The European Commission is to set out next Wednesday its plans for creating a permanent bail-out fund for eurozone states, officials in Brussels confirmed Friday.
The eurozone has been shaken to the core by Greece’s financial meltdown, which forced it to stump up an emergency 110-billion-euro rescue loan. The euro’s original rules were meant to ensure that such rescues were never needed.
The fund would be designed to bail out eurozone states which are threatened with bankruptcy. However, the proposals would have to be approved by those EU member states in the Eurozone and the European Parliament which represents ALL member states, and it could be amended in the process.
I wonder whether those Eurozone states are happy that representatives of non Eurozone states in the European Parliament can pass or amend laws burdening only their taxpayers.
The proposal is set to be part of a package of measures designed to improve economic coordination and policing between eurozone states, after Greece for years ignored the zone’s rules and lied about its figures. Some diplomats say that eurozone states were aware of the problems, but preferred not to react to them.
Now they will have their rules reinforced by countries not tied to the Euro. I wonder if those Eurozone states will react in much the same way that the English do to the West Lothian problem.