Now that the Greeks have voted to bankrupt themselves (blaming everyone else in the process), it is duly time to take another look at the part I touched on in my article ‘Dress rehearsal (part 1)’ on July 1st 2015 (at https://lawlordtobe.com/2015/07/01/dress-rehearsal-part-1/). There the issue that came from Danuta Hübner, Chair of the Committee on Constitutional Affairs, European Parliament, with the attachment I added in the paper by Phoebus Athanassiou ‘Withdrawal and expulsion from the EU and EMU‘
Danuta Hübner mentions Art. 50 of the Lisbon Treaty as well as Art. 140 Treaty on the Functioning of the European Union (TFEU). So, this is something we need to look at, because Greece has decided not to be responsible and before the papers and TV drown us in emotional issues, whilst keeping quiet that the debt of other European nations might go up and not by a small amount.
So, yes, basically article 50 is about ‘withdraw from the Union in accordance with its own constitutional requirements‘, which does not mean the others can throw Greece out.
So far, that part seems almost impossible, as Tsipras keeps on claiming wanting to remain in the Eurozone, the image given is that he would stay in because article 50 is all about voluntarily removing one’s self from the Euro. Article 7(1) gives us “On a reasoned proposal by one third of the Member States, by the European Parliament or by the European Commission, the Council, acting by a majority of four fifths of its members after obtaining the consent of the European Parliament, may determine that there is a clear risk of a serious breach by a Member State of the values referred to in Article 2“, which leads to Article 7(3) “Where a determination under paragraph 2 has been made, the Council, acting by a qualified majority, may decide to suspend certain of the rights deriving from the application of the Treaties to the Member State in question, including the voting rights of the representative of the government of that Member State in the Council”
In short, Article 7 is about reprimanding, even if all rights are suspended. That does not mean that they exit, which gives us two parts, the fact that France can walk away from the Euro to protect itself, yet Greece cannot get removed, which is not a given yet, there is a lot more to sift through. Article 2 is all about values, respect from Human rights and the rights of minorities, which does not have bearing on this precise case. The PDF that brought this to light, which by the way (due to an error on my side) is from Phoebus Athanassiou, my apologies for the earlier mistake in my previous blog!
“The idea that the treaties should explicitly provide for a possibility of expulsion was discussed in the 2001-2003 Intergovernmental Conference responsible for drafting the ill-fated Constitutional Treaty, but was abandoned“, so not only were politicians the start of the mess, yet NO ONE had the bright idea to consider that one player might not be an adult giving them all permanent headaches is beyond hilarious, the fact that this legal bright mind (trained in the UK) is also a former Lawyer connected to Athens Law Firm of Tsibanoulis & Partners, and a former consultant for Government of the Republic of Cyprus just adds to the humour. His paper from 2009 and now we are all about to learn how we wasted millions on representations from the ECB whilst they were unable (as it seems) to properly protect the members. In all this both Yanis Varoufakis and Alexis Tsipras must be howling with laughter as we learn that most papers had not even clearly investigated the marketing term Grexit, so even as Brexit and Frexit might become reality in voluntary secession, Grexit will not happen against the will of Greece, as the facts presently are given, but let’s take a look at the steps that come next, because the PDF I added on July 1st is truly a treasure trove (Phoebus Athanassiou seems to be hindered by extreme levels of brilliance).
There is however another consideration, if we look at Article 2, where we see “The Union is founded on the values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of persons belonging to minorities“, the question becomes, as Greece decided to ignore equality and rule of law, are they in violation of Article 2?
Consider, that the creditors are a factual minority (one set on wealth and power of decision), the Greek government took out loans, they signed of these loans, as they are not complying with the execution of the agreed terms, are they not breaking the law? In addition, Article 3(2) gives us “The Union shall offer its citizens an area of freedom, security and justice without internal frontiers, in which the free movement of persons is ensured in conjunction with appropriate measures with respect to external border controls, asylum, immigration and the prevention and combating of crime”
It is the part ‘prevention and combating of crime‘, so as we see that for decades Greece did not ‘uphold’ (read reform) taxation laws or properly prosecute tax evaders (one fined Bobolas ‘proper’ combatting tax evasion does not make), can we state that Greece is in violation in accepting the articles of the Union, as such, what could be made then?
I will be the first to admit that this is a mighty fine line, but in this game, could such a fine line be enough?
