The different country

Europe is a different country: they do things differently here, but there's only so many ways I can bang that particular drum, and only so many ways I can repeat that the whole edifice is designed not to get in the way of national governments running the show. It is precisely why they chose that van Rompuy character to be President. He may be competent, he may be easy-going; but damp rag and low-grade bank clerk or not (as Nigel Farage, the ex-UKIP leader in the European Parliament so elegantly phrased it), he is essentially harmless.

Actually, it was fairly ironic that Farage was so vitriolic in his attack on our new Dear Leader this week: for him, it is quite a victory that van Rompuy is so invisible for fairly obvious reasons. The less representative - the less sex appeal that he has - the less that he's going to interfere with Nigel & friends' attempts to ridicule and undermine the whole system; and the less he's going to attempt to edge into the chummy family photos at World-leader style summits. Incidentally, van Rompuy gave his talk at the College this week, and to his credit he was a better speaker than I thought he would be, even if he was clearly wearing the same suit and tie as the day before when Farage had a go at him

Van Rompuy is quite possibly the best possible choice for President of the EU that Farage or anyone not a rampant Eurofederalist could have hoped for, because he is - in the words of one of my colleagues - completely without 'aura'. Van Rompuy, I am sorry to say, projects about as much leadership as a rubber chicken. They got precisely what they asked for.

Getting what we ask for is another story, and it is a choice, at least in the UK, between a rock and hard, dour, unrepentant Scot. In any case the lack of direction in the EU is fine because for now, it precludes any 50s-era Grand Plans which - given the half-assed compromising nature of the decision-making procedure - are usually half-baked and don't taste all that good.

If you want an example, just look at that monopoly money called the Euro, pick out a book called The Economics of Monetary Union by Paul De Grauwe and turn to the page about the tongue-twister that is 'fiscal transferability'. In a nutshell, the European Monetary Union doesn't have 'fiscal transferability', because when EMU was cooked up ready for the 1992 Maastricht treaty, none of the chefs wanted to give up their abilities to tax and spend as if budget deficits were the new black.

Monetary union - and I apologise for boring you with the details - requires fiscal transferability because without it, the currency destabilises and falls apart. This is the reason for what in EU circles is called the 'Stability & Growth Pact', known by everyone else by its other name 'pfff ...hahaha the SGP, lolz'. The bloodlust for Schadenfreude from early commentators aside, there were many economists who were quick to point out that a European Monetary Union without a method for ensuring that some regions' growth or decline doesn't upset the fine economic balance would collapse at the first crisis. Well we've had a bump or two in the road, and the best is yet to come.

We now have a system where countries such as Greece and Spain make a mockery of public finance (and when I say mockery I really mean such rampant financial mismanagement as to make good ol' Flash Gordon look like a bastion of careful, considered economic direction), and their irresponsibility completely undermines the steadiness of the European economy. Shocks to their economies are not easily absorbed and gradually balloon from slight asymmetries to become embedded, permanent structural weaknesses in the edifice of the European (and particularly Eurozone) economy. And, because the Treaty - the Koran of European integration - forbids the EU from issuing its own debt, which is the standard tool of macroeconomic stabilisation, there is sweet F.A. that the European Central Bank in Frankfurt can do to stop it.

This is why Greece has been able to run a budget deficit of over 14% (and I add that not even the Greeks know the real figure - they actually lied on their last budget report, neglecting to include some 5 or 6% of defence spending); there is nothing to really enforce responsibility, and nothing can (legally or practically) be done to correct it. The agreement made at the birth of the Eurozone that no Member State would act in a way to endanger the viability of the EMU was 'forgotten' pretty much from the word 'Go!', but no surprise there, let's face it.

Because of its significant economic power, Germany has been the creditor for these countries for a long time, but now the Deutsches Volk have quite simply had enough of paying to bail out mendacious Mediterraneans. One must beware of Greeks begging for money.

It is quite simply a miracle that the Euro hasn't already succumbed to a barrage of speculative attacks and broken up like most monetary unions of old. Its demise is unlikely for now - but it is possible - and needless to say the end of the Euro would be the end of the EU. It is very telling that the grandest of Grand European projects was suggested, planned and implemented with such total and utter disregard for even the most basic principles of economic common sense.

This is why we require leadership - good leadership, not cardboard cut-out Belgians and UK Labour party activist cronies arbitrarily assigned cushy Brussels offices and paid more than Barack! What is needed is the real legal power to govern, tax and allocate resources where necessary. But this will never happen, not because national leaders are self-evidently better (because, well, they aren't are they Silvio...) but because their squabbling and allergy to joined-up thinking emasculates worthwhile endeavours before they're even off the Council table.

In 2000 the EU attempted to implement an ambitious Grand Plan called the Lisbon Strategy. The aim, and I quote, was to make 'the most dynamic and competitive knowledge-based economy in the world capable of sustainable economic growth with more and better jobs and greater social cohesion, and respect for the environment by 2010'. It failed. The Lisbon agenda read more like a children's wish-list to Santa, which made its abortion all the crueller when a lump of coal was found in the stocking on Christmas day.

We, here at the College, also hear a lot about how the European Union will one day overcome its problems and materialize onto the world stage to stand as the counterweight to the emerging G2 of the USA and China. Van Rompuy actually said this to us yesterday. I'm not saying I know better, but: He's wrong.