Brussels' Millstone Turned Slowly

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Brussels' Millstone Turned Slowly

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Over the last 50 years change has come slowly within the European Union. The EU Lisbon Treaty, for example, took effect on Dec. 1, 2009, after eight years of work drafting the text of the agreement and getting it approved by all 27 EU member states.

One of the major changes in the Lisbon Treaty is the phasing out of the single nation veto right on EU agreements, which has often been the reason progress has been slow in the past. More than once, a late-night negotiating session was needed to placate a country withholding consent from a new policy—or even a new EU treaty—that had already been accepted by all other EU members.

However, things are changing, slowly (in typical EU fashion) but surely. The swift impact of the worldwide financial crisis provided the impetus for the European Union to take action at a rate much faster than would have been the case in "normal" economic times.

In September 2010, two years after the crisis struck the world's financial markets with full force, the European Parliament approved the establishment of three financial oversight agencies to supervise the European Union's banking sector, financial markets and the insurance and pensions industry. Prior to the final parliamentary approval, EU finance ministers and the parliament had agreed on the framework for financial regulation within the EU, following a year of negotiations involving leaders of individual member states.

The three new regulatory agencies are a direct response to the worldwide financial crisis: the European Banking Authority, the European Insurance and Occupational Pensions Authority, and the European Securities and Markets Authority. These new EU agencies will begin operating in January 2011 and are expected to provide a quick response in the event of a future financial crisis. They are also expected to tighten controls over international banking within the EU.

More important, though, is the fact that these regulatory agencies will establish a precedent for giving the EU oversight jurisdiction over national agencies in member states. Under the new arrangement, the day-to-day oversight in normal times will remain with the national regulatory agencies of EU member states. When EU finance ministers declare an emergency, however, the new EU regulatory agencies can intervene on the national level and overrule a country's regulatory agencies.

The response to the worldwide financial crisis may have established a pattern for Europe's response to threats to EU stability: transferring sovereignty from individual EU members to Brussels, which hosts the official seats of the European Commission, Council of the European Union and the European Council.
More centralization ahead in the euro zone?

Just six months ago, some observers were predicting the collapse of the European Union's common currency, the euro. Currently 16 EU members, officially called the Economic and Monetary Union (EMU), have the euro as their common currency.

The severity of the Greek debt crisis sent shock waves through international currency markets, causing the euro to lose about 15 percent of its value against the dollar. With other euro zone members potentially facing similar problems—Ireland, Italy, Portugal and Spain—it seemed only a matter of time before the euro zone would break apart.

In May German Chancellor Angela Merkel said that the Greek debt crisis has led Europe to a fork in the road that will require the European Union to decide whether or not it will succeed. The key to success is the survival of the euro as the European Union's current and future common currency. According to Mrs. Merkel, a collapse of the euro zone would mean the end of the European Union.

Despite the recent problems, the euro seems likely to weather the storm. The main reason might be that economically stronger euro zone members like Germany appear to be willing to do whatever it takes to ensure the euro's survival. After a meeting last summer with Chancellor Merkel, EU Commission President Herman Van Rompuy remarked that "one can imagine an increase in the 750 billion euro bailout plan." In other words, if the current bailout plan is not enough, another one will be forthcoming.

As the old saying goes, the Greek debt crisis appears to be providing the EU an opportunity to make lemonade out of lemons. In my article titled "Europe's New Money," published in the December 2001 WNP one month prior to the introduction of euro bills and coins, I wrote the following concerning the future success of the euro:

"Critics of the euro have warned for several years that the euro may experience difficulty in becoming a stable hard currency unless economic policy is coordinated among euro countries in the same way that monetary policy is determined by the ECB [European Central Bank]. If those critics are proven to be correct, then the remedy will hardly be a return to individual national currencies...If the critics are right, then the more likely scenario will be the establishment of centrally coordinated economic policy for the euro zone. This, in turn, would represent a further weakening of national sovereignty and require new political institutions to determine such policies" (emphasis added).
Mobilized by the debt crisis

The Greek debt crisis has mobilized EU policymakers. At the end of September—less than five months after the height of the Greek debt crisis—the European Commission called for new measures to strengthen the euro zone and help prevent another crisis that would threaten the euro's survival. Included among the Commission's proposals is the mandatory submission of key national budget parameters to Brussels each spring for approval before national parliaments approve their country's fiscal budget. Such a proposal would have been unthinkable just a few years ago.

In addition, Brussels will give country-specific recommendations to euro zone member states whose budgets are out of alignment and where economic imbalances have arisen as a result of inadequate competitiveness from unsustainable sectors of a national economy.

