A daily blog on the thrills, spills, and frequent absurdities of the world's one and only 'non-imperial empire' - as Barroso himself called it - the European Union.

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Sunday, 8 May 2011

The Union Shall Not Be Liable

Schengen, Luxemburg. Picture by Cayambe.

Anyone who seriously thought that we'd make a profit on our bailout contribution has now been emphatically silenced. Or, at least, they should be. Greece, the first country to receive a bailout and the first to come back for more, has openly threatened to default on its debt. It was always a ludicrous idea, of course, to hand more loans to a country heavily in debt, especially if the underlying problems that caused the crisis in the first place haven't even been discussed. But now we see just how ludicrous it was.

This is brilliant news for Eurosceptics - another economic prediction proved right, after the one about the euro that was made over twenty years ago, where were first warned of its collapse and were pilloried for the trouble. But it's bad news for Britain as a whole. We have poured almost ten billions of pounds into this 'loan,' and we will never get a penny of that money back. Even if, by some sort of shady backroom deal, Greece is somehow persuaded, amidst the prospect of renewed violence and civil insurrection, to turn back from the edge, and to pay its debts, it will still not be commercially viable. If it was, they'd have gone to a commercial bank, rather than relying on a bailout fund that is explicitly banned. In short, that money has been wasted. That's £10,000,000,000 of public funds. That's the kind of money that wars are fought over.

Those who said that it would be in Britain's national interest to hand over such an obscene sum have been proven wrong - if Greece defaults, we won't even break even, let alone make a profit, and as it's now back at the negotiating table asking for more money, with George Osborne once again denying Britian's involvement, it's a safe bet that it hasn't succeeded in stabilising the eurozone, either. But that's still one hundred and fifty pounds of public funding for every man, woman, and child in the country that's been spent. Ten billion pounds that could have been invested in our over-burdened, under-funded transport network, or our over-worked armed services has been spent on absolutely nothing. Illegally, according to Article 125 of the Treaty of the Functioning of the European Union, and as Angela Merkel says.

Since then, two more countries have asked for bailouts, and Britain has contributed another eleven billion pounds to the cause. Greece itself has came back to the negotiating table, asking for more. The costs of bailing out Spain will be larger than the costs of bailing out the other three put together. In total, over twenty-five billion pounds has been handed over, for no benefit.

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