Skip to comments.EU budget talks collapse following rows over funding increase
Posted on 11/10/2012 8:32:52 PM PST by bruinbirdman
Talks to agree the European Union's budget for next year broke down amid rows involving among member states including Britain sparking a new funding crisis.
Eight hours of negotiations in Brussels ended in walkouts after MEPs refused to drop demands for an extra £13.8 billion in European Union spending for this year and 2013.
The failure of the talks casts a fresh doubt on whether a major summit to agree to the EU's future funding from 2014 to 2020, scheduled for later this month, can go ahead.
There had already been speculation that the summit would be cancelled because David Cameron was refusing to drop his threat of using Britain's veto to block any future increase above the level of inflation.
Friday night's deadlock was over demands by the European Commission for a £7.3 billion spending increase by the end of this year to meet a funding shortfall, figures that are disputed by Britain and other governments.
At the same time, the European Parliament wants to reinstate over £6.5 billion in funding that had been cut by governments from next year's budget to reflect national austerity programmes.
The two demands, for this year and next, would increase Britain's EU contributions by £1.6 billion at a time of deep cuts to public services domestically.
During the acrimonious negotiations, Greg Clark, the Financial Secretary to the Treasury, attacked the commission for asking for extra 9.65 per cent in funding for this year almost 11 months into 2012.
"Europe must practice the fiscal discipline that it demands of member states," he said.
"Ordinary working people, whether in the UK or elsewhere, cannot be asked to pay more to Europe when they are enduring cuts at home.
"We have made it clear that we want to see the annual
(Excerpt) Read more at telegraph.co.uk ...
They need to starve the best too, same as us
With the re-election of Obama and the general collapse of world governments because of financial difficulties ... world wide depression is in our near future. Prepare as best you can.
The last depression (1929) was not worldwide, this one will be.
Git yer orders in before the market opens if you possibly can so you can git mo!!!
Maybe it is better Obama and Dems are in charge when the SHTF. The problem is many of the EU bonds were brought by leveraging and insured by derivatives. Thus a country like Greece cannot default without Wall Street banks being destroyed by the leveraged bets they placed in London (US investment bankers use their London branches to bypass US leverage limits. In London the sky is the limit. Read about MF Global). EU is running out of money.
Japan is the other nation no one is paying attention to. Many QE proponents point out how Japan uses QE and has not fallen apart. These proponents do not seem to understand that Japan enter their recession with a trade surplus, gov surplus, and Japanese have high savings rate (which is used to buy Japanese T Bills). Ninety percent of Japanese T Bills are purchased by their own citizens. The US is the opposite. Japan is starting to have problems. She is having trade deficits for the first time, her aging population has no more savings left to buy Japanese T Bills, and her gov is piling on debt for nearly two decades. Japan will probably implode before the EU. Problem for US is Japan today is the largest buyer of US T Bills. China used to be the largest buyer but is slowly slinking away from the role.
IMHO short of nuclear war, Japan probably will be the epicenter of the next financial meltdown. This global currency printing by the US, EU and Japan cannot be sustain forever. Most experts see the system falling apart by 2015. Japan has been QEing the longest surviving by trade surpluses and Japanese citizens buying their T bills. That is all running out. Obama will be on deck when the SHTF.
The largest buyer of T bills is the Fed....