STAFF NEWS & ANALYSIS
'The European Project' Takes Another Step
By Philippe Gastonne - August 10, 2015

History has shown that when a government wants to solidify its power, it has to turn its subjects into taxpayers. The Roman Empire demanded high tribute payments from every tribe it had newly conquered. And the United States developed from a commonwealth to a federal state when, in the 18th century, Treasury Secretary Alexander Hamilton achieved uniform duties and taxes for the entire union, initially on whisky, because it was so lucrative.

Politicians in the euro zone are now seeking to emulate the historic model from the early years of the United States. The unnerving bargaining over the latest Greece bailout program has led the leaders of the monetary union to conclude that the euro zone has to become more tightly joined together politically.

European Central Bank (ECB) President Mario Draghi wants stricter rules for the banking union. French President François Hollande is calling for a separate economic government for the monetary union. And in Brussels and Berlin alike, financial experts are devising plans to provide the Euro Group with the same tool that has proven to be so successful throughout history: its own tax. – Spiegel, July 30, 2015

"Never let a good crisis go to waste," a phrase attributed to various American political strategists, is advice politicians everywhere try to follow. Certain European leaders are following it right now. The Greek debt drama exposed serious divisions in the European political and monetary unions. Power-hungry Eurocrats see an opportunity to solidify their power.

Those behind the "European Project," as they like to call it, have never hidden their agenda. They want to build an ever-closer union of states that eventually makes the continent's current national borders meaningless. Knowing the proletariat would accept only smaller steps, they took what they could get.

The European Monetary Union (a subgroup of the larger European Union) had a serious design flaw from the beginning. The same euro currency would serve nations with radically different fiscal situations and agendas. Imbalances were inevitable.

EU Commission President Romano Prodi said back in 2001: "I am sure the euro will oblige us to introduce a new set of economic policy instruments. It is politically impossible to propose that now. But someday there will be a crisis and new instruments will be created."

It took 14 years but Romano's "someday" is finally here. His successors have a chance to do what was politically impossible in 2001. Their true target is a federation, a sort of "United States of Europe" with Brussels filling Washington DC's role.

With Greece, the EMU has proven itself unworkable because it lacks a single leader with its own funding source. The proposed solution is an EMU Finance Minister who can redistribute tax money between the member states.

For now, these will be "surtaxes" on current taxes. A flaw in that design will reveal itself eventually, and the Eurozone will give itself power to assess entirely new taxes. Then the taxes will expand outside the EMU to the larger EU. Then those states will reason that since they are paying for it anyway, they might as well dump their national currencies and join the Euro. Then the final step: since we're all using the same currencies, paying the same taxes, and following the same laws, why do we need these redundant governments in London, Paris, Madrid, etc.? Let's all join arms and confess One holy, secular and omnipotent Europe.

Today's European leaders see this as their manifest destiny. They firmly believe an incremental process will achieve the goal. So far, they are right. Any Europeans who wish to stop this process better get to work.

Posted in STAFF NEWS & ANALYSIS
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