European bureaucrats take a haircut after budgetary negotiations

By LUIS MIRANDA | THE REAL AGENDA | FEBRUARY 11, 2013

European officials are preparing to apply extreme cuts to their budgets beginning next year. The budget negotiations held last week resulted in a reduction in administrative costs, slightly more than the latest estimates, although lower than what had been proposed by British Prime Minister, David Cameron.

Budgetary cuts only include a cut of 2,500 million euros compared to the initial scenario envisaged by the European Commission. This reflects the lack of agreement among members and the realization that cutting any further would have left the EU with even more unhappy bureaucrats. The 2.5 billion cut is peanuts when compared to the 1 billion euros.

The Commission is upset with the prominence acquired by the cuts during the debate and warns that it will be difficult to take on more responsibilities and welcome new countries in the EU family.

What European negotiators had no trouble agreeing on was on the maintenance of the 61.629 million euros budget dedicated to the administration of the European institutions, which represent an advance of nearly 8% over the current budget framework.

Much of that budget is used to pay fat retirement packages to European bureaucrats which is the reason why the Commission will begin to implement its own austerity plan, which has been taken by European leaders and agreed with Parliament.

Those supposed austerity measures will represent a 5% cut in public employment until 2017, representing 2,500 jobs lost through that will not be replaced. In addition, staff working 40 hours a week, will retire at age 65 — now can do it at 63 — and the so called solidarity tax will grow to 6% of the workers’ salaries.

In addition, the lowest wages and the highest among the administrative staff will fall between 20% and 45%. And there will be more possibilities of temporary contracts. Finally, annual travel will be restricted.

With the wave of austerity sweeping across Europe, these measures still leave Europe’s 55,000 public employees well above average, with  salaries ranging from 2,000 to 16,000 per month –. The comparison is less favorable if the riches in Europe are taken into consideration, who will obviously not seek work in Brussels.

But that will not be enough to accommodate the numbers agreed. So the Commission explores other hypotheses. One of them is to lower the bill of translation, which absorbs 15% of the EU administrative expenditure. It also proposes to reduce (or eliminate) the maintenance of national experts who travel to the EU capital, so that each country pays for their own. None of this measures will make any significant changes to the European budget, though. They are simply petty decisions made in an attempt to show willingness to cut, but not much as needed or on the matters that really need to be slashed.

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Cap and Trade: Polluting is allowed so long you pay the banksters

Kerry and Lieberman want the industry to pay bankers a fee for emitting.  In other words, they want to legalize unlimited pollution.  The results will be an end to industry at the local and regional levels, with massive, worse than ever before emission for anyone who can pay the new tax (Transnational Corporations).  The bill presented in May will also regulate how much energy citizens can use. It will also pursue the same failed green policies Spain is now abandoning.

CNSNews

Senators John Kerry (D-Mass.) and Joe Lieberman (I-Conn.) said they are not worried that their cap-and-trade plan might harm

The Cap-and-Trade scheme is part of the largest transfer of money and resources from the poor and the middle class to the corporate Lords.

fellow Democrats going into the November elections, at a time when voters are more concerned about bread and butter issues such as the economy and the 9.7 percent unemployment rate.

The bill, the American Power Act,  was unveiled in May and would establish a nationwide cap-and-trade system that would regulate the amount of carbon dioxide emitted into the atmosphere. In exchange, the bill would also extend various tax subsidies and credits in an attempt to make renewable energy sources relatively affordable.

Cap and trade basically means that a ceiling, a cap, would be placed on certain carbon-emitting manufacturers who would be allowed to exceed that cap if they purchase carbon credits (trade), the proceeds of which would be invested in alternative energy after the government collected a portion of those proceeds. (Some analysts describe the plan as “cap and tax.”)

CNSNews.com on Tuesday asked Sens. Kerry and Lieberman whether they were concerned that pushing such a low-priority issue so close to an election would reinforce the perception that Congress and its Democratic leaders were out of touch with the American people. (Lieberman, though an Independent, is a former Democrat who now caucuses with the Democrats in Congress.)

Lieberman acknowledged that the public is concerned with fiscal issues: “Deficit, debt is on the minds of the voters,” he said. “The American Power Act has been constructed to be deficit-neutral [and] we’re going to get the CBO analysis later this month or early next month.”

