JP Morgan: Too much European democracy

Yep, a bankster has finally confessed.

Democratic constitutions designed to thwart a resurgence of fascism are getting in the way of all that austerian reconstruction, says JP Morgan’s Europe Economic Research department.

The problem with all those constitutions is that they empower the populace, define limits to central power, and allow for those damnably inconvenient public protests.

Think we’re kidding?

Consider these excerpts from the 28 report The Euro area adjustment: about halfway there [PDF] by JP Morgan’s Malcolm Barr and David Mackie:

Political reform—hardly even begun.

At the start of the crisis, it was generally assumed that the national legacy problems were economic in nature. But, as the crisis has evolved, it has become apparent that there are deep seated political problems in the periphery, which, in our view, need to change if EMU [European Monetary Union is going to function properly in the long run. The political systems in the periphery were established in the aftermath of dictatorship, and were defined by that experience. Constitutions tend to show a strong socialist influence, reflecting the political strength that left wing parties gained after the defeat of fascism. Political systems around the periphery typically display several of the following features: weak executives; weak central states relative to regions; constitutional protection of labor rights; consensus building systems which foster political clientalism; and the right to protest if unwelcome changes are made to the political status quo. The shortcomings of this political legacy have been revealed by the crisis. Countries around the periphery have only been partially successful in producing fiscal and economic reform agendas, with governments constrained by constitutions (Portugal), powerful regions (Spain), and the rise of populist parties (Italy and Greece).

There is a growing recognition of the extent of this problem, both in the core and in the periphery. Change is beginning to take place. Spain took steps to address some of the contradictions of the post-Franco settlement with last year’s legislation enabling closer fiscal oversight of the regions. But, outside Spain little has happened thus far. The key test in the coming year will be in Italy, where the new government clearly has an opportunity to engage in meaningful political reform. But, in terms of the idea of a journey, the process of political reform has barely begun.


[I]t is possible that reform fatigue could lead to i) the collapse of several reform minded governments in the European south, ii) a collapse in support for the Euro or the EU, iii) an outright electoral victory for radical anti-European parties somewhere in the region, or iv) the effective ungovernability of some Member States once social costs (particularly unemployment) pass a particular level. None of these developments look likely at the present time. But, the longer-term picture (beyond the next 18 months) is hard to predict, and a more pronounced backlash to the current approach to crisis management cannot be excluded.

So the constitutions created to prevent the resurgence of fascism, a political system defined by Benito Mussolini as the fusion of the corporation and the state, are outmoded and downright inconvenient because they stand in the way of, well, fascism.

And since people are literally demonstrably angry at the gutting of the commons, governments need to implement the powers of fascist police states?

So. . . a Europe under a police state regime and under the domination of Germany. . .

Gee, who really did win World War II?

H/T to Moussequetaire.


One response to “JP Morgan: Too much European democracy

  1. Assurance Maladie Luxembourg

    this report only shows how bankers judge themselves as Gods… when in fact they are the most corrupted people of the world. We need to return to money parity with gold and and finish with the fraccionated reserve system this will not allow banks make virtual money. the dead penalty for corrupted bankers should be implemented as soon as possible as to politicians etc….

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