Tuesday, June 26, 2012

Europe and the loss of national sovereignty

In reading about this subject, we have to wade through pools of crocodile tears.
What is the issue? The Netherlands may lose its unbounded right to overspend and build up deficits. Nice right!
It is simple: overspending delays and increases payback. So, if you are old, vote against ‘more Europe.’ If you are young, vote in favor of it.
I am in favor of individual freedom, that is, my personal freedom. I am quite willing to grant others their individual freedom - as long as they don’t impinge on mine. I don’t want people to have the freedom to steal my purse, to enter my house, to trample my garden, to take my books home. In the end, I have more freedom if the larger community restrains some freedoms.
My freedoms are even more restricted. I can’t do with my house what I want. I may grow as many trees in my garden as I want, but I can’t chop them down when I want. So many restrictions. Still, I live pretty free.

I don’t think national sovereignty is at stake by a 3% ceiling on overspending. The European Union consists of what Daniel Boorstin called ‘modern democratic societies where each people asserts its divine right to go to hell in its own particular way.’ (The Image, 1962, preface to the Pelican edition) The right to freely overspend is an aspect of that divine right.
What happens if we don’t accept such restrictions by Brussels? We will become dependent on the vagaries of the financial markets, where money slushes through the system in search of short-term advantages for small participants. That may not be evil, but it certainly is incredibly more volatile and threatening than any ceiling from Brussels.
I see quite an other problem. In the future, any political wish that a government doesn’t want to grant, can be blamed on Brussels. Like parents who can’t satisfy the wishes of their children, blaming it all the time on their bank who limits overspending. The point is, of course, that if you don’t overspend, the bank remains completely uninvolved with how you spend your money.

Of course, there are several other aspects of the trend to further federalization within Europe, like common banking laws and common bonds. We should not fear the loss of national freedoms, but the loss of individual freedoms and individual prosperity.
We also should maintain a free market as far as possible. But people and companies that have benefited from the free market attain positions in which the freedom of their enterprise is used to curtail that of others as much as possible. Free enterprise means freedom for new enterprises, not for established ones. You need a strong state to keep the markets free. An indebted state is not a strong state.
So, please, please, somewhat less national sovereignty please. Financial sovereignty doesn’t mean to lend as you please, but solvability and liquidity. The reigns should only be loosened in case of war, calamity or promising new infrastructures for energy and transport.

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