Professor Hankel is right

Hardly a surprising title for this blog. I have written about Professor Wilhelm Hankel (who looks and sounds just like a liberal German academic of the very old school should) before (here and here).

Yesterday he spoke at an event organized by Open Europe and there were strong indications that his own thinking has overtaken that organization's hand-wringing attempts to find some way of reforming the EU.

Professor Hankel is not happy about the way the EU is breaking its own laws as enshrined in the treaties. Nor is he too happy about the way the IMF has broken the rules under which it was set up.

According to Professor Hankel, the eurozone bailout package is illegal on three grounds: the loans violate the “no-bailout clause” in the EU Treaties; the ECB’s decision to intervene directly in the crisis and buy government bonds from weaker eurozone countries breaks the ECB’s statute; and, the IMF violates its own rules through its involvement, since under the IMF statute central banks (and therefore not governments directly) are allowed only to get aid in a foreign currency. However, Greece will get paid in euros.

In fact, he is not happy with the euro and never has been because of the complete politicization of money.

But Professor Hankel went further than that. He dislikes the EU and thinks it is time to ... well, to change it completely so it will not be the EU any more. The financial crisis was used as he said to no-one's great surprise to accelerate the change from a federation of states to a federal state and that must not be allowed to go ahead.

However, he did not reply to a question as to how this reversal of the process could take place. I suspect he thinks that at some point the governments of at least some of the member states, led, perhaps, by Germany that will finally shrug off those 12 years of iniquity and recall the many post-war years of successful democracy will simply decide to abandon the Union and restore previous arrangements. Perhaps.