Olli Rehn, the EU commissioner for economic affairs, emphasized that the current crisis in Spain and Ireland is largely the result of property value bubbles and overdependence on the construction industry. This type of input, too, would have been unthinkable a few years ago.

The EU Commission also proposed changes to the penalty system that is part of the euro's existing Stability and Growth Pact. Germany is pushing hard for this measure. In the future, member states with deficits in excess of 3 percent and public debt greater than 60 percent of GDP would automatically be required to pay an interest-bearing deposit amounting to 0.2 percent of GDP. These funds would be reimbursed once EU leaders are convinced that the noncompliant governments have taken adequate steps to address the debt problem.

However, if action is not taken to comply with advice from Brussels, this deposit could become noninterest-bearing and the noncompliant governments would begin to lose money, with the final penalty being the fund's conversion into a nonrefundable fine.

The new proposals are a direct result of the Greek debt crisis, which showed that the existing rules simply did not work. Under those rules, EU governments never gathered the will to fine each other when their national budget deficits exceeded the set limits. The new rules would mean that the Commission itself would determine whether a noncompliant country should be punished. Member countries would then have to vote to prevent the sanction.

European Commission President José Manuel Barroso said the proposed new system was "the biggest step forward on economic governance since the Stability and Growth Pact was introduced." The Commission's proposals will now be discussed on the national level and in the European Parliament. Some compromises are likely, but the overall direction is clear: Greater central coordination of economic policy within the euro zone is coming. If the European Union is to survive and move toward greater political union, it has no other choice.

Could a future crisis trigger a "core Europe"?

The Lisbon Treaty ensures that future progress toward greater political integration can no longer be impeded by a single nation. Instead, those nations desiring greater political union may proceed without being held back by dissenting EU members. If no unanimous agreement can be achieved on a proposal within four months, those countries desiring to proceed with the agreement may do so without the dissenters.

Thus, for the first time, the EU now officially recognizes the possibility of a "core Europe"—a smaller group of nations that choose to have greater political and economic unity within a larger European Union. That possibility is in line with Bible prophecy for the end time.

In Revelation 17 the apostle John saw a vision of a "beast" that represents the revived Roman Empire dominated by religious influence. As was the case with its predecessors, the final revival of the Roman Empire will be centered in Europe.

John describes a union of "ten kings [leaders] who have received no kingdom as yet, but they receive authority for one hour [a short time] as kings with the beast. These are of one mind, and they will give their power and authority to the beast" (verses 12-13).

The leaders of 10 nations or groups of nations voluntarily cede their power (sovereignty) to the "beast." In Europe's history, empires have been formed by conquest and intimidation instead of voluntary submission. The wording of verse 13 corresponds to a variation on that pattern, one already well established within the European Union.

Verse 14 reveals the time setting: "These will make war with the Lamb, and the Lamb will overcome them." The Lamb is none other than Jesus Christ. At the time of the end of humanity's rule, there is to be a revived Roman Empire, whose armies will literally fight Christ at His return!

This is not to say that the European Union in its current form is the Beast or the exact configuration of nations that will make up those "ten kings" who yield their authority to the Beast. The EU currently has 27 members, with more nations knocking on its door.

On the other hand, the Bible's use of the word kings in Revelation 17:12 Revelation 17:12And the ten horns which you saw are ten kings, which have received no kingdom as yet; but receive power as kings one hour with the beast.
American King James Version×
does not have to mean literal kings. While in John's day it described a government or its leader, today's language and geopolitics could take on a different configuration. The "kings" could represent national leaders or national entities that cede their sovereignty to a central source. In the case of the EU, that has been done most often by national governments proposing agreement with EU treaties and national parliaments approving the proposal, making it binding legislation.

John's description appears to indicate that the "ten kings" will completely transfer sovereignty to the "beast." What would prompt them to take these steps? Most likely it will be some major crisis requiring quick action, like a major upheaval on Europe's southern doorstep, the Middle East or large-scale terrorist attacks within the EU. Whatever the cause might be, out of today's European Union will arise a group of 10 nations or a combination of 10 nation groups that will fulfill the vision revealed to the apostle John: "These are of one mind, and they will give their power and authority to the beast."

The worldwide financial crisis and the Greek debt crisis have prodded EU policymakers to action—not as fast perhaps as in a single country, but faster than the EU has tended to react in the past. When a crisis that threatens Europe's well-being arises, Europe's millstone is capable of turning a bit faster. WNP