I’m a bit disappointed by your populist EU bashing in the article The Cypriot precedent, especially since it is most probably based on wrong information. You claimed that the EU initially required Cyprus to violate the EU-wide 100,000 euro deposit insurance, but to the best of my knowledge it was not the EU/Troika partners who proposed this!
The EU merely required those 6-7 billion euro to be raised by Cyprus and initially recommended to take quite a lot from the deposits exceeding 100,000 euro. However, Cypriot representatives themselves preferred to somewhat protect these deposits and instead to involve the ones up to 100,000 euro (with 6 per cent). So, this indeed bad idea originally came from Cyprus.
I know that in 90 per cent of the news we are told the story you tell, and I admit I do not know the truth, but I suppose you did not actually read the memos of the discussions between “Troika” and Cyprus either. Repeating a wrong thing does not make it right, and to me the version I cited above is extremely plausible, and it completely changes the picture of the “EU vs. Cypriot politicians”, and disqualifies the blame you had for Finnish and Swedish politicians.
It is indeed unfortunate that I am not able to produce a source for my story, but I read it in some large German newspaper about a week ago and cannot recover the article now...
I still want to add that I always enjoy reading your column, and though I am not always of your opinion, but you have solid arguments for your comments and that is educational and informative and makes me think/read more about those important issues – exactly what a newspaper should do!
David Cord’s reply
Thank you for your message. Yes, unless someone is in the room where the discussions are taking place, one can never be too sure of what happens behind closed doors.
One of my favourite sources for information on the European sovereign debt crisis is the Wall Street Journal, which has consistently been able to report on happenings during the EU’s internal meetings. I suspect their source is either a Finance Minister or one of their closest aides.
They report the bank levy was put together by Thomas Wieser of Austria and Jörg Asmussen of the ECB. Olli Rehn, according to the paper, first proposed it during negotiations.
Still, I agree it is possible the WSJ is erroneous, and that the Cypriots were the ones to suggest the bank levy. This is why I complained about the EU Finance Ministers accepting the deal, not proposing it: “…I am stunned politicians would agree to scrap the deposit guarantee, the very cornerstone of financial stability…”
The column is only my opinion, of course, and I have seen some very persuasive arguments to the contrary.
Once again, thank you for your comments. Please feel free to write anytime you see something in the Helsinki Times which interests you.