Germany Wins Battle Over Banking Regulation

Germany Wins Battle Over Banking Regulation

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Germany proves it controls Europe, and ensures things stay that way.

European Union leaders announced that they had decided on banking regulation in the early hours of the morning, December 13. European leaders hailed it as a great success. But a success for whom?

Germany got its way on just about every issue. These bank regulations demonstrate who controls Europe now, and will help Germany continue its control into the future.

Under the agreement, the European Central Bank (ecb) will oversee Europe’s largest banks. No eurozone members will be able to opt out. There are a lot of details, but the gist of the matter is that Germany wanted a small, impotent new bank regulator, and that is what it got. There are a few reasons for this:

  • Germany wanted its local banks free of the regulation. Some of these banks are dodgy—state-owned and lending money for risky, local government projects. They’re an important part of how Germany’s local government and companies are funded, and Germany doesn’t want an external regulator prying into that.
  • It doesn’t want to distract the ecb from its core purpose of preventing inflation. Germany is very concerned with inflation and it worries that giving the ecb more to do will detract from its main function.
  • Out of Europe’s roughly 6,000 banks, only 150 to 200 will be subject to the ecb’s regulation.

    But there is a more nefarious reason for Germany’s opposition. Currently, the eurozone is caught in a vicious cycle that drives nations to Germany. In Ireland, for example, the nation’s banks got into trouble. The government bailed out the banks, but this led to the government itself getting into financial difficulty. So Ireland was forced to turn to Germany and submit to its terms. The same process is going on in Spain right now.

    The ultimate goal of the banking union is to break this cycle. Instead of the banks getting bailed out by the government, they’d get bailed out by a central EU fund. If this was put into place, German money would bail out the banks directly. The national governments would remain solvent. Germany would get no control over nations.

    Handing over money without being able to control how it is spent is exactly what Germany is trying to avoid. From the German point of view it is quite reasonable—why hand over billions of euros if you can’t stop the nation you’re lending it to from repeating its mistakes and needing another few billion in a few years’ time?

    But, no matter how it looks to Germany, the process forces nations to hand over sovereignty. Once a nation is bailed out, democratically elected governments no longer make decisions about how taxpayers’ money is spent. European officials do it. It is a mild form of occupation.

    Last week’s deal will do nothing to stop this process. Countries whose banks get into trouble will still need to go to Germany for help. There may be some exceptions to this for the more “important” members of the eurozone. Spain, for example, was able to get a much better deal for bailing out its banks than Ireland.

    Allowing a central fund to bail out banks, something that would really stop the cycle, was kicked into the long grass. And Germany doesn’t want Europe to make any progress on this any time soon. “Angela Merkel has made it clear that Berlin is not ready to pay for the resolution of other people’s banks,” wrote the Financial Times’ Wolfgang Münchau.

    “The most I would expect is a small resolution fund, financed by the banks themselves—something too small to do the job,” he wrote.

    German politicians, including Chancellor Angela Merkel, have called for something resembling a European superstate. This implies they will form a banking union with a real bank bailout fund at some point. But Germany doesn’t want it quite yet.

    A European superstate is coming. But it will happen on Germany’s terms. Any efforts at integration, like this banking union, that come at the wrong time for Germany’s liking, won’t succeed.

    Spain Has Committed Repeated ‘Acts of War’ Over Gibraltar

    Spain Has Committed Repeated ‘Acts of War’ Over Gibraltar

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    Spanish ships have sailed into Gibraltar’s territorial waters 197 times this year, it was revealed recently as a British member of Parliament accused Spain of committing an “act of war.”

    The British government’s figures show that Spanish state vessels entered Gibraltar’s waters 23 times in 2011 and 67 times in 2010. By the end of November this year, that figure was at 197.

    Spain is deliberately making an issue of Gibraltar right now.

    “I am sure that the entire House will be shocked, angry and dismayed at the continual incursions by the Spanish government into the waters around the British sovereign territory of Gibraltar,” Conservative M.P. Andrew Rosindell said in Parliament December 13. “This is an act of aggression. Will the leader of the House ask the defense secretary and the foreign secretary to make an urgent statement on what Her Majesty’s government will do to ensure that these illegal incursions into British sovereign waters are stopped forthwith?”

    In his reply, the leader of the House, Andrew Lansley, announced that two Spanish naval vessels had entered British Gibraltar territorial waters on December 10.

    Later, another Conservative M.P., Bob Stewart, stood to “gently remind the House that an illegal incursion into British Gibraltarian sovereign waters is technically an act of war.”

    “What is happening at the moment is wrong, and we should do something about it,” he said.

    However, Lansley indicated that the government doesn’t plan to do much beyond “making a formal diplomatic protest to the Spanish government making it clear that such incursions are an unacceptable violation of British sovereignty.”

    Britain has made 21 of these complaints already this year. They have accomplished nothing. Britain’s most muscular response so far has been to have the frigate hms Sutherland make a quick stop in Gibraltar on its way back from anti-piracy patrols in the Indian Ocean.

    Spain’s persistence shows it is still committed to winning Gibraltar back. Britain came close to giving the Rock away in 2002. There’s little sign it values it much now.

    In fact, Bible prophecy says that Britain will lose Gibraltar, along with the rest of its sea gates. For more information on this, see the chapter “Changing of the Guard” in our free booklet He Was Right.

    Mourners of Elementary Massacre Search for Answers

    Hungarian Anti-Semitism—Trendsetting for Europe?