Article 3(3) is about several things, including cohesion, Economic, social and territorial. When we consider the economic part we get the thought that economic and social cohesion is an expression of solidarity between the Member States and regions of the European Union. This means balanced and sustainable development, reducing structural disparities between regions and countries and promoting equal opportunities for all individuals. The fact that Greece (one of many) has not been able to (or intentionally unwilling) to keep a proper budget, we get an unbalanced and unsustainable development, whilst these people (the previous administrations) have not been properly investigated or even prosecuted, which gives us possible transgressions of Articles 2, Article 3(2) and Article 3(3). So is expulsion still not an option in that hindsight?
So as we see that the makers of the articles painted themselves in a corner by only focussing on growth and ignoring accountability, we see that Greece either got really well informed, or just had the right page open on the right day, no matter what, the EEC is inheriting a mess it did not properly defend itself against, so even though the path was reached in another way, as we see this explode, it seems very conceivable that the fallout from this event will have a large impact on the chances of Brexit and Frexit as they will be voluntary. So even as the UN was bright enough to include their Article 6, where the member can send home in a not so nice way for ‘persistently infringing the principles of the Charter‘, it becomes clear that the overpaid makers of Treaty of Lisbon were a lot less clued in at this point (or so it seems).
As I see it, Dr Phoebus Athanassiou, Senior Legal Counsel with the DGLS of the European Central Bank (ECB) had nailed the issue fair and square in 2009, I am just appalled that journalists and politicians have either ignored the options, or intentionally misinformed the people, whilst the European member politicians had their ‘closed door‘ meeting.
As I stated on July 1st: “Consider the next news “Here’s Bloomberg on Schaeuble’s comments: German Finance Minister Wolfgang Schaeuble told lawmakers in Berlin that Greece would stay in the euro for the time being if Greek voters reject austerity in a referendum scheduled this week, according to three people present. Schaeuble also said the European Central Bank would do what’s needed to protect the euro if Greeks voted against the bailout terms in the July 5 referendum, according to the people, all of whom participated in the closed-door meeting on Tuesday“, is that why it was closed door? The fact that expulsion is pretty much impossible?
So as we now see “Angela Merkel, is to head to Paris on Monday for urgent talks with French president François Hollande over how to avert a growing Eurozone debt crisis” (at http://www.theguardian.com/world/2015/jul/05/germany-greek-referendum-anger-solidarity), which signals two things, the first is that Germany is not considering steps that will accelerate many things, pat of it will make Greece the pariah it should not have made itself, you see, the BBC and the Guardian are all about ‘negotiations’ and the, as we might regard it hollow statement from EU Parliamentarian Martin Schulz “he hopes that meaningful proposals from the Greek government will arrive in the coming hours because “if not, we are entering a very difficult and even dramatic time.”“, is that so? Because Greece can only leave the Euro voluntarily as we see it at present. Another voice, which is the Economic editor Robert Preston gives us even more to worry about. “The Bank of Greece could make unsecured loans to Greek banks without the ECB’s permission“, which could blow the Euro straight into the basement value, as well as “Or it can explicitly create a new currency, a new drachma, which it could then use to provide vital finance to Greek banks and the Greek economy“, which might be more likely, but does Greece have to go either way? Consider that the lacking law makers forgot to properly defend itself, now take into account that when Tsipras will let it all fall and food and medication are no longer an option, we get back to Article 2 of the Lisbon Treaty with “The Union is founded on the values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of persons belonging to minorities“, which means that the other EEC nations would have to foot the bill and come to the aid of Greece to deliver food and medication. All this because previous Greek elected officials refused to adhere to Article 3(2) regarding ‘prevention and combating of crime‘ (tax crime to be exact), as well as the economic cohesion thing, but the last one is one that pretty much NONE of the EEC members adhered too, so calling Greece on that seems slightly hypocritical from my side.
So as the creditors might resort to “Qu’ils mangent de la brioche” (let them eat cake), we see a dangerous escalation. I wonder how both Nigel Farage and Marine Le Pen will respond in the coming days. There is no doubt in my mind that this will impact Brexit and Grexit, especially as it will be voluntarily.
No matter how this plays, we already seeing images on how Greek retirees are getting hit all over the place. So as we see Tsipras playing ‘paper tiger’ stating “the vote showed that “democracy won’t be blackmailed””, my less ‘diplomatic’ quote would be: “No, you blistering idiot, you sitting on your hands and not seriously reforming taxation and prosecution laws is part of the direct reason of the mess we now see!” This is why we will now see articles like http://www.thenational.ae/world/europe/crying-greek-pensioner-the-story-behind-the-heartbreaking-photo, ‘Crying Greek pensioner’. Here we now see quotes like “I see my fellow citizens begging for a few cents to buy bread. I see more and more suicides. I am a sensitive person. I cannot stand to see my country in this situation.” And this is not even close to the tip of iceberg.
The next few days will be interesting to say the least.