Intense debate in Parliament over euro crisis
Government wins confidence vote
The government responded on Tuesday to an interpellation put forward by the opposition True Finns party on the euro crisis. In the interpellation, the True Finns criticise the government for agreeing to give direct support to overextended euro countries. In its response, the government said that it is in Finland’s own interest to be in the core of the EU, wielding influence on matters. The government also denied that Parliamentary authority over the national budget was being relinquished to the European Commission, or that Finland would be accepting the so-called Eurobonds. After the interpellation debate, the government won a vote of confidence on Wednesday 116 – 73. Ten Members of Parliament were absent.
Soini: The government failed
True Finns party chairman Timo Soini started his somewhat theatrical speech by lashing out at last week’s European Union summit, saying that the government of Prime Minister Jyrki Katainen (Nat. Coalition Party) took a big step toward a “debt union”, a loss of national budgetary power, and the erosion of Finnish sovereignty.
“Finland must not take part in these mechanisms. They oppress Finland in particular, by making us responsible for the blunders of others.”
Soini said that the EU summit did not manage to remove the causes of the European economic crisis, but it did remove the requirement of consensus in decision-making, depriving Finland of the veto.
The summit decided that the planned European Stability Mechanism (ESM) would aim at making decisions based on an 85 per cent qualified majority, measured according to each country’s capital input. There was also a footnote in the declaration that qualified majority decision-making would require approval by Parliament.
“The government’s only achievement was this vague footnote, and now the scheming has started on how that will also be eliminated”, Soini thundered.
Antti Kaikkonen (Centre Party) asked Prime Minister Katainen why he did not simply veto the decision on qualified majorities in the ESM treaty. He got no answer from Katainen.
Soini said that Finland should prepare for the disintegration of the euro.
Kimmo Tiilikainen, the chairman of the Parliamentary group of the Centre Party, said that the Centre is willing to try to help save the euro, but indicated that there is a limit to the price that it would be willing to pay. He emphasised that the Centre Party does not want the eurozone to fall apart, but that preparations need to be made in case that happens.
The Centre Party would have wanted the government to set up a united front aimed at stabilising the euro, while maintaining national self-determination and budgetary power, and would limit the liability of Finnish taxpayers.
Katainen comes out swinging
Responding to the True Finns’ interpellation, Prime Minister Katainen did not mince words. He spoke directly to Timo Soini, who was in the front row.
“You work every day to get Finland out of the EU. You work every day so that the euro, our currency, would fall apart. You believe that it would be good for Finland for our common currency to disintegrate, because you are not afraid of a recession.”
Katainen said that defeating the crisis requires the bearing of responsibility, and that there are no easy solutions to the crisis.
Katainen pointed to what he saw as a contradiction in Soini’s proposals for handling the crisis – calling for keeping Finland out of the arrangement, while supporting the financing of the crisis countries by the International Monetary Fund.
He said that cutting the debts of the countries in crisis is not a solution, because countries that have had their debts restructured cannot borrow money from the market, and will require assistance from Europe and the IMF.
Katainen was backed up by Minister of Finance Jutta Urpilainen (SDP), who said that her ministry has concluded that going back to a separate national currency would lead to unemployment levels worse than the recession of the 1990s and a collapse of GDP that would last for a long time.
During the interpellation debate MPs suggested various causes of the economic crisis. Culprits mentioned included irresponsible governments, neo-liberal economic policies, and an excessively narrow role for the European Central Bank.
Social Democratic Party parliamentary group leader Jouni Backman blamed the crises in different parts of the world on a long history of greed and short-sighted capitalism that fixates on quarterly profit figures.
Backman also emphasised that the SDP is in favour of the principle of unanimity in decision-making in the ESM.
Katainen reiterated that Finland will continue to negotiate with the aim of an outcome that would respect Finnish legislation and would be acceptable by other countries as well.
Previously in HS International Edition:
EU summit: Finland’s concerns remain unanswered (12.12.2011)
PM: Finland needs to be part of ESM (12.12.2011)
Finland sticks to consensus demand at euro summit (9.12.2011)
European Stability Mechanism (Wikipedia)