The Irish Referendum on the EU Fiscal Compact Treaty - Vote 'NO'

Irish Referendum on the EU Fiscal Compact Treaty 

May 31^st 2012

The Irish Government has announced that the referendum to amend the Constitution to allow the State to ratify the EU Fiscal Compact Treaty (formally, the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union; also called the Fiscal Stability Treaty) will be held on May 31^st.

The battle-lines were drawn as soon as the Government received the AG's advice of the necessity to hold a referendum. With the announcement of the date the campaign will begin in earnest. So, what's it all about?

In it's simplest terms this Treaty provides a legislative basis to give the EU overarching control of the constituent economies of the eurozone area. 


Oh, right. Sorry. 


That's EU-bureaucratic speak, for it's gives the EU complete financial control over the economies, and by extension, the budgetary policy of the eurozone member states.

Let's do that again;

it's gives the EU complete financial control over the economies, and by extension, the budgetary policy of the eurozone member states

This will be achieved by the imposition of a national requirement to have national budgets that are in balance or in surplus. The European Court of Justice would fine a country up to 0.1% of GDP if this has not been done this a year after ratification. It will create a fiscal union across the eurozone with strict and enforceable fiscal rules and automatic penalties where these rules are not kept. The EU, or more specifically, Germany and France will be calling the shots on the fiscal policies of the EU member states. Countries dancing to this tune will then, and only then, be allowed access funding from the ESM (European Stability Mechanism), a permanent rescue fund to be established in tandem with the ratification of this Treaty. In other words, do with the Germans say and they will (continue to) give you bailout money. Otherwise, it's even more hardship and suffering as your hung out to dry.

In short – it's a classic hobson's choice (with a twist – see below). Austerity or more Austerity?

So, in the specific case of the Irish Republic, why do I advocate a 'NO' vote? The reasons are many and complex. It would be disingenuous of me to reel of the bog standard pisspoor arguments of the anti-Europe faction in Ireland. There is a always a vote 'NO' brigade on the far left of the political spectrum who I really believe only oppose referenda because the government of the day supports and proposes the amendment. The old chestnuts like neutrality and abortion cannot be trotted out either. This is purely financial. 


Here are the main reasons I advocate a 'NO' vote;

1. On the grounds that this is a treaty that will entrench, indeed, embed within an EU legislative framework the austerity measures being endured by Irish people. VOTE 'NO'
2. On the grounds that the process of stripping Ireland of her economic sovereignty, begun by the EU/ECB/IMF in November 2010 would be completed. Our economic independence would be lost to Brussels, or more accurately, Germany. VOTE 'NO'
3. On the basis of (1) and (2) above, it is clear that this is an austerity treaty. VOTE 'NO'
4. Ireland is being forced by the pre-existing bailout deal to pay bondholder debts for banks the state itself now owns. Despite election pledges to the contrary. VOTE 'NO'
5. Any remote possibility Ireland has of renegotiating the terms of the 2010 bailout deal would be gone for good. Actually, they would be reinforced. We would be unable to restructure our own debts. VOTE 'NO'
6. On the basis of (4) and (5) above, Ireland would be locked into a depressive economic cycle that could take generations to break out of. VOTE 'NO'
7. Because our inequitable flat rate household charge is EU/ECB/IMF imposed. VOTE 'NO'
8. Because of all the other sneaky charges Edna & Co have in store (septic tanks, water rates etc.) VOTE 'NO'
9. Because of everything we have learned from the Mahon Tribunal report about our corrupt and rotten political system and politicians. From all parties. Because I am sick of them robbing us blind and laughing at us. VOTE 'NO'

Now here's the real rub, as far as this Treaty and the direction Europe is taking. I describe it as the EU democratic deficit. Because in order to ensure the big players get their way in Europe, through this Treaty, in response to the sovereign debt crisis and to ensure that no one country (especially a small irrelevant like Ireland) can no longer hold up the European project, a la Lisbon, they have rewritten the rules so that our vote, our referenda don't matter anymore.


Let me explain;

The powers that be in the EU (Germany and France that is) have been stumbling around in the dark in response to the EU sovereign debt crisis. Their answer is wrapped up in this Fiscal Compact treaty. And it is EU Fiscal harmonisation. Controlled by Germany of course. This was what they initially wanted to achieve with the proposed EU Constitution. That was dropped like a piece of hot coal when Spain rejected and it looked likely the French people would do the same. The lack of centralised economic control was what undermined the EURO right from the outset. Sure, the Germans had nominal control at that point and as long as the economic outlook (artificially fuelled during the 'boom' years and underpinned by a strong German economy) stayed good things were OK – but the sovereign debt crisis exploded that myth. Having invested so much in the EURO and the European project the EU couldn't afford to let the EURO collapse.

Now, it was OK, to force (frighten, coerce, threaten, take your pick) Ireland into second referendums on Nice & Lisbon. But that would not be done in Spain or France (EU Constitution). And what if some pesky country like Ireland voted down their precious Fiscal Compact? (In any event only Ireland of 27 eurozone members is bound to hold a referendum, the UK has not endorsed the Treaty and will remain outside) Or if Greece fell apart before it came into effect? (Quick, throw some bailout money their way).

The answer was simple. With the stroke of a pen 60 years of the European project was jettisoned. Only 12 countries need ratify the treaty by January 1^st 2013 for it to come into effect. (That's Germany, France, Spain, Holland, Belgium, Luxembourg, Italy, Denmark, Sweden, Portugal, Malta & Finland maybe??) The rest can sink or swim. Once the treaty is in effect, you will be cut off quick if you don't play ball (that is surrender to fiscal federalism). Being inside is no guarantee of not being cut adrift or being forced out of the EURO. This is the new EU sponsored democratic deficit. It smacks of arrogance and smugness and a complete disregard for a small nation like ours. So, now I am wondering - is Ireland better off without the EU?

A 'NO' vote from Ireland won't stop this. The EU gerrymandering has ensured this. But let them have it. Ireland, along with our largest trading partner, the UK, (a good enough reason on its own) is better of out of this. Then we would have the opportunity (if not the politicians, but hey, lets do one thing at a time) to map our own way forward out of this economic mire. Iceland and Argentina are good reference points for us here.

There is an alternative. Vote 'NO'.