Kerry went on at length, saying that  Americans support many of the provisions in his bill: “When you put the worst arguments characterizing our legislation against the best arguments for energy independence — for jobs, for health, and cleaning up the environment — overwhelmingly Americans land on the side of a comprehensive bill,” said Kerry.

Kerry said that the debate going forward will not be about convincing the public of the veracity of global warming claims, but about trying to redefine cap and trade legislation as something that will benefit the struggling economy.

“Nothing that we do with respect to this bill rides on persuading people ultimately about climate [change],” Kerry said.

“Do Americans want to say no to anywhere from 250,000 to 540,000 jobs a year for the next 10-20 years? I don’t think so,” said Kerry.  “Do Americans want to let China take the lead in solar and wind technologies that we invented? I don’t think so. This is about getting America into the marketplace. This is a $6 trillion market with 6 billion potential users.”

Kerry and Lieberman, in an apparent nod to voters’ fiscal concerns, may have a steep hill to climb in convincing the public that their economic plan will lead to a better economy.

Polls show that Americans are not particularly taken with the issue of global warming, the driving force behind the Kerry-Lieberman effort. A March 2010 Gallup survey, for example, found that 48 percent of Americans thought that global warming claims were exaggerated.

That same survey found that 67 percent of Americans thought that global warming would not pose a serious threat to their well-being in the future.

Polls also have shown that global warming does not rank high on Americans’ list of concerns. An April 2010 Gallup survey found that Americans ranked environmental issues and global warming last when asked which issues they thought were the most important in determining how they will vote in November 2010.

Only 46 percent of Americans said that global warming was either “extremely” or “very” important to their voting decisions. By contrast, 93 percent said the economy was either very or extremely important to their voting choices. In fact, the economy was the only issue of the seven polled that a majority of voters, 53 percent, called extremely important to their voting decision.

Global warming was ranked as extremely important by only 22 percent of respondents.

The same March 2010 Gallup survey that showed skepticism of global warming also found that only 30 percent of the public thought that energy and climate legislation would either probably or definitely help the economy. Among those, only six percent thought federal legislation would definitely help.

Conversely, 48 percent thought that federal climate and energy legislation would either definitely or probably hurt the economy. The percentage of Americans who thought that federal energy legislation would either probably or definitely hurt the economy actually rose from one year ago, the survey found, while the number of people who thought the legislation might be beneficial declined.

As Predicted, Spain on the Brink of Collapse

The tentacles of the international banking cartel are about to envelop the fifth most important economy of the old continent

The Independent

European leaders meet in Brussels today amid growing fears that Spain, Europe’s fifth-largest economy, is preparing to ask for a

The horns of the depression are in Spain's rearview mirror. An aid package is in the works to rescue one more failed State.

bailout which would dwarf the €110bn (£90bn) rescue plan for Greece.

The Spanish government yesterday dismissed reports that it was already in discussions with the European Commission, International Monetary Fund and the US Treasury for a rescue package worth up to €250bn.

Officials in Madrid, Brussels and Paris were forced to deny that a Spanish bailout – which would take the European debt and euro crisis into a potentially dangerous new phase – was on the Brussels summit agenda.

“Spain is a country that is solvent, solid and strong, with international credibility,” said its Prime Minister, Jose Luis Rodriguez Zapatero. The European Commission spokesman said: “I can firmly deny [that a Spanish rescue is under discussion]. I can say that that story is rubbish.”

Brussels diplomats have been at pains to send out feel-good signals ahead of a summit in which Europe’s leaders are supposed to take the first steps towards more disciplined and co-ordinated, control of national finances. Those reforms are meant to restore confidence in the euro and underpin the €750m EU and IMF safety-net, created last month for euroland countries that lose the confidence of the financial markets.

However, it is proving hard to shake off persistent market fears about Spain, which, if it needed a lifeline, would swallow up a large part of the emergency fund. Worryingly for the EU, the doubts about Spain – whether real or driven by speculation – are eerily similar to the gradual seeping away of confidence that sent Greece into a financial death spiral in March and April. The Spanish government’s cost of borrowing hit a new record yesterday. The interest rate gap, or spread, between 10-year Spanish bonds and their German equivalents, rose by more than 0.10 of a point to 2.23 percentage points.