    Hungarian Anti-Semitism—Trendsetting for Europe?

    Leigh Phillips/flickr

    Is it the 1930s all over again?

    Martin Gyongyosi, the leader of Hungary’s third-strongest political party, said on November 26 that the government should draw up a list of Jews who pose a national security risk. “It is high time to assess how many MPs and government members are of Jewish origin and who present a national security risk to Hungary,” Gyongyosi said in front of parliament as he described how Jewish parliamentarians had influenced Hungary’s foreign policy concerning Israel’s conflict with the Palestinians. The Anti-Defamation League has described Jobbik, the party Gyongyosi represents, as openly anti-Semitic in its policies. Jobbik is the third-strongest political party in the nation. The fact that such an openly anti-Jewish party is supported by nearly a tenth of the population should set off alarm bells.

    Last Wednesday, Hungarian Foreign Minister Janos Martonyi condemned Gyongyosi’s remarks in the strongest terms, calling them “completely unacceptable.” Gyongyosi’s comments have galvanized usually-polarized Hungarian politicians. Representatives from the ruling Fidesz party, as well as the socialist and centrist parties, spoke at a rally on December 4 to show support and solidarity with Hungary’s strong Jewish minority. But the real story is in how long it took the government to say anything at all about the radical politician’s racist remarks. It took a week for Prime Minister Viktor Orban to personally speak out against Gyongyosi’s pre-World War ii-style invective, and that was the day after the December 4 rally in front of the parliament building. Nine days after the Gyongyosi’s comments, the foreign minister came out with his condemnation.

    The Economist noted the government’s obvious reluctance to strongly condemn Gyongyosi: “As outrage grew over Mr. Gyongyosi’s speech, Fidesz’s political calculus seemed increasingly squalid. Even usually reliable allies turned on the government. A stinging article in Magyar Nemzet, a conservative daily, called on the country’s right wing to ‘wake up’ about the danger from the extremists.”

    The Economist concluded that Gyongyosi’s comments have served to unite Hungary against anti-Semitism. But is that really the case?

    Historically, Hungary has been an inhospitable place for Jews. They were persecuted going as far back as 1092, when the Roman Catholic Church decreed that Jews could not intermarry with Christians. In the late 17th century, the Habsburg dynasty forced Jews out of major cities. But in spite of the persecution, many Jews still migrated to Hungary from Poland and Moravia for its economic opportunities. When World War i began in 1914, over half of all Hungarian merchants were Jewish.

    Anti-Semitism in Hungary continued into the 1920s, when numerous laws were passed that limited Jewish participation in society but weren’t openly anti-Semitic. The first so-called “Jewish law” was passed by the Hungarian Parliament in 1938 and placed quotas on how many Jews could be employed in certain sectors of business and industry. In 1939, new Hungarian legislation limited Jewish participation in commerce to 5 percent. The hatred grew on into World War ii. From 1941 until the time of German occupation, some 63,000 Hungarian Jews were killed. Another 400,000 were relocated to Jewish ghettos by Adolf Eichmann starting in 1944. An estimated one out of every three Jews killed at the Auschwitz concentration camp was Hungarian.

    History shows that anti-Semitism has been a staple of Hungarian politics and sentiment. And in the lead-up to both world wars, anti-Semitism gained in both popularity and political standing. The Hungarian prime minister may have publicly denounced Martin Gyongyosi’s desire for a list of dangerous Jews, but his slow reaction time speaks volumes.

    Anti-Semitism may not be the vogue that it was in Europe leading up to World War ii, but anti-Israel sentiment is high. The Anti-Defamation League released a report in March measuring the attitudes toward Jews in 10 European nations. The League asked people to respond with “probably true” or “probably false” to these statements: 1) Jews are more loyal to Israel than to this country, 2) Jews have too much power in the business world, 3) Jews have too much power in international financial markets, and 4) Jews still talk too much about what happened to them in the Holocaust.

    According to the report, “The data indicate that large percentages of Europeans continue to question the loyalty of their Jewish citizens.” More than half of the Hungarians interviewed felt that violence toward Jews is a result of anti-Jewish sentiment, as opposed to anti-Israel sentiment. The report also indicated that anti-Jewish sentiment has increased dramatically since 2009, especially in the UK, Spain, and Hungary.

    The overarching message of the March report and the recent bold statements from Hungary’s far right is that anti-Semitism is not just increasing in a few isolated places, but across the majority of the Continent—a trend that is eerily similar to the 1930s. History tells of what came after that. But the good news in the midst of the gathering storm is that the world is gearing up for its final war—a globe-encompassing war that will culminate in the return of Jesus Christ. (For more information on the hope contained in the increasing troubles of this world, read our free booklet The Wonderful World Tomorrow—What It Will Be Like by Herbert W. Armstrong.)

    Another Unthinkable School Shooting Shocks the World

    This time, the deranged gunman targeted first graders.

    The world was left in a state of shock on Friday when a lone gunman broke into an elementary school in Connecticut and killed 20 children. Six women, including the principle and other school officials, were also gunned down. Why do these unimaginable tragedies keep happening? What motivates young people to commit such perverse acts of violence? And why are these shocking attacks becoming more frequent?

    Is a Third Intifada Beginning in the West Bank?

    Palestinians in the West Bank are taking note of what Gaza’s rulers have achieved by attacking Israel.

    On December 10, the Associated Press reported that Israel is voicing concerns that a third intifada might soon erupt in the West Bank. Here is a review of a few recent developments that have happened in the region.