late Seventies, as the Common Market morphed into ‘the European Community’, we were becoming known in Brussels as ‘the awkward partner’.

Then came Mrs Thatcher’s five-year battle to win that rebate on our payments into the EU budget which, thanks to the ludicrously lop-sided conditions accepted by Heath, would have made us the largest single contributor by 1985.

In 1986 came the treaty called the Single European Act, which not only set up the Single Market but handed over to Brussels all sorts of other powers, including environmental laws which were to lead to everything from the shambles of our rubbish collections to building thousands of hated and useless wind turbines.

                                           EBC Balance sheet

EBC Balance sheet

In 1990, nothing did more to inspire hostility to Mrs Thatcher among her European colleagues, led by Jacques Delors, than her defiant opposition to the Maastricht Treaty, designed to create the European Union, introduce the ‘social chapter’ and, above all, to launch the single currency.

As soon as he replaced her, John Major proclaimed his wish for Britain to be ‘at the heart of Europe’ and signed the Maastricht Treaty (admittedly with those vital opt-outs for Britain on the single currency and the social chapter).

But seven years later he ended up more at odds with his partners than ever, as they imposed their worldwide ban on the export of all British beef products over ‘mad cow disease’, tried to sneak us into the social chapter under ‘health and safety’ rules and laid their plans for yet another integrationist treaty in Amsterdam.

Tony Blair, too, wanted to be ‘at the heart of Europe’, as the single currency approached (which he would love to have joined), signing us up to the social chapter with its damaging working-time rules, and two more treaties, at Amsterdam and Nice.

But he too found it hard to keep up with that relentless drive for ever closer union, as it led to seven years of tortuous negotiation to create ‘A Constitution for Europe’, eventually sabotaged by the voters of France and Holland, so that it had to be smuggled in by deceit as the Lisbon Treaty (which, among much else, incorporated the Court of Human Rights into the EU). Scarcely was the ink dry on Prime Minister Gordon Brown’s signature on that treaty than the EU was plunged into its worst-ever crisis over the euro, which today is spreading misery across southern Europe.

As always, the response of the EU’s leaders has been to call for yet ‘more Europe’, and a new treaty to force the eurozone members into ‘full political union’.

This is now leaving Britain more obviously marginalised than ever, condemned to remain in the outer ring of a club, many members of which would now be only too pleased to see the back of us.

This humiliating prospect has seen our politicians running around like bewildered sheep, bleating about the need for Britain to negotiate a ‘looser relationship’ with the EU, to get back to that trading arrangement we thought we were entering 40 years ago.

Astonishingly, this is now even being echoed as a possibility by those influential voices in Europe itself — even though the most fundamental rule of the club we joined back then was that, once powers are passed to Brussels, they can never be given back.

As David Cameron prepares to give that ‘very important speech on Europe’ he has promised us very soon, he could not do better than to meditate on the shrewdest words ever uttered by a Prime Minister about Britain and Europe. In 1973, as a junior member of Heath’s Cabinet, Margaret Thatcher made all the approved noises about how wonderful it was for Britain to join this club.

Once in office, however, she went on a painful learning curve, as she saw from the inside just what the real game was and how ruthlessly it was played. She was brought down in 1990 by an alliance of Europhiles in her party and their Brussels allies, because she was the last real obstacle to their Maastricht Treaty.

What really riled them was that she had seen through their true agenda and the disastrous course on which they were set.

With even Jacques Delors, the chief architect of Maastricht, suggesting it might be best for Britain to leave the EU, Mr Cameron should dwell on a passage from her last book, Statecraft.

That such an unnecessary and irrational project as building a European super-state was ever embarked on,’ wrote Lady Thatcher, ‘will seem in future years to be perhaps the greatest folly of the modern era. And that Britain...should ever have become part of it will appear a political error of the first magnitude.’

If Mr Cameron truly wishes to speak for the British people and our country’s future, he should bear those prophetic thoughts in mind.”

And Richard North complementing on the same subject:

EU politics: monumental deceit

http://www.eureferendum.com/blogview.aspx?blogno=83462

“The piece serves to remind us that entry was perpetrated on the basis of structured deceit, with successive prime ministers (Macmillan and Heath) actively lying as to their broad intentions and the proposed relationship with the Six.

“Those utter fools who assert that the relationship was primarily economic (and has since gone off the rails) need to read the Cabinet Memorandum of 21 June 962, (originally referenced C. (61) 84 and now CAB/129/105), in which Macmillan set out the purpose of seeking full United Kingdom membership of the European Economic Community, as ”… the only effective way of securing our political objectives in the world, and of averting the dangers of continued division in Europe”.

Eur%20000-cab1

Then, in a note to his Cabinet colleagues on 10 October 1961 (Originally C.(61)162, now: CAB/129/107 – see above), Edward Heath asserted that the UK had been following closely the progress towards unity in fields other than those covered by the three communities.

He conveyed to his colleagues that it was the intention of the UK to work with the Six ”in a positive spirit to reinforce the unity already achieved”. Heath was ”convinced” that the UK and the Six ”share the same essential interests”, and that ”the habit of working together, once formed, will mean, not a slowing down, but a continued advance and the development of closer unity”.

From the very start, therefore, it was evident that Heath intended to take the UK into the EEC with a view to developing further political unity. The economic issues were always camouflage, and the label ”Common Market” was simply a ploy deliberately to obscure the real intent.

Cameron and modern-day politicians are now paying the price for that deceit, having to deal with a relationship founded on a bed of lies and poisoned by the continuing deception.

Such a situation is irrecoverable, which means there can only be one resolution – our withdrawal from the European Union. Simply, a relationship built on lies can never prosper, and can never be repaired. We need to start again to avoid what Thatcher called a ”the greatest folly of the modern era”.

And the first step starts with the admission that the EU and its precursors were never economic alliances. The economic aspects were always a means to an end, designed to secure political unity, something which has been foisted upon us by deceit, and of which we want no part.

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