A senior Spanish banker, Francisco Gonzalez, chairman of the BBVA financial services group, confirmed that foreign private banks were now refusing to provide liquidity to their Spanish counterparts. “Financial markets have withdrawn their confidence in our country,” he said. “For most Spanish companies and entities, international capital markets are closed.”

As a result, the European Central Bank is said to have provided record amounts of liquidity to Spanish banks in recent days. The closure of bank-to-bank credit to Spanish institutions recalls to some market commentators the ripple of crisis through the global financial system after the fall of Lehman Brothers in the Autumn of 2008.

The IMF chief Dominique Strauss-Kahn is expected in Madrid tomorrow to see Mr Zapatero – but brushed off speculation of a crisis. “It’s a working visit,” he told reporters in Paris. “I am in France [today] – are there such rumours about France?”

Fears over Spain’s finances checked the recovery of the euro on money markets yesterday. The single currency lost much of the gains it had made in the past seven days.

One of the proposals on the table at the Brussels summit is public “stress tests” to force banks to reveal the state of their books. The Spanish government offered yesterday to open the books of its own private banks unilaterally to prove that they were sound.

Today’s summit in Brussels was intended to be a time for the EU leaders to catch their breath and discuss ways of restoring the euro’s long-term credibility. The threatened Spanish crisis may blow all that out of the water.

Despite an apparent rapprochement between Paris and Berlin this week, President Nicolas Sarkozy and Chancellor Angela Merkel remain deeply divided on how to prevent the currency and debt crisis from dumping Europe back into recession. Mr Sarkozy has agreed to drop his proposals for new institutional machinery for a political “government” of the euro by its 16 member states. Ms Merkel prefers to talk of a vague “governance” of the euro, and European state spending, by all 27 EU governments.

More fundamentally, Paris is deeply concerned that the austerity plans announced by Berlin last week could – on top of budget cuts in other countries – plunge Europe into crisis.

The French fears were echoed yesterday by the billionaire investor, George Soros, who warned that Europe would almost certainly face a recession next year which might generate “social unrest” and the kind of populist nationalism seen in the 1930s. “That’s the real danger of the present situation – that by imposing fiscal discipline at a time of insufficient demand and a weak banking system… you are actually… setting in motion a downward spiral,” he said.

The collapse of Spain’s housing boom has helped fuel a deep downturn which has sent unemployment spiralling to 20 per cent, the second worst in the EU. Mr Zapatero introduced a range of measures last month, including spending cuts of €15bn over two years and reductions in public sector wages and spending. Unions have called a general strike over labour reforms.

David Cameron: No More Power to Brussels

Times Online

David Cameron gave a blunt warning to Angela Merkel today that he would veto any attempt to reopen the Lisbon treaty to give the EU more power over national budgets.

Standing alongside the German Chancellor, Mr Cameron insisted that he wanted to see a strong single European currency but pledged to block moves to prop it up that involved a transfer of power from Westminster to Brussels.

The Prime Minister held robust and cordial talks with Mrs Merkel in Berlin where they also disagreed over hedge-fund regulation and Mr Cameron refused to reconsider his decision to pull the Conservatives out of the main centre-Right group in Europe.

The two leaders put on a relaxed show for the cameras, with Mrs Merkel’s mood buoyed by securing a “yes” vote in the German Parliament for the eurozone’s 750 billion euro bailout fund, to which Berlin will contribute up to €147 billion in loan guarantees.

But the convivial atmosphere could not mask their differences, with Germany leading calls at a finance ministers’ meeting in Brussels today for EU treaty changes to help restore confidence in the euro by introducing new sanctions and powers of co-ordination.

“There is no question of agreeing to a treaty that transfers power from Westminster to Brussels. That is set out 100 per cent clearly in the coalition agreement,” Mr Cameron said.

“Britain obviously is not in the euro and Britain is not going to be in the euro, and so Britain would not be agreeing to any agreement or treaty that drew us further into supporting the euro area.”

