More Nails in EU Coffin?
By Staff News & Analysis - April 18, 2011

Massive gains for a massive man – the nationalist True Finns' shock election result in the 2011 Finnish general election befits the burly figure of their leader, Timo Soini. And there is much brain to go with the brawn, according to journalists who have followed his party's advance from the margins of politics – from just 4.1% of the vote in 2007 to about 19% four years later. Brain, wit and charisma applied to a Euro-sceptic and nationalistic agenda – a potent mix worrying EU strategists who are mindful that Finland, unlike other eurozone states, has reserved the option of vetoing financial bail-outs. – BBC

Dominant Social Theme: The EU shall overcome. The union is not to be trifled with.

Free-Market Analysis: There is yet a hammering sound surrounding the EU. Some say it comes from those who are busy building a box in which to contain the region's endless sovereign debt crisis. Others might be persuaded the box is the EU's coffin. The distinction is important not only to the EU but to the Anglo-American power elite that is running as hard as it can to refine plans for one-world government before the Internet and the rolling worldwide inflationary recession generates a critical mass of opposition to such plans.

Of course there IS no power elite with plans for a New World Order according to mainstream Western media. Never mind that in an interview with the website Infowars over the weekend one of America's pre-eminent television broadcasters went on record as saying that indeed there was. "Lou Dobbs: Elites Are Setting up a One World Order," read the Infowars headline. And Dobbs' perspective is shared at least in part by other prominent US officials, including Congressman Ron Paul (R-Tex) who may once again be a leading candidate for US president in upcoming Republican primaries.

Yes it's fairly obvious what is going on, given the massive global regulatory infrastructure that's being put in place. The Internet by now has shredded any pretense of that such plans are not being pursued and the result has been a change in elite tactics from what we can tell. The elites have decided to strike back by substituting intimidation for secrecy.

As we report in today's other article, such a strategy carries risk. By increasingly attempting to promote its policies through via brute political, economic and military force, the Anglo-American power elites make each individual battle into an entire war. Lose just one contest and the inevitability of global governance begins to drain away. This is why even the smallest battles such as who will be president of the Ivory Coast (see other article today) take on massive resonance and are reported in detail by the mainstream press for day and weeks.

It is a kind of dominant social theme itself: The new world order is a global juggernaut that will mow down all that stands before it; the instrumentalities of global government are here to stay and will only get stronger. This invests every mechanism of global power with a resonance that the elites may not have intended to project. Surely, it adds inordinate significance to each battle; yet in a most difficult financial era there are many such skirmishes going on almost every day.

There is an alternative perspective, one we have advanced many times, which is that the Anglosphere elites seek to enhance and encourage the military, economic and political chaos that has gradually been descending on the world over the past few years. Despite their protests to the contrary, this arguments holds that the elites are actively working at various kinds of destabilization in the hopes of building up a single fiat-currency system that will further cement an global Order.

Just over the weekend, World Bank President Robert Zoellick's comments that a global economy is "one shock away" from a crisis in food supplies and prices received wide coverage. The comments, meant as a warning, seemed to us to express an almost hopeful sentiment. Zoellick and others like him seem to yearn for crises, one after another, that allow them to further expand their power and the reach of their international facilities.

But some shocks are more sought-after than others. A crisis that expands elite powers is a preferred one; but these days economic, military and political crises often threaten to undermine the authority and structures of the powers-that-be. Finland is a good example. EU regulatory authorities spent weeks downplaying the idea that Finnish Euroskeptics would win enough votes to have an impact in Finland as regards the larger EU debate over PIGS insolvency. And yet this has proven not to be true.

The "True Finns" party has now surged from just 4.1% of the vote (in 2007) to about 19% four years later. Finland's parties can veto financial bail-outs, and the head of the True Finn's party is already on record as saying there will need to be changes to the Portuguese bailout plan that is in the midst of being negotiated by the IMF. "The package that is there," True Finns leader Timo Soini is reported as saying, "I do not believe it will remain."

