An ECB banker wants to change the European social model

Michel Barnier, Member of the EC, Jonathan Faull, Director General of the DG "Internal Market and Services" of the EC, and Benoît Cœuré, Member of the Executive Board of the European Central Bank (ECB) (from left to right). (EC Audiovisual Services).

Michel Barnier, Member of the EC, Jonathan Faull, Director General of the DG “Internal Market and Services” of the EC, and Benoît Cœuré, Member of the Executive Board of the European Central Bank (ECB) (from left to right). Conference on “Financial Stability and the Single Market-The Keys to Growth in Europe (EC Audiovisual Services).

A banker, member of the European Central Bank’s executive board, in the brief time of half an hour, during which he delivered a speech on Saturday 2 March, in the context of the European Conference at Harvard, wanted not only to ‘correct’ the Europe’s social contract but also to demolish John Maynard Keynes’s contribution to economics. The hopeful social reformer of course has nothing to do with politics. It’s someone, going under the name of Benoît Cœuré, appointed by France in the office he currently holds. Alas nobody is infallible, not even the well-structured French public administration that takes care of such appointments. But let’s turn to what actually said this ‘mountain’ of wisdom.

He started by saying: {At the heart of the crisis, there is the challenge of redefining the social contract to safeguard the sustainability of Europe’s social economy model. This model, set out in the Maastricht Treaty, notably aims to promote “social justice”, “solidarity between generations” and “solidarity among Member States”…. As I will strive to show, a redefinition of the social contract in Europe is essential if we are to restore the sustainability of public policies as well as trust in the state’s ability to positively influence economic outcomes}.

Nowadays all the newly minted ‘long term’ economists declare they are not happy with the way our European social model works. This French one discovered all by himself that Europe needs a good socio-economic reshaping and of course a political reshuffle. He aspires that us Europeans after reading his speech we will be convinced, he is the chosen, to reveal to us why we need a good revisiting of our way of life and how to do it; Obviously we are not convinced.

The ‘tools’

As we all know ‘long-term’ economist love ‘tools’. But in order to convince us that Europe needs those ‘tools’ to be happy in the long run, Benoît had first to demolish Keynes, because this great economist detested the long-term theories. The ECB member tried to bring down Keynes with three lines as it follows: {John Maynard Keynes famously said: “The long run is a misleading guide to current affairs. In the long run we are all dead”. And yet societies live in the long run”}.

There goes Keynes in the dustbin and Benoît introduces Thomas Hobbes, who remarked in his “Leviathan” that {“sovereign states are established to regulate social interactions and avoid the “war of all against all” that would prevail without the rule of law}. No wonder why Benoît loves Hobbs. This last one did not recognise any other role for the sovereign authority than the one of ‘gendarme’, no social care no nothing. It’s not only that. Hobbs is renounced for his anti-democratic ideas. For one thing he explicitly rejected the idea of Separation of Powers. According to Wikipedia, {Part 6 is perhaps an under-emphasised feature of Hobbes’s argument: his is explicitly in favour of censorship of the press and restrictions on the rights of free speech should they be considered desirable by the sovereign in order to promote order}. Those are probably the best ‘tools’ in the mind of this banker who wants to reshape Europe, .

The problem is however, that modern governments are cashing in almost half the Gross Domestic Product in taxes. Benoît says nothing about how governments should use their tax incomes, if they stop spending much of it on social policies. Obviously this ‘long term’ French economist has in mind that the part of taxes the government is not using for social policies can be directed to protect the banks. He says that indirectly in the following quote:” The basic premise of the new social contract between euro area countries, then, is that countries have to abide by the rules of the community, and when they do, they become eligible for mutual support. Euro area governments have earmarked €700 billion for countries that get into difficulty, a sum which can be lent against strong conditionality”.

The truth is however that those €700 billion from taxpayers’ money and much more from ECB’s printed money, also ultimately to be paid by taxpayers, is currently used to recapitalise the banks and support their liquidity. This is the ‘good use’ of people’s money according to Benoît, the little French economist turned in half an hour into social philosopher – transformer of Europe. In reality what he wants is that governments stop spending money on people and hand it to bankers.

