Europe’s Hotel California

Ana Herrero-WallaceWith the proposed new framework of MiFID II due to increase the supervisory powers of the European regulators, it’s been particularly alarming to watch as the EU’s heads of state try to solve the eurozone’s sovereign debt crisis. Greece’s Prime Minister, George Papandreou, threw a real spanner in the works when he announced his intention to hold a referendum to approve the latest bail-out plans. You could almost hear the collective gasp as his fellow EU members contemplated the potential ramifications of that for their own economies and the rest of the world!

Was that the sound of a collective sigh of relief I just heard as reports come in that the referendum will be scrapped if ruling and opposition parties strike a deal to resolve the country’s political crisis?

One thing’s for sure, nerves are being severely tested in Cannes right now!

Perhaps Mr Papandreou simply wanted to put pressure on Germany to negotiate a better package? Then again, it’s rumoured that he is to call early elections. Is he really willing to sacrifice the macro and micro economic fate of Europe to remain in power? Democracy comes from the Greek word demokratía – ‘rule of the people’ – itself an amalgamation of démos, (the people) and krátos (power). Another word derived from the same ancient language is demagogy!

Whatever the final outcome, it’s too bad that the members of the EU are trapped in both the Union and the Euro. In the words of the Eagles’ classic Hotel California, “you can check out any time you like, but you can never leave!”

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