Spain itself remains a concern. Late last week there were more denials about the severity of the country's economic condition. According to a recent article posted at Bloomberg, Belgian Finance Minister Didier Reynders believes Spain's fiscal position has improved and that "Spain [has] a better position than before," Reynders, in an interview with Bloomberg, said "Spain [is showing] a very good improvement and I am sure that it will be enough."

Reynders optimism was echoed by European Union Economic and Monetary Affairs Commissioner Olli Rehn who is "quite confident," according to Bloomberg, that new financial aid to Portugal will finally stem the rolling, year old Sovereign debt crisis. (Tell that to the Finns.) Yet the Wall Street Journal is not sure about Spain's position and in a fairly detailed article posted over the weekend, Irwin Stelzer summed up the Spanish economic outlook in terms that were decidedly less optimistic:

Spain's central bank expects the economy to grow a mere 0.8% this year and 1.5% in 2012. Even that is above the economists' consensus forecasts of 0.6% and 1.2% for those years, and far above Citigroup Global Markets' forecast of "close to zero." Stunted growth will make it very difficult for Spain to reduce its deficit from the 2009 peak of 11% and over 9% in 2010 to 6% this year. "That target will not be breached," promises Ms. Salgado.

Only maybe, since Madrid is finding it somewhere between difficult and impossible to rein in the spending of largely autonomous regional governments. The unemployment rate seems stuck above 20% (40% for younger workers), jobless claims rose to 4.3 million last month, and analysts at Citigroup say that "unemployment has resumed its rising path." Real disposable income is declining at the fastest rate since records began in 1970. This hardly suggests a recovery in domestic demand is around the corner.

To make matters worse, the ECB's interest-rate increases will raise the monthly mortgage payments of Spanish home-owners, already hit by rising inflation. Then there are the twin problems: the housing and banking sectors. There are about one million unsold homes on the market, which researchers at financial consultant GaveKal point out is three times the inventory in the U.S. on a per capita basis. Don't look there for new construction jobs for many years.

But do keep a close eye on the banking sector, which Fathom Consulting estimates has to roll over debt equivalent to 5% of the nation's GDP this year and 9% in 2012. Spain's banks have an estimated exposure of €65 billion to Portugal, the largest of any euro-zone country and twice the exposure of Germany and of France. With house prices falling and default rates set to rise, the already under-capitalized banks will need to raise about €20 billion to offset write-downs, says the government; Moody's says that the cost of filling the balance-sheet hole created by write-downs could be as high as €120 billion.

In deciding whom to believe consider this: The government proudly announced that China's sovereign wealth fund had agreed to invest €9 billion in Spain's banks, the fund's largest single investment. Untrue, says China Investment Corporation. An "error of communication" says an embarrassed Spanish government.

Again, it may be that the powers-that-be seek additional chaos, especially when it comes to the euro. The idea would be that so long as the EU itself remains a regional power, the euro can be swapped out for an international currency based on the IMF's SDRs and global governance would therefore be much advanced.

Of course this is a very neat scenario and in real-life things are seldom, if ever, so neat. What seems clear is that the elites are not shifting the course nor the urgency with which they are approaching globalization. Because the veil of secrecy has been ripped away, intimidation – immovable rigor – is what's left.

But this implies a kind of cognitive dissonance, a contradiction in terms. If there can be no turning back and if each elite facility and each military action must sustained without retreat, then how does one create sufficient chaos? At some point, elite mechanisms themselves must be seen to fail or chaos can cannot sufficiently increase. But if the mechanisms fail publicly, then the aura of invincibility that the elite seems to want to cultivate is penetrated and degraded.

After Thoughts

We have no answers – only observations. It seems to us that the Internet itself is apparently pushing the power elite into a series of contradictory platforms and strategies. The elites may seek chaos out of which to build more centralized global governance, but they will have to compromise their own structures to do create it. We shall watch with fascination to see how this is accomplished. We wonder if it can be.