Politicians fiddle, Rome burns, people die, Jesus weeps
As Italian bonds rise past the 'unsustainable' 7 per cent barrier (the level which ended democracy in Ireland and Greece), the contagion is indeed about to spread to Spain and France, just as His Grace foresaw months and months ago. PIIGS was the acronym, though the chronology will be IGIPS. It’s not rocket science, is it? This economics lark is as simple as running a grocery shop, as Margaret Roberts once learned at the feet of her alderman father. If more cash is going out than is coming in, you will run out. If you borrow and can’t repay your debt, you are bust. Simples. Italy’s debt stands at €1.9 trillion. They will need €362 billion next year merely to service their debt. They haven’t got it. The ECB is now busily swallowing chunks of that debt (with no jam) and it is all down to Germany to save monetary and (so we are told) European union.
What is the point? The whole enterprise is the product of political hubris and vanity. EU politicians have spent months assuring us that the bailouts are working. We, of course, knew otherwise. The PIIGS governments will never be able to repay their debts at 7 per cent interest. But still the pathetic dance goes on, with the occasional absurd interjection from a scurvy politician twittering on about ‘market morality’, whatever that is.
Pope Benedict XVI observed a few years ago that the global financial crisis ‘shows the futility of money and ambition’. He said: ‘He who builds only on visible and tangible things like success, career and money builds the house of his life on sand. We are now seeing, in the collapse of major banks, that money vanishes, it is nothing.’ And he added: ‘The only solid reality is the Word of God’.
Amen to that.
As the Mammon trinity of the IMF, EU and ECB struggle to keep the euro on life support, it is time to face facts: the patient is dead. The more they now try to intervene, the higher the risk of weakening the currency and causing an increase in interest rates, with all the consequent unemployment, recession, inflation and increased poverty. This is a profoundly moral issue, for people are reduced to hardship and depression, firms are condemned to closure, more workers to unemployment and more families to homelessness through unprecedented levels of repossession. The total number of Irish suicides, Greek heart attacks, Italian divorces and Portuguese mental breakdowns will never be known. The élite pontificate and the people die. But you don’t hear much about the poor, the oppressed, and the underdogs.
God demands conscience above political conviction, and a government which places narrow economic considerations above life, liberty and justice is guilty of worshipping Mammon above God.
We have now come fact-to-face with what Pope Benedict referred to as the ‘Godless character of modern culture’, with the warning that ‘Nations once rich in faith and vocations are losing their own identity under the harmful and destructive influence of a certain modern culture. There are those that, having decided that “God is dead” declare themselves “god”, believing themselves to be the only creator of their own fate, the absolute owner of the world. When men proclaim themselves absolute owners of themselves and the only masters of creation, are they really going to be able to construct a society where freedom, justice and peace reign?
‘Is it not more likely — as demonstrated by news headlines every day — that the arbitrary rule of power, selfish interests, injustice and exploitation, and violence in all its forms, will extend their grip?’
A prescient pope knows more about human nature and the laws of economics than any politician or economist. The introduction of the euro artificially decreased the interest rates of many EU members countries, in particular those with a weak currency. The countries who benefited the most from this decrease were Greece, Ireland, Portugal, Spain, and Italy.
And which countries are now carrying insupportable debt and suffering intolerable deficits?
Just to fulfil the vacuous dream of being at ‘the heart of Europe’.
And, bizarrely, while Ireland, Greece and Italy now struggle to survive amidst public sector strikes, austerity measures including pay freezes, tax hikes and extensions to the official retirement age, soaring unemployment and civil unrest, Tony Blair still believes the UK should ultimately join the euro.
This is one political ‘never’ the people should shout from the rooftops. Blair talks of the need for a secure foundation – the rock of EU-wide economic governance. The single currency was built on sand: it was destined to founder without political union, which will now arise.
But remove from a nation the right to set its own interest rates to suit its own domestic economy, and in times of turmoil it is left either to tinker with taxation or slash spending. Since the people are not particularly disposed either to high rates of taxation or to cuts in their public services, disquiet turns into protests; protests become marches; marches become riots; riots become social turmoil.
And social turmoil slips into civil war, which is precisely what looms.
Never forget that the EU’s answer to the EU’s problems is invariably ‘more Europe’: every crisis is an opportunity for more regulation and centralisation. And the sovereign debt crisis that threatens to engulf European financial markets is no exception. The eurozone will be stabilised economically in accordance with Bundesbank discipline and bound politically by Teutonic politico-militarism. The German constitutional court would have it no other way. The outcome will be 10 nations intent upon political union. The currency will be the euromark. Just get on with it before more people die.