Swedish banker criticises lack of democracy in eurozone rescue

Villy Bergström, a former deputy governor of Sveriges Riksbank has criticised the approach of replacing democratically elected governments with technocrats in two of the eurozone countries, saying it raises questions about Sweden’s continued membership in the EU.

Bergström, who is also a member of Sweden’s Social Democrat party, says in his latest monthly commetary published by Avanza Bank, that Swedes have never accepted the idea that courts can overrule elected politicians.

The problem now, however, is that the deal struck in December to ‘save’ the eurozone, in particular the decision to implement rules restricting budget deficits to 0.5% and the threat of being dragged in front of the courts in Brussels, means the deal is no longer just about finance, but has slipped into the realm of politics.

This is politics waged by “unelected officials” which creates significant problems: Sweden does not have a ‘constitutional court’ which can overrule decisions by elected politicians, Bergström notes.

“The EU has gotten rid of two elected governments and put in officials to rule Greece and Italy. Is this acceptable to EU citizens? Is this what we voted on [in a referendum] before entering the EU?” Bergström writes.

“Austerity politics will drag Europe into recession, if we are not already there. Mario Monti and Lucas Papademos are no Tribunes, rather educated intellectual types, who must learn to master the anger that follows, when the politics start to bite next year.”

“And what will it be like in the Netherlands, Finland and Ireland when their populations discover that they live under officialdom, which has been put on the EU through agreements between France’s and Germany’s heads of government?”

Bergström’s full text in Swedish follows below:

Sällan har ett årsskifte tett sig dystrare än nu. Obalanser över hela klotet: Skuldberg, budgetunderskott, bytesbalansunderskott, svag tillväxt, brist på politiskt ledarskap. Detta gäller på båda sidor av atlanten. Därtill bromsas tillväxten upp i de nya tillväxtländerna i Asien och Sydamerika.

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