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

the European Sting Milestones

Featured Stings

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

‘We are nowhere closer’ to Israeli-Palestinian peace deal, than a year ago, Security Council hears

The result of European Elections 2019 seals the end of the business as usual era in Brussels

ECB: A revolutionary idea to revitalize the European economy with cheap loans to SMEs

South Korea once recycled 2% of its food waste. Now it recycles 95%

Agreement reached on new EU Solidarity Corps

EU and U.S. castigate Facebook on Cambridge Analytica scandal as citizens’ data privacy goes down the drain again

Pesticides: MEPs propose blueprint to improve EU approval procedure

EU, Latin America and the Caribbean: Partnering for prosperity, democracy, resilience and global governance

“There are many converging visions and interests between the One Belt One Road initiative and the Juncker Investment Plan”, Ambassador Yang of the Chinese Mission to EU highlights from Brussels

Novartis and Johnson & Johnson to deprive Europeans of their right to Health

We need impartial LGBT+ news to advance human rights

On our way to China

The EU wants to create 10 million smart lampposts

How smartphones can close the global skills gap for billions

Is deflation a real danger for Eurozone?

How to beat gender stereotypes: learn, speak up and react

‘Revved up climate action’ needed to counter ‘prolonged’ and deadly storms like Cyclone Idai: Guterres

EU-Russia summit in the shadows of Kiev’s fumes

A safer, more dignified journey for all migrants, tops agenda at global conference in Marrakech

Cloud computing under scrutiny in the EU?

First EU-wide protection for whistle-blowers agreed

Local innovation, international impact: SMEs and the ITU Telecom World Awards

Mobile 360 Series – Russia & CIS: Empowering the Digital Economy

Humanitarian aid: EU mobilises over €18 million for the Central African Republic in 2019

The EU Commission lets money market funds continue the unholy game of banks

Modern farming is harming the planet. Tech-driven permaculture could heal it

‘At risk’ Mediterranean forests make ‘vital contributions’ to development

New rules for short-stay visas: EP and Council reach a deal

EU Parliament: Deposit guarantee and trading platform transparency sought

This Mexican company is making biofuel from cactus plants

Trump fines China with $50 billion a year plus some more…

How Japan can take the lead with an ageing workforce

The 28 EU leaders show contempt for the European Elections results

Responsible Artificial Intelligence

Budget MEPs approve €34m in EU aid to Greece, Poland, Lithuania and Bulgaria

Syria: UN chief welcomes first aid convoy to Rukban camp since January, joint agency operation assists 50,000

‘Vaccines are safe’ and save lives, UNICEF declares, launching new #VaccinesWork campaign

FROM THE FIELD: Saving the tree kangaroos of Papua New Guinea

Technology can help us end the scourge of modern slavery. Here’s how

Why do humanitarian crises disproportionately affect women?

Who are the winners and losers in Africa’s Continental Free Trade area?

DR Congo Ebola outbreak now a Public Health Emergency, UN health agency declares

Guinea-Bissau needs ‘genuinely free and fair elections’ to break cycle of instability

UN ‘comes together in sadness and solidarity’ to honour staff who died on board Ethiopian Airlines flight

Main results of EU Environment Council, 25/06/2018

How the gig economy can transform farms in the developing world

Yemen: ‘No justification for this carnage,’ says UNICEF chief, as children in need now outnumber population of Switzerland

Migration crisis update: The “Habsburg Empire” comes back to life while EU loses control

How Eurozone consumers spend their income when they have one…

Tackling terrorism: MEPs approve tighter rules on homemade explosives

You might soon be travelling without a passport – this is how

Recession: the best argument for growth

One Hundred Years of Qipao History: from Shanghai to EU

EU fight against tax-evasion and money laundering blocked by Britain

The Five Chinese Girls

Support for EU remains at historically high level despite sceptics

We probably should go back to the therapy in Primary Healthcare

Sudan: Health challenges in the Sustainable Development Goals era

Women ‘vital’ to peace efforts and ensuring long-lasting stability in Afghanistan

FROM THE FIELD: Murals help heal wounds of bloody conflict in Guatemala

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s