Slovakia’s rebellion will be dismissed

 
Allister Heath
HOW typical. The Slovakian parliament last night voted against expanding the European Financial Stability Facility (EFSF), the Eurozone bailout fund. That is a major blow to the project: the new rules need to be ratified by all members to come into force. But no sooner was the scheme voted down – forcing the collapse of the government – that it was announced that there would be another vote.

The EU has form. When it comes to matters European, if a country dares to vote the “wrong” way, it is inevitably asked to vote again until it comes up with the “right” answer. A few years ago, the French and Dutch voted in referendums to reject the European constitution – but the result was ignored, with the new Lisbon treaty, which retained the constitution’s key features, later being slipped through without a referendum, and European integration continuing uninterrupted, making a mockery of democracy. To add insult to injury, the Irish voted no to Lisbon in 2008 – only to be told to vote again. As a result of a series of threats and bribes, they changed their minds the following year. History was merely repeating itself: in 2001, the Irish rejected Europe’s Nice Treaty – it took a second referendum until they made the politically-correct choice.

The markets will hope that Slovakia’s parliament changes its mind. It probably will and the EFSF expansion will proceed as planned. But no system can survive if it is sufficiently hated or despised by most of the population. Those who believe that the Eurozone needs to push through radical fiscal integration and federalise vast amounts of sovereign debt are playing with fire. Voters in Germany will be extremely angry to have to pay higher taxes – and those in Greece will be extremely angry to have lost their independence. America’s Tarp bailouts helped launch the Tea Party (which wants more capitalism and fewer bailouts) as well as Occupy Wall Street (which wants less capitalism and fewer bailouts) – one on the right, the other on the left. These protest movements are having a huge influence in the US. The Eurozone’s looming bailouts will provide short-term relief – but the political backlash they will eventually guarantee will be devastating.

BLACKBERRY CRUMBLE
What’s wrong with BlackBerry? I am a heavy user, a genuine addict, which means that I – together with millions of others – have been hugely inconvenienced by the system’s collapse during the past two days. To add insult to injury, it came back up on Monday night, just to implode again yesterday. Instead of pro-actively explaining what was happening, BlackBerry’s owners, Research in Motion, waited for hours before issuing a statement; for a company that makes mobile phones, its inability to communicate with its users has been astonishing to behold.

As it happens, I also have an iPhone, so I have been able to partly circumvent the debilitating email blackout caused by BlackBerry’s incompetence. We can all put up with minor problems caused by technological glitches; all networks will, at times, fail. But the extent and duration of BlackBerry’s woes and its non-existent PR effort have been beyond the pale. Until the current nightmare, I thought BlackBerry may still be able to survive the onslaught from Apple and the Android phones. I have changed my mind – Research in Motions’ days as an independent company must surely now be numbered.

allister.heath@cityam.com
Follow me on twitter: @allisterheath