The Prime Minister added: “It goes without saying that any treaty, even one that just applied to the euro area, needs unanimous agreement of all 27 EU states including the UK, which of course has a veto. I think these are very important points to understand.”

His remarks left open the possibility that the 16 eurozone countries could introduce greater control from Brussels that applied just to them.

Mrs Merkel suggested that she had not given up on her desire to re-open the Lisbon treaty but played down its significance today. “There are certain ideas that Germany has tabled where treaty change plays a role. But this is the beginning. It is very early days as yet,” she said.

She added: “I have made it clear that we need to stabilise the euro but at a later stage we will be able to say what we can do and how should we do it.

“And then we will see what the majority will want and the interests of the eurozone.”

Mr Cameron showed that he had not given up trying to persuade Mrs Merkel to relax tough new proposed EU rules for hedge funds driven by Berlin and Paris.

“We do have our concerns because we do not think actually hedge funds were the cause of the problems in our financial markets and in our economies,” Mr Cameron said.

“We accept the need for regulation but it does need to be fair and proportionate.

“We have a particular issue about hedge funds that are based in other countries but have operations within one EU country and whether they would be able to access the so-called passporting system. So we have concerns; it is still being discussed.”

He refused to be drawn into open criticism of Mrs Merkel’s surprise decision this week to ban certain types of risky trading in shares and bonds, which began a slide of confidence in European shares that continued today.

Mr Cameron said: “Obviously we should respect each other’s decisions on these issues.”

“All I would say is this, and I’m sure there would be agreement on this: what matters is are we dealing with the real causes rather than just the symptoms?

“It seems to me that the cause of many of our problems in the European economies is excessive debt, excessive deficits, financial systems that haven’t worked, banking systems that have ground our economies down.

“Those are the problems. We’ve got to tackle the problems and get to the source of the problems and then actually we’ll find the symptoms will be less of a problem.”

Relations between Mr Cameron and Mrs Merkel were soured by the Conservative pull-out from the centre-Right European group over its support for closer political union in Europe.

Mrs Merkel is understood to have told him that she was saddened by the move which saw the Tories ally themselves with right-wing parties from Poland, the Czech Republic and Latvia.

Peter Ramsauer, the German Transport Minister and old Etonian, who forged links with Mr Cameron through their alma mater, said: “I have tried my very utmost best to try to keep things together. I said ‘David, can you imagine the great British Tories can be a partner of people like Topolánek from the Czech Republic? Never, ever.’ Maybe we can bring them together again. There are lingering hopes very far on the horizon.”

World Health Organization Moving Ahead on Billions in Internet and Other Taxes

Fox News

The World Health Organization (WHO), the United Nations’ public health arm, is moving full speed ahead with a controversial plaWHOn to impose global consumer taxes on such things as Internet activity and everyday financial transactions like paying bills online — while its spending soars and its own financial house is in disarray.

The aim of its taxing plans is to raise “tens of billions” of dollars for WHO that would be used to radically reorganize the research, development, production and distribution of medicines around the world, with greater emphasis on drugs for communicable diseases in poor countries.

The irony is that the WHO push to take a huge bite out of global consumers comes as the organization is having a management crisis of its own, juggling finances, failing to use its current resources efficiently, or keep its costs under control — and it doesn’t expect to show positive results in managing those challenges until a year from now, at the earliest.

Fox News initially reported last January on the “suite of proposals” for “new and innovative sources of funding,” prepared by a 25-member panel of medical experts, academics and health care bureaucrats, when it was presented of a meeting of WHO’s 34-member Executive Board in Geneva.

Now the proposals are headed for the four-day annual meeting of the 193-member World Health Assembly, WHO’s chief legislative organ, which begins in Geneva on May 17.

The Health Assembly, a medical version of the United Nations General Assembly, will be invited to “take note” of the experts’ report. It will then head back with that passive endorsement to another Executive Board meeting, which begins May 22, for further action. It is the Executive Board that will “give effect” to the Assembly’s decisions.

What it all means is that a major lobbying effort could soon be underway to convince rich governments in particular to begin taxing citizens or industries to finance a drastic restructuring of medical research and development on behalf of poorer ones.

The scheme would leave WHO in the middle, helping to manage a “global health research and innovation coordination and funding mechanism,” as the experts’ report calls it.

