Monday, October 10, 2011

Slovakia will vote on EFSF tomorrow

The expansion of EFSF, a European fund introducing an even larger dose of the financial communism into the eurozone, has been okayed by all eurozone countries except for Malta and Slovakia.

Horehronie, a Slovak song

It's generally believed that Slovakia is a more genuine obstacle not only because Malta is 10 times smaller; Malta is simply expected to approve the policy tonight. (Update 8:52 pm: procedural complaints before unanimous authorization.) Our Slovak brothers will vote tomorrow. EFSF is generally known as "euroval" which may be kind of translated as the "eurobarrier" or "eurowall". ;-)

In 2010, Slovakia managed to escape from the need to throw billions directly into the Greek toilet although they co-operated in the establishment of a "non-Greek" small EFSF at that time. Even the senior party of Ms Radičová's right-wing government, her party, was against donating billions to a country with a bad B-scale rating.

However, in 2011, when Greece's rating is in the C-category, Ms Radičová's party suddenly seems to have surrendered. She plans to vote Yes to the expansion of EFSF. Their libertarian junior coalition partner, SaS led by the parliamentary speaker Richard Sulík, remains principled.

Richard Sulik (Reuters portrait) was born in Bratislava, (Czecho)Slovakia in 1968. However, when he was 12, in 1980, his family emigrated to West Germany (through Yugoslavia, a common intermediate step for emigrants). He would study physics (!) and later economics at the LM University in Munich (where LM is not your humble correspondent).

Three days ago, Spiegel published an interview with him:
'The Greatest Threat to Europe Is the Bailout Fund'
You may see that Sulík believes that the euro is a good project but he is among the last living politicians who actually want to obey the rules of the eurozone, including the ban on bailouts of individual countries. Much like your humble correspondent, he argues against financially counterproductive, idiotically communist superstitions about "domino effects" and consequent "needs for everyone to share their money".

Every country, every bank, and every investor has to be responsible for its/his/her own banking account and decisions. And bankruptcy is a part of capitalism whenever it works. Greece has to be allowed to go bankrupt much like a couple of banks that have made too risky investments. Other countries may save the individual citizens' savings but that's cheaper than saving whole banks which, in turn, is cheaper than saving whole countries.

Bratislava, the capital of Slovakia: from Climate in Bratislava

Politicians shouldn't make their decisions by watching the stock indices.

From a moral perspective, demanding that Slovakia pays something like $10 billion to an irresponsible lazy nation where people work 2 times less than the Slovaks but have 3 times bigger salaries and pensions is just outrageous and immensely demotivating. According to a poll in a Slovak WSJ counterpart, 2/3 of the people would vote against the eurowall.

For a text about the atmosphere, see
Euro success Slovakia torn over saving currency zone
Slovaks had to work hard and they did pretty much everything correctly: and now they have to pay un-Christian amounts of money while a morally collapsing nation that has screwed pretty much everything and that got used to an unsustainable version of socialism is supposed to be constantly getting dozens of billions of dollars a month for free?

Obviously, this is not a sustainable way to manage Europe.

What will happen tomorrow? Sulík and his party may become scared of the pan-continental pressure but I guess that they won't. What seems more likely to me is that the opposition will soften their attitude. (Update Monday 9 p.m.: indeed, Sulík et al. remain tough, an agreement about a Yes vote is extremely unlikely now. Rumors suggest that Ms Radičová, the prime minister, thinks the situation is hard and has offered her resignation to her party.)

The main opposition party, a social democratic populist party called "Smer" ("Direction"), claims that they will vote against the expansion of EFSF. They are only ready to change their mind if the prime minister promises them early elections.

Slovak National Anthem and, since 1:30, some countryside folk songs

However, even though Robert Fico of Smer is a nationalist and seemingly independent populist maverick ass*ole, he still wants to paint his party as a member of the Socialist and Communist International Mafia, or whatever is the exact name of the loose gang of the socialist parties in the EU. And I guess that the politically correct attitude in this Mafia is to support the expansion of EFSF and all those plans to throw additional hundreds of billions of euros into socialist toilets such as Greece.

