Scaring the horses

Is it possible that the EU's latest attempt to activate the Doctrine of Beneficial Crisis?

Merkle and her friends have been using the economic crisis, particularly the parlous state of Greece to argue for a centralised Eropean Economic Government. One aspect of this is the demand placed upon the table that to ensure good fiscal discipline by the nation/member states of the European Union all should submit their draft budgets to the European Commission for vetting before presenting them to their national Parliaments.

European Union finance ministers will back on Tuesday a call for national budgets to be first reviewed by EU ministers before they are submitted for parliamentary approval, draft conclusions of the meeting showed.

The European Commission proposed last Wednesday that draft national budget plans should be vetted by the Commission and EU finance ministers to check if they are in line with the 27-nation bloc's economic policy guidelines.

"In light of their contribution to an efficient implementation of the Stability and Growth Pact, the Council calls for a regular assessment and peer review of Member States' fiscal frameworks," draft conclusions of the ministers, obtained by Reuters, said.

But this enormous power grab, the right to vet (which implies the right to veto) seems to have shaken some of the normal sleepwalkers.

In Sweden both the Finance Minister Anders Borg, and his shadow, Thomas Östros have publically opposed the move. To the them the move is "out of the question"
In Ireland the Fine Gael leader, Enda Kelly has been pretty clear over his response

Mr Kenny expressed concern about the commission’s proposals which he described as “quite opaque” and said it would mean “the political whim, colour or bias of the council at any time could influence what is being talked about here”.

He said “other countries might well be jealous of our low corporation tax rate” and could say “that we would have to make changes in public pay or corporation tax or adjust matters that might not be to our liking”.

Mr Kenny said he wanted an assurance from the Taoiseach “that in no circumstances will the Government hand over sovereignty of the running of our economy to anybody else who might have a different view

So what will boy George do when he visits Brussels next week. Well Sunday's papers are not suggesting it will be much fun for him.

The Express suggests that,

Pressure is on Mr Osborne to issue a firm rebuke to the plans and failure to do so will enrage Tory Eurosceptics.

But what is the point of a firm rebuke? These plans in draft now, like others which will be confirmed on Tuesday such as the Hedge Fund Directive for example come under QMV. So though this would be a massive transfer of power to Brussels, there is nothing he can do.

The Guardian has Brussels figures telling it,

"There are two ways of playing this," one Brussels official said last night. "Either the UK makes an argument for a delay, which they would probably lose, or they take the hit now and hope that in a few weeks this is forgotten."

So essentially, he has lost the fight over protecting the city (well done Hedge Funds chaps, it was worth all those donations wasn't it), and has a very short time to conjure a blocking minority on the Budget vetting.

There are allies out there in Sweden and Ireland, but he will need a lot more friends than that, and Brussels and the colleagues are not minded to be chummy.