Europees begrotingsverdrag: doodsteek voor de overheden

On March 2nd 25 European prime ministers have signed a novel treaty which will be legally enforced by the European Court of Justice; non-observance can result in fines up to 0.1% of the gross national product. Governments engaged to reduce their budget deficit to 0.5% of GNP, and to add this requirement to their constitution. The treaty will strongly diminish the power of governments and local autorities to maintain public services such as education, transport, health care etc. Anti-recession measures also will become impossible; a situation already effective in many countries (Greece, Spain, Portugal, Ireland, Italy). Economist Paul De Grauwe has strongly criticized the view that governments, in contrast to private corporations, should be forbidden to finance their activities through loans (bonds). The decision of the heads of governments is explained here as a hold-up of banks and corporations on public finances and policy supported by financial experts and conservative parties. The treaty is still to be ratified by national parliaments. Ireland has called a referendum. UK and Tchechia have rejected the treaty from the start.On March 2nd 25 European prime ministers have signed a novel treaty which will be legally enforced by the European Court of Justice; non-observance can result in fines up to 0.1% of the gross national product. Governments engaged to reduce their budget deficit to 0.5% of GNP, and to add this requirement to their constitution. The treaty will strongly diminish the power of governments and local autorities to maintain public services such as education, transport, health care etc. Anti-recession measures also will become impossible; a situation already effective in many countries (Greece, Spain, Portugal, Ireland, Italy). Economist Paul De Grauwe has strongly criticized the view that governments, in contrast to private corporations, should be forbidden to finance their activities through loans (bonds). The decision of the heads of governments is explained here as a hold-up of banks and corporations on public finances and policy supported by financial experts and conservative parties. The treaty is still to be ratified by national parliaments. Ireland has called a referendum. UK and Tchechia have rejected the treaty from the start.