Imagine you lived in a 27-flat condo whose regulation stated that in the case of a fire or a gas leak in anyone’s apartