The countries of the eurozone have lost a considerable part of the national sovereignty, having refused the primordial monetary units, having replaced them with euro. Soon 20 years from the moment of the birth on light of new currency will be executed – euro. It is regional supranational currency of a number of the European countries.
The monetary unit euro has been introduced into non-cash circulation on January 1, 1999, and the corresponding banknotes and coins have been introduced on January 1, 2002 into cash circulation. Today euro – official currency of 19 countries of Europe forming the eurozone (Austria, Belgium, Germany, Greece, Ireland, Spain, Italy, Cyprus, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia, Finland, France, Estonia).
Euro is also national currency of 9 more small states and jurisdictions, 7 of which are located in Europe (Andorra, Vatican, Monaco, etc.). Literally from the moment of the birth the new currency which has become the successor of DM, French franc, Italian lira and some other the European monetary units has borrowed and continues to keep surely the second place in the world of money after US dollar.
So, at the end of the third quarter of last year the US dollar share in official currency reserves of member countries of the IMF has made 63,5%. The share of euro was equal to 20%. For comparison: only 1,12% were the share of the Chinese yuan, despite great efforts of Beijing on his internationalization.
Even more than euro ranks high in international payments. So, according to SWIFT, at the end of last year the dollar share in international payments made 39,3%, and euro - 32,62% (further followed the British pound from shares of 7,42%, the Japanese yen from 2,94% and the Chinese yuan from 1,75%).
The countries of the eurozone have lost a considerable part of the national sovereignty for the reason that have refused the primordial monetary units, having replaced them with the supranational currency called by euro. It is well known that national currency – the major sign and attribute of sovereignty. Also it is not about symbolical things at all – such as coat of arms and other national symbolics which are represented on coins and banknotes. It is that, emitting national currency, the state controls national economy.
First, the state determines the volume of the money supply serving turnover of goods, services and financial instruments in the country. Secondly, it can define to whom to transfer this money (modern money is included in the address in type of loan, provided to commercial banks, or loans to treasury and other state organizations).
The refusal of the state of national currency means refusal of issue function, and the refusal of issue function means refusal of the state of management of economy and the country in favor of that center which releases that currency which addresses in this country. The countries which have entered the eurozone have refused opportunities to operate the economies in favor of the European Central Bank which is releasing euro and being supranational institute. And such institute which is actually not under control to member countries of the eurozone.
It is known that today almost all Central Banks in the world have the special status allowing them to work irrespective of the governments and other public authorities. The ECB owing to the supranational status has such independence "in a square", the national Central Banks can envy it.
In a word, today 19 states entering the eurozone actually are operated by the European Central Bank. And here by whom the ECB - a big question is operated. Formally the most important decisions are made by the ECB Governing Council in which heads of the Central Bank of member countries are presented. But, as we have already told, appointments of heads of the national Central Banks are carried out on the basis of very "muddy" procedures which you won't call democratic in any way.
Besides so-called "national" the Central Bank in the eurozone have actually turned into regional branches of the European Central Bank and perform mainly technical functions. On economy write in modern European textbooks that the European Central Bank the Central Banks of member countries of the eurozone allegedly operate. Actually all exactly the opposite: The ECB operates the Central Banks of member countries, having turned into the branches. It turns out that "not the dog twirls by a tail, and the tail twirls by a dog".
Since November 1, 2011 the president (the highest official) of the ECB is Italian Mario Draghi. He has an impressive track record: the executive director of the World Bank, the chairman of the board on financial stability (works under the auspices of Bank for International Settlements), the managing director of the Central Bank of Italy (Banca d’Italia). But, perhaps, the most important place of his last work – the American bank Goldman Sachs where he held a position of the executive director.
Being formal the Italian, Mario Draghi is very closely connected with transatlantic bankers. Recently, by the way, the scandal connected with the fact that the current president of the ECB is a member of "group 30" (G30) which is called confidential "club of world bankers" has burst. The ombudsman of the EU Emily O'Reilly (under pressure of public organizations of Europe) at the beginning of this year has urged Mario Draghi to stop participation in G30. The lady has noted that representatives of a number of large banks which are directly or indirectly controlled by the ECB enter G30. Thereby the confidence to the ECB as to "independent" institute is undermined.
By the way, it was already the second attempt (the first has been undertaken in 2014) to force the president of the ECB to adhere to the charter of this organization forbidding the "opaque" contacts of this sort generating "the conflicts of interests". Mario Draghi has ignored these appeals.
Italy – one of the first countries of the eurozone where the ideas of return to national currency began to arise. First some Italian politicians and economists didn't make radical demands of an exit from the eurozone and full refusal of euro. The project of issuance with euro so-called "fiscal money" was discussed. It is considered that the idea of such money goes back to the German political house-keeper Georg Friedrich Knapp who in the 20th years of the last century has developed the "hartalny" theory of money (the name comes from Latin "charta" — the sheet of paper).
Usually pay attention to that part of the theory of the German in which he proves uselessness of gold providing money. In it Knapp is conformable with the Russian economist Sergey Sharapov who at the end of the 19th century has written work "Paper ruble" (I opposed gold ruble) and the English economist John Keynes ("The treatise about money", 1931). But present Italians in Knapp's work were interested in another: namely the fact that not only the Central Bank, but also treasury can emit and withdraw money from circulation. The idea is quite sensible, but tabooed understandably: treasury money undermines monopoly of the Central Banks belonging to usurers and serving their interests.
But what the Italian politicians and economists have offered under the name of fiscal money usual treasury money aren't. It is about government bonds which from the legallistic point of view it is impossible to call lawful means of payment. But at the same time the state can use them for purchases of goods and services, financing of investment projects and is ready to accept for payment of taxes and payment of government services.
Besides, the state won't make difficulties to business and citizens if they want to use these bonds as means of payment and exchange among themselves. Supporters of introduction of parallel fiscal money expect that they will be able to recover national economy due to stimulation of investments and demand which after financial crisis of 2007-2009 have begun to contract sharply. The volume of issue of fiscal money varies depending on an economic environment. During the safe periods of time their release can stop in general. No coupon payments on such bonds are made.
The idea of introduction of fiscal money have supported all main opposition parties though in their offers there were nuances. Berlusconi's party Forza Italia called such money fiscal credit certificates (CCF). CCF officially aren't a government debt and don't increase the sum of the Italian national debt. Certificates can address within two years in economy as a means of exchanging and payment, and at the end of the specified term are repaid by payment of taxes by their last holder.
And here the North League party called fiscal money miniboats. It is offered to use them in the address in the form of paper signs of the same format, as well as euro. They will be given by the state to business and the natural persons having the right for fiscal privileges. Can be used for payment of taxes and services of the state enterprises.
The Five Star Movement suggests to introduce fiscal money into circulation in the form of electronic plastic cards. Their repayment in the form of payment of taxes can happen at any time (it isn't necessary to wait, for example, for the expiration of two-year term, as in case of CCF).
The Italian and foreign experts claim that the release of fiscal money doesn't violate the law of either Italy, or the European Union. However European officials are suspicious of the project of introduction of such parallel money, not unreasonably being afraid that they will undermine monopoly of euro and the European Central Bank.
However the ideas of introduction of parallel fiscal money were on the agenda of political life of Italy only prior to the last parliamentary elections in March of this year. After success on elections of parties of eurosceptics – Five Star Movement and North League - requirements of many Italian politicians became more radical. They began to demand a full exit of Italy from the eurozone and return to national currency – lira. There were many articles and the analytical materials proving that the entry of Italy into the eurozone has led to deterioration in a social and economic situation in the country.
The American economist Nuriel Rubini considers that if Greece, Portugal and Italy leave the eurozone, they will be able to leave a long-term economic depression and political instability. Yes, some losses of GDP of these states because of refusal of euro are first possible, but they more than are compensated by the economic growth which will amplify after introduction of national currencies. Today in Italy have even remembered already died Milton Friedman, the founder of modern monetarism. At the end of the last century on the eve of introduction of euro he predicted that the probability of disintegration of the European integration Union founded on single currency is equal to 99%.
In 2015 Greece has appeared in the hardest financial crisis, in one step from a large-scale default on a sovereign debt. Three years ago Greece was already ready to leave the eurozone, to refuse euro and to return to the drachma. Only at the last minute Brussels together with the International Monetary Fund managed to agree with Athens. The program of rescue for the total amount of 86 billion euros has been offered Greece (till August, 2018). Appeals of the Greek politicians and economists to return to drachma have calmed down. But I think that after end of the aid program at the end of this year in Greece can start talking about an exit from the eurozone again.
It is necessary to tell, as in more safe, than Italy and Greece the countries, also amplify moods in favor of refusal of euro. The leader of National Front Marine Le Pen during the election campaign at the beginning of 2017 expressed the need of an exit of France from the eurozone more than once, calling single European currency "a live corpse" and "the political tool of the EU".
One more country – Netherlands. It can be carried to a so-called "kernel of the eurozone". And, nevertheless, for all became surprise that at the beginning of last year the parliament of this country has made the decision to check as far as win or, on the contrary, lose the Netherlands from the all-European currency – euro. Dutches gradually lose confidence that they benefit from euro: finally, in rather safe countries of the eurozone investors well know that percent which they would have to receive on the capitals, but which because of policy of the ECB they don't receive go for support of bankrupt economies of the EU: Greece, Italy, Spain, Portugal and Cyprus.
Also all Dutch taxpayers lose: The Netherlands is forced to participate in crediting of the called problem countries. It is demanded by Brussels and Berlin though all well know that the issued credits Greece and similar never will give the country to it back any more. Actually it turns out that Dutch (and also German, Luxembourg, Finnish, etc.) taxpayers pay taxes also for needs of other countries.
The deaf discontent with the European integration based on single currency is shown also by Germans. Though the leading German and European media prefer not to advertize it. Even in the fall of 2011 in Germany survey according to which nearly 50% of the interviewed Germans have supported refusal of euro and return of DM has been conducted.
Some small European countries which after disintegration of the socialist camp became members of the European Union have hurried to enter the eurozone at once. It is Slovenia, Slovakia and also Estonia. In the 1990s moods to enter the eurozone and at Poland and the Czech Republic were strong. Terms of such occurrence were several times postponed. However today in the specified two countries the former thirst for euro completely has evaporated.
In the last days of May of this year (i.e. last week) sharp falling of euro exchange rate in relation to US dollar has begun. It is caused by the political crisis which has broken out in Italy. On May 29 the famous billionaire George Soros (probably, under the influence of events in Italy) has said that Europe is waited in the nearest future by the most severe financial crisis.
I think, this summer can become the heaviest and intense for European officials. However, as well as for many ordinary Europeans and the European business. Eurosceptics in Italy have received a majority of votes on the elections which have taken place in March. On May 31 after the long political crisis it was succeeded to create the coalition government which will realize the program from 30 points. The program provides forming of the new relations of Rome with Brussels. The new government intends to show to the European Union conditions of preservation of the membership in the EU and the eurozone.
First, to write off a debt of Italy to the European Central Bank for the sum of 250 billion euros (nearly 300 billion dollars). Secondly, to cancel standards of the Maastricht Treaty of 1992 (extreme values of a sovereign debt, size of budget deficit, interest rates for a debt, etc.) for Italy. Actually it is the ultimatum Rima Bryusselyu. Brussels has two options of behavior in this situation: to agree with the ultimatum of the Italian eurosceptics or to refuse Rima.
It is hard to say what option it is necessary to call bad and what - absolutely bad for euro and the eurozone. There is a strong suspicion that at the end of this year the building of currency integration of Europe will begin to be unsteady strongly. And in the following there can be his final collapse. By the way, George Soros mentioned by me in the performance on an occasion of the future financial crisis in Europe has advised member countries of the eurozone to come back to national currencies, and Brussels – not to interfere with them in it. If such council proceeds from lips of the experienced mondialist, so really, in uniform Europe "it smells of trouble".