Imagine Britain had joined the euro; no longer would the House of Commons have
the final say on budgets
If a parliament cannot decide how to spend its nation's wealth, what is the value of elections to it?
The Brussels EU executive flexed its new muscles by criticising the eurozone’s
biggest economies, but held back from issuing instructions for the rewriting
of budgets – for now at least.
Even so, by questioning Italy’s budget plans, it has ensured that political
stability and a fragile recovery in the eurozone’s third-largest economy are
now in greater doubt.
It is hard to overstate the significance of this political development in the
eurozone: the final say on spending and the distribution of national wealth
in countries that belong to the single currency no longer lies with
parliaments.
Imagine Britain had joined the euro; no longer would the House of Commons have
the final say on budgets, a democratic right that goes back to parliament’s
historic struggle with Charles I over “power of purse”.
Instead, the Chancellor would submit his budget to Brussels and, before a vote
by MPs, it would be chewed over by foreign officials and European finance
ministers.
Unelected EU officials would be able to issue instructions to change policies and, if a government or parliament refused to comply, could back this up with penalties imposed by judges in Luxembourg.
This raises the question: if a parliament cannot decide how to spend its nation’s wealth what is the value of elections to it? Yet this step has been taken in the 17 countries that belong to the eurozone – often with little or no public debate over such a profound constitutional step. This is a dangerous democratic deficit.
No political party in France, for example, has ever campaigned on a platform of surrendering national sovereignty in this way. It wouldn’t win an election if it did. Privately, French officials say they would ignore any attempt to veto their spending plans, but either way that could trigger a crisis.
If the Commission calls their bluff and overrules the will of parliament in the interests of the euro it would be a dangerous moment with an uncertain outcome. Alternatively, if it backed down to avoid a confrontation, would the euro face another crisis as markets realised its fundamentals were not solid?
The eurozone is still a fragile construction if it relies on such untested instruments in the name of fiscal stability.
Unelected EU officials would be able to issue instructions to change policies and, if a government or parliament refused to comply, could back this up with penalties imposed by judges in Luxembourg.
This raises the question: if a parliament cannot decide how to spend its nation’s wealth what is the value of elections to it? Yet this step has been taken in the 17 countries that belong to the eurozone – often with little or no public debate over such a profound constitutional step. This is a dangerous democratic deficit.
No political party in France, for example, has ever campaigned on a platform of surrendering national sovereignty in this way. It wouldn’t win an election if it did. Privately, French officials say they would ignore any attempt to veto their spending plans, but either way that could trigger a crisis.
If the Commission calls their bluff and overrules the will of parliament in the interests of the euro it would be a dangerous moment with an uncertain outcome. Alternatively, if it backed down to avoid a confrontation, would the euro face another crisis as markets realised its fundamentals were not solid?
The eurozone is still a fragile construction if it relies on such untested instruments in the name of fiscal stability.
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