In effect, the plan amounts to a pharmaceutical version of the U.N.-sponsored climate-change deal that failed to win global approval at Copenhagen last December. If implemented as the experts suggest, it could easily involve the same kind of wealth transfers as the failed Copenhagen summit, which will send $30 billion a year to poor nations, starting this year.

The WHO strategy involves a wide variety of actions to transfer “pharmaceutical-related technology,” and its production, along with intellectual property rights, to developing countries, according to a condensed “global strategy and plan of action” also being presented to the World Health Assembly.

Regional “networks for innovation” would be cultivated across the developing world, and some regions, such as Africa, would be encouraged to develop technology to exploit “traditional medicines.”

According to the condensed plan of action being presented to the Assembly, a number of those initiatives are already well under way.

Click here to read the plan of action.

The rationale for the drastic restructuring of medical R and D, as outlined in the group of experts’ report, is the skewed nature of medical research in the developed world, which concentrates largely on non-communicable diseases, notably cancer, and scants research on malaria, tuberculosis and other communicable scourges of poor countries. It cites a 1986 study that claimed that only 5 percent of global health research and development was applied to the health problems of developing countries.

(In dissecting contemporary medical R and D, however, the expert report glosses over the historical fact that many drugs for fighting communicable diseases in developing countries are already discovered; the issue in many cases is the abysmal living and hygienic conditions that make them easily transmitted killers.)

What truly concerns the experts, however, is how to get the wealth transfers that will make the R and D transfers possible — on a permanent basis. The panel offers up a specific number of possibilities.

Chief among them:
• a “digital” or “bit” tax on Internet activity, which could raise “tens of billions of U.S. dollars”;
• a 10 percent tax on international arms deals, “worth about $5 billion per annum”;
• a financial transaction tax, citing a Brazilian levy that was raising some $20 billion per year until it was canceled (for unspecified reasons);
• an airline tax that already exists in 13 countries and has raised some $1 billion.

Almost casually, the panel’s report notes that the fundraising effort would involve global changes in legal structures — and policing. As the report puts it: “Introducing a new tax or expanding an existing tax may require legal changes, nationally and internationally and ongoing regulation to ensure compliance.”

As a backup, the panel offers some less costly, voluntary alternatives, including “solidarity contributions” via mobile telephone usage, or set-asides on income taxes.

Yet another alternative: new health care contributions from countries such as China, India or Venezuela, or higher contributions from rich countries — neither idea looking likely in the current climate of international financial crisis. In the report’s words: “channeling these resources in this way can only be achieved if there is political will to do so and a convincing case is made.”

Click here to read the financing report.

As follow-up, the experts suggest that WHO promote each and every suggested approach for new financing, along with “regulatory harmonization and integration” in the developing world, “research and development platforms in the developing world,” and new “product development partnerships” to kick-start the global medicines program.

Just as big an issue for WHO, however, may be whether it can adequately manage the money it is already getting — or trying to get — for its current planned needs.

Other budget documents intended for the World Health Assembly, and obtained by Fox News, paint a picture of an organization where:

• spiraling financial demands are beginning to outstrip the ability of member-nations to pay;
• outsized headquarters budgets, in contrast to the regional and country networks where WHO’s public health work is largely done, are rising even faster than the overall budget; and
• efforts to control onerous staff costs are just getting underway.

Those challenges are laid out in WHO’s proposed biennial budget for 2010-2011, which calls for a combination of mandatory and voluntary contributions from the world’s nations — meaning, overwhelmingly, the three dozen richest ones — of $5.4 billion — a whopping 27 percent increase over the same initial draft figure for 2008-2009.

But that increase, large as it is, will likely be far less than WHO needs before the latest biennium ends. In 2008-2009, the initial $4.23 billion draft budget was “revised” to a final $4.95 billion during the two-year period, a 17 percent increase.

Using the same inflationary measure, WHO’s spending could well climb to $6.3 billion before the end of 2011.

Click here for the draft 2010-2011 budget.

One of the biggest jumps would come in the spending centered on WHO’s headquarters in pricey Geneva — a 44 percent climb in its share of program budgets, from $1.18 billion to $1.7 billion, even before any future “revisions.”

More…