Western European News Digest
Tremonti: Global Chapter 11; New Bretton Woods
Jan. 21 (EIRNS)In a Jan. 17 interview with Italy's financial daily Il Sole 24 Ore, Italian Economy Minister Giulio Tremonti counterposed his idea of a Chapter 11 bankruptcy procedure for the financial system, and of a "New Bretton Woods and Global Legal Standard," to the financial bailout, and expressed his regret that the latter has prevailed so far. U.S. Treasury Secretary Tim Geithner, according to Tremonti, rejected the idea of an international treaty, because it would require "too long" a procedure.
Asked whether the public bank bailout had been the correct policy, Tremonti answered: "History will tell.... An alternative was surely Chapter 11: Save that part of finance which is connected to real economy, to [industrial] firms and families, and let rotten assets rot. Frankly, I have thought and written that this hypothesis should be discussed.... Two ideas faced one another: the political idea of a New Bretton Woods and of legal standards, against the technical idea of the forums and the boards [a reference to the Global Stability Forum, which became the Global Stability Boarded].
Tremonti also defended the choice of his government not to have "social slaughter by cutting health care," and called for Europe to move away from the Lisbon agenda, towards a Euratom-like approach (Euratom was the agreement for joint development of nuclear energy among France, Germany, Italy, and the Benelux countries, in the early post-war period).
France Considers Cutting Back TGV High-Speed Rail
PARIS, Jan. 19 (EIRNS)The French National Railroad Company SNCF is considering reducing the frequency of several high-speed rail connections considered "unprofitable."
Under attack: four region-to-region TGV rail lines: those connecting Nantes and Bordeaux, via Paris, with Strasbourg; Paris with Arras; and Lille, via Paris, with Strasbourg. High-speed rail has become, increasingly, the SNCF's "chicken that laid the golden egg," and was mainly developed to attract air travellersmostly to bring in the cash flow. With that financial orientation, TGV development took place at the expense of investment in the rest of the national rail grid. Today, under crisis conditions and the dictatorship of lunatic accountants, SNCF, seeing profits from interregional lines dropping from 20.1% in 2009 to an anticipated 10.2% this year, is considering reducing service on these "unprofitable" rail connections. An additional "problem": Because of people economizing by reducing travel altogether, SNCF now finds itself with "too many trains"!
Traffic is anticipated to fall another 3.6% this year, and, since profitability estimates are based on the number of users, the service along additional lines might also be reduced.
Alone in Europe: Italian Nuclear Progresses
Jan. 20 (EIRNS)Another step towards the revival of a nuclear sector in Italy was made yesterday at a supply-chain meeting of about 600 industrial firms, called on by the electricity company ENEL and the industry confederation, Confindustria. ENEL CEO Fulvio Conti and Confindustria head Emma Marcegaglia called on industrialists to unite in supporting the government program to build four nuclear plants, and called on the government to guarantee no changes in the program and rules. In particular, Conti asked that energy policy, which has been "regionalized" in the past, be put again under the central government, through a Constitutional change.
The four nuclear plants will cost EU16-18 billion; Italy will buy French technology, but the French Areva will build only the nuclear island, which means 30% of the total plant. The remaining 70% will be built by Italian firms, Conti said, and this means billions of euros in orders, production, and employment. Meanwhile, the Gas and Electricity Authority has made it known that in 2010, Italian families will pay EU3 billion in subsidies for "renewable" energies. That figure will increase to EU5 billion in 2015, and to EU7 billion in 2020. Such subsidies are paid as a percentage of the family electricity bill, so that a large, but poor family, pays more than a rich, but small one. The authority called for removing the subsidy from the electricity bill and putting it in a general chapter of the state budget.
A Bad Week for Tony Blair
Jan. 23 (EIRNS)The revelations out of the Chilcot Commission's inquiry, this week, into how Britain got into the Iraq War were, perhaps, best summed up by Britain's Daily Mail, which commented on Jan. 20: "The questioning may be gentlemanly to the point of docility, but piece by piece, Sir John Chilcot's inquiry into the Iraq war is building up an immensely powerful case against Tony Blair." This week's testimony saw former Defence Minister Geoff Hoon blame Blair for the fact that British troops went into combat with insufficient quantities of body armor and other equipment, and former Foreign Secretary Jack Straw practically admitting that the invasion was a mistake, and that he had privately advised Blair that it was "unlawful."
Now that the Dutch Davids Commission report (see this week's InDepth) declared that the Iraq war violated international law, certain Brits are trying to come clean at the expense of Blair. The Guardian reports that Blair's Foreign Secretary in 2002, Jack Straw, sent a letter that same year to Blair, marked "secret and personal," warning of the "dubious" legality of a war. This letter was given to Blair ten days before Blair met George W. Bush at the U.S. President's ranch in Crawford, Texas, in April 2002, nearly a year before the invasion.
'Clandestine Rationing' of Health Care in Germany
Jan. 18 (EIRNS)Calls for rationing health care in Germany were issued over the past few days. Health economist Friedrich Breyer of the University of Constance is quoted in the Jan. 17 Frankfurter Allgemeine Zeitung insisting that "the discussion about rationing in the health system has to be conducted now," because economic growth is on the decline and people are living longer. "We cannot keep financing the growth in medical knowledge and expenses any longer by our growing economy," he argued. The Cologne-based medical ethics expert Christiane Woopen, a member of the governmental ethics council, complained that it "is taboo in Germany [to discuss] which illnesses are to be treated and with what priority."
Even Jörg-Dietrich Hoppe, president of the German Medical Association, seemed to blow into the same horn, saying in the same FAZ report that, under their increasing budgetary restraints, hospitals are deciding arbitrarily which cancer patients, for example, get what treatment, so that many patients do not get the appropriate cancer therapy, but the inexpensive therapy. Hoppe charged that "clandestine rationing" was taking place already on a large scale, leaving the burden of decision-making on the shoulders of the medical staff. Hoppe entered dangerous territory then, calling on politicians to define criteria for what treatment for which illnesses should receive priority, and which should not. These politicians are running into a scissors crisis between sinking tax revenues and the obligation to balance the budget. Such politicians will look for opportunities to impose brutal budget cuts somewhere, and health care is a favored target.