After all, isn't the stealing of the money from the people who work and create values and throwing this money to mouths of those who don't work too efficiently or who don't work at all, those who just scream and hate and who are constantly jealous, the very defining property of left-wing politics?

So my guess is that Sulík's SaS will be able to vote against the EFSF and they may do so even if there is a risk that Slovakia will indeed veto these EFSF plans. However, I also think that Slovakia won't veto it because the socialist Smer deputies will support the proposed bill and they will ultimately receive nothing for these votes because everyone in Slovakia, including them, realizes that this is actually a plan supported mainly by their own soulmates, so it would be crazy if they voted in a more libertarian way than the libertarian party.

However, it's unfortunately plausible that the first vote will be against EFSF (including Smer) but there will be another, second vote (a possibility that Fico may be planning) that will end up as Yes because of Smer. In that case, Sulík's SaS that opposes a second vote (it's not ethical to keep on voting until we get the "EU-right" result!) may get angry and leave the coalition. At any rate, it's somewhat likely that these games will lead to the collapse of the Slovak government. Imagine how crazy it is: social engineering trying to resuscitate a financially dead (and increasingly stinking) body of the Greek nation may lead to the collapse of a government in a completely healthy country - and maybe even to the re-introduction of Fico's assh*les from Smer. This is a natural selection upside down, a dictatorship of socialist zombies. That's how the EU wants to organize itself: stinky losers and assh*les in, good and successful politicians out.

Elli Paspala (Greece): Summertime in Prague

Meanwhile, the Czech lawmakers are trying to delay a vote on another European fund, ESM, a future "permanent" replacement of EFSF (that should expire in 2013 or later, when things are repaid, which may be never haha) that could mean that Czechia will sign a bianco cheque to throw $15 billion into the toilet. Richard Sulík (SK) has personally warned us.

Hungary and democracy

Many Slovaks were happy to see an article in the Financial Times that argues that Hungary is ceasing to be a democracy. While I understand why many Slovaks are happy ;-), I find the article extremely exaggerated, to say the least.

Fidesz, a moderate right-wing party, simply achieved an outright and clear majority in the Hungarian Parliament so they are strengthening mechanisms they consider important for the functioning of the country – such as mechanisms enforcing fiscal responsibility. A fiscal committee currently close to Fidesz – which is obvious because it was introduced by Fidesz – will have the power to dissolve the Parliament. It may look controversial but it is surely healthy, especially in countries with the debt of 80% of GDP or even more. Greece should have had such things for years.

This doesn't really undermine democracy in any sensible way. It's just a new law that Fidesz rightfully considers important - a law that even the Parliament is obliged to avoid extreme overspending – and the committee is just a lasting body to impose the law. The committee may be abolished with another change of the constitution which requires the same majority that this law has managed to win.

I just don't see anything shocking about it. If someone thinks that a pillar of democracy is that the governments and Parliament must have the right to decide to spend the money they don't have, then I am all for suppression of this kind of "democracy".

Fidesz is also trying to charge three former socialist PMs with mismanagement; under their supervision, the debt went from 53 to 80 percent of the GDP. Well, they surely have a point. When you're a socialist prime minister (or finance minister) who makes himself look nice out of borrowed money that you will not be obliged to repay, you have the freedom to do so – but you may also be held accountable for your immoral behavior in the future.

Again, I am mostly with Fidesz. A retroactive legislation would be bad but I don't really see in what sense it is retroactive. Misappropriation and throwing your nation into big trouble was generally illegal even during the socialist governments; it was just not quite well-defined in the context of the government's behavior. Fidesz is just giving a sharper definition to things that were at least morally in conflict with the general laws and justice – that were just too vague so that all the culprits could always escape their responsibility.

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