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Saturday, March 9, 2013

The Schengen Agreement: Germany Discriminating Against the Roma?

In the case of the U.S., once someone enters one of the states, that person can move from state to state without having to show a visa or passport. The open borders correspond to the states that are members of the United States. In the case of the E.U., however, the open borders do not necessarily dovetail with the states that are members of the European Union. This presents problems that do not exist in the U.S.
Under the Schengen Agreement, passport-free travel is allowed from state to state. As of early 2013, all of the E.U. states were included except Britain, Ireland, Cyprus, Romania and Bulgaria. Even in the latter four states, E.U. law allows any E.U. citizen residency for work or study. This does not apply in Iceland, Switzerland, Liechtenstein and Norway because they are not states in the E.U., though as part of the Schengen Agreement they take part in the passport-free travel that is allowed among the states in the agreement.
Lest one have the impression that states both inside and outside the E.U. face particularized conditions regarding work, study, and travel, this case illustrates the hazards in having too many “tracks” in the European Union as well as in Europe more generally. That a state such as Britain can opt out of the E.U.’s social policy, for instance, while Ireland can opt out of passport-free travel presents us with a rather complex quilt of sorts that E.U. officials (and citizens!) must navigate. The question is whether the diversity of “ins and outs” of particular E.U. states undermines the unity necessary for the Union to be viable. Related to this concern is the question of whether the diversity is due to the inherent diversity among the states or the extent of relative state-level over federal-level power in the Union.
For example, German Interior Minister Hans-Peter Friedrich said in early March 2013, “Germany will veto [the attempt by Bulgaria and Romania to join the Schengen Agreement] and they will fail.” Although Friedrich pointed to the extent of bribery in the two states as sufficient for the German government to worry that non-E.U. citizens could bribe their way to Germany through Bulgaria or Romania, the actual motive could have been to keep out the poor Roma. That is to say, the motive could have been prejudice against a particular ethnic group. “Those who acquire a visa through bribery could travel all the way to Germany without further controls,” he said. However, Romanian Foreign Minister Titus Corlatean said poverty in Romania and Bulgaria was the real concern of the German government. Indeed, Friedrich himself suggested that E.U. citizens who come to Germany to get social welfare benefits should be barred from doing so. Yet in going beyond poverty per se, Friedrich had referred to Roma migrants as “unwanted guests.” This might be the bottom line for the German government.
                                                                                      German Interior Minister Hans-Peter Friedrich.
The question is whether the E.U. is simply too weak to stop the state government of a large state from effectively discriminating against a particular ethnic group (rather than merely poverty per se). If such discrimination is contrary to the E.U.’s founding values and its human rights law, the problem may be in allowing states a veto on expanding (or contracting) the applicability of the Schengen Agreement. That is to say, continued discrimination may be a byproduct of excessive state power over federal power that is not simply an aggregation of state interests. This dynamic would doubtless be familiar to Americans living in the context of Slavery and the ensuing struggle for civil rights.


Jessie Wingard and Daphne Grathwohl, “Germany to Keep Romanians, Bulgarians Out,” Deutsche Welle, March 6, 2013.


Wednesday, March 6, 2013

JPMorgan Management Evades Stockholders

After the $6 billion trading loss at JP Morgan, the U.S. Senate Permanent Subcommittee on Investigations issued a report raising the prospect of wider problems than that of a rogue lower-level trader. Specifically, the report suggests that executives at the bank “ignored warning signs and failed to alert investors about changes to its method for detecting risk,” according to the New York Times.  That is, the bank had not been publically disclosing its risky trading, thereby misleading stockholders and regulators. Banks such as JP Morgan had been urging regulators to weaken the Volcker Rule in the Dodd-Frank Act of 2010 to allow banks to continue to engage in some risky proprietary trades.
The full essay is at "JPMorgan: An Unethical Monstrosity?"