The full European Parliament on Tuesday gave its final approval to the rule giving new powers to the European Commission to monitor national budgets of eurozone countries and even request changes before parliamentary approval. According to this regulation, agreed with the Twenty, Brussels may force a state to ransom.
According to this rule, which goes ahead with 526 votes in favor, 86 against and 66 abstentions, the governments are obliged to send to Brussels its draft budget for next year by 15 October each year.
The EU executive may publish its opinion on the national and even request changes if it believes that deviate from the objectives of consolidation undertaken by each country. However, your request will not be binding.
In addition, the new standard allows Brussels submit to increased surveillance to countries that threaten the stability of the eurozone and even force them to ask for a rescue, with the objective of minimizing their costs.
Vice President of the Commission responsible for Economic Affairs, Olli Rehn, said on Tuesday that the adoption of this standard "will complete the cycle of budgetary surveillance for euro area Member States."
Rehn has argued that if these rules had existed since the birth of the euro "would never have experienced a crisis of such magnitude."
An Offer You Cannot Refuse
Rehn is a liar, a fool, or both. I vote both.
The EU had nothing but praise for Spain when the Spanish housing bubble was brewing. It would not have done anything other than what it did, which is cheerlead the housing boom, just as Bernanke and Greenspan did in the US.
I like the translation "force a state to ransom".
The EU has twice offered Spain a bailout. Spain has rejected the offer twice. The next offer just may be the one that Spain cannot refuse.
Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com
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