Finger in the dyke

While the markets appear to be going into meltdown, the "colleagues" are desperately trying to hold the line, in a last-ditch attempt to salvage the remnants of "European unity" as the edifice crumbles around them.

Contradicting its own story of last night, The Independent is now reporting that Europe's (it means the EU) state aid and fair competition rules will not be relaxed.

As the number of national bail-outs of banks and finance houses piled up for approval by Brussels, we are told, the Commission's chief spokesman said the current rules were part of the solution, and had always been designed to allow for flexibility in "exceptional circumstances".

Johannes Laitenberger insisted that the rush of announcements of unilateral government bail-outs over the weekend did not break the spirit of a "closer financial co-operation" deal at a weekend summit in Paris between Britain, France, Germany and Italy.

Waaaaaaaaaaaaaaaaaa!

Nevertheless, Laitenberger said today – with his tongue so firmly in his cheek that the tip must have been hanging out of his backside: "The measures taken by different member states are in the spirit of a co-ordinated approach … Let me be clear: These (EU state aid ) rules are not being changed, because it is completely false to say they stand in the way of a sensible, reasonable, single market solution. These rules are part of that solution, not part of the problem."

He adds: "They have been designed all along to be flexible in exceptional circumstances, and these are exceptional circumstances - so there is no need for a phantom discussion about changing the rules".

Waking from its deep slumber, even UKIP has been moved to make a comment about this. "Does he think we are stupid?" asks Nigel Farage:

The system doesn't seem to be able to cope with a crisis, so why have the system at all if everybody reverts to the natural state of protecting their national interest. It is a good thing that the rules are being waived, but surely that is the point. National independence with governments acting in their own best interest is a far more flexible and subtle system. Lets keep it that way.

Better late than never, I suppose, and I guess we'll not be hearing anything about this from Mr Osborne and his Tory pals. They, of course, don't "do" Europe.

Other posts on the financial crisis here.

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