EU Commission: Fines and Sanctions, a corrupt policy

Spain and Portugal have failed to comply with the EU rules regarding budget deficits so the EU Commission is contemplating fining the countries up to .2% of GDP and .5% of their respective EU subsidy payments. Really? Exactly how much revenue does the EU Commission collect from ‘fines’?

The EU Commission apparently attempted to fine Greece on numerous occasions – once after a toxic waste dump was not closed down. They asked nicely in 1992 and in 2001, they finally fined Greece $19,000 per day until the dump was shut down. In 2005 the EU Commission again fined Greece for its failure to crack down on illegal landfills. This time they imposed fines in the neighborhood of $25m Euro. Greece subsequently defaulted on its payment to the IMF.  Surprise!

The concept reminds me of debtors prison – since you can’t pay some of your debts we’re going to eliminate your ability to pay ALL your debts by putting a strangle hold on you. Logical?   No of course not. So the threat looses it’s value because there is ‘no win’.

How do you create a win-win?   Incentive.

Years ago California had a great idea (once) – they offered a highway contractor a monetary incentive to finish the project early and a decentive for every day they were late. Surprise! The project came in early. Despite the fact that it was a great success, the concept was tabled. Why? Because it set an example, it proved a point, and the unions and lobbyists knew the far reaching ramifications could affect every contractor going forward. Pffft.

With BREXIT, the EU Commission lost a gainful ante into their pool of euro’s. They have a choice; either increase the net revenues each remaining member must ante, or find alternate sources, as in new members. What they cannot do is alienate their current members with excessive penalties and sanctions unless they want to unravel the entire EU.

So why are they picking on Spain and Portugal?

The problem is that just about every country in the world rides a budget deficit. The exceptions are: Kuwait, South Korea, Germany, UAE, Uzbekistan, Switzerland, Singapore, Qatar, Oman and Norway. The worst offenders are: US, Pakistan, Japan, India and the UK.

Technically, if the UK had remained in the EU it would be subject to severe austerity cuts and sanctions! And the US would never even make the cut.

The Commission most recently proposed fining EU countries that refused to comply with their refugee quota’s. The fine – 250,000 euro per refugee!  That’s a lot of moola!  At 500,000 refugees that would amount to $125billion.  What would the Commission do with all that money?  Would they give it to the refugee?  Nah.  It would become a part of the sludge of the uncategorized ‘pool’/corruption.

It would appear that the EU Commission makes quite a bounty imposing fines that tag upwards of 30+ per year on various individuals, companies, and countries. The latest haul came just this year when the Commission fined Google $3.4 billion for anti-trust violations. Intel previously had the dubious honor of having the largest fine imposed by the EU – 1.1 billion euro. And last year eight companies faced fines totaling $132million for colluding in anti-competition policies, but that was only a small part of the more than $3 billion the Commission tallies annually.

Who suffers as a result of anti-competition?  The people.  Who reaps the benefit of antitrust fines?  The government. The revenue is classified as ‘other income/revenues’ and is used to support the bureaucracy.   There is no rebate, no award given back to the victims.

But corruption within the EU is considered massive amounting to approximately 120-900 billion euro’s per year, far more than revenues from fines!

So why isn’t the Commission focusing their priorities inward, on the much more lucrative source?   Because the corruption is within the political structure and within the Commission itself. The hypocrisy is classic. Laws are made for everyone – else.   Hillary?

BREXIT: Who is Next

While the media exploits the fear of British expatriates living in Spain, France and Portugal, the truth is far far less intimidating. The fact is, expatriates are creating revenue, they own businesses, they own property and these EU countries reap the benefits of their investment in the economy. International law protects them in the event that a government might attempt to alter the rules of engagement, and their incentive is quite nil.

In fact, Spain and Portugal have historically generously opened their arms to expatriates from everywhere, including the US, offering the same easy transition and assistance. For years, the aura, the beaches, the lifestyle, the stress-free environment of these countries has called to foreigners and they have come eager to acclimate and set-up shop. Tourism is healthy, refugee influx is light, and while crime is an issue in Barcelona and Madrid, it fades dramatically in smaller towns and villages. Although the State Department has issued warnings about the crime rates in Spain, a quick statistical check indicates that the US surpasses their murder rate 5:1, their rape rate 8:1, violent crime 9:1, and total crimes in the US were 85% higher than Spain.

Does that mean the State department should issue a warning for foreigners coming to the US?

While EU expatriates are assured of their status and their rights, incoming expatriates may not have the same rights which should become a negotiation between the respective countries governments going forward.

And despite all this being made clear months ago, despite all the assurances, the media would like to provoke tension and fear with a story of one families fear. Stoking the embers so as to invoke a full fledged fire. In fact, the stories of expatriates is quite the opposite, life has been grand in Spain and Portugal, and returning the the strife and chaos of London simply isn’t an option, nor is it a goal.

The larger issue is the rumbling of EU collapse as other wealthy countries advocate for their freedom. Freedom from what? From a corrupted Commission government that has no transparency, stifling expenses, unaccounted wages, and demands that are not representative of the people, but instead are representative of the Commission. A Commission that needs the wealthy countries to prop up their livelihood and justify their existence – a two government system requiring higher taxation to support.

Not only does the Commission gain it’s livelihood and income from membership taxation, but from excise taxes. Those taxes would not be imposed on countries leaving the EU, and thus their ability to be more competitive in trade negotiations is the attraction, leaving the remaining EU countries scrambling.

While the UK currently has a negative trade balance with their top exports being cars, oil and gold, that VAT tax becomes a hot issue as it is no longer a necessary prop for the Commission. The UK’s major export partners include the US, Germany, Netherlands, Switzerland and France. Obviously, the US is not a part of the EU, but then neither is Switzerland an EU member, and only a part of The Netherlands is a member.

Although the initial impact on the UK will be rooted in more fear than fact, the larger agenda of what is being manipulated to be the new EU, becomes a more interesting question. And Germany most certainly has the most to lose, the largest economy, and largest import of refugees.

I’d be watching Germany.  Not because they have any intention of Germexit, but because they have to ante more and more to cover the refugees, and now the lost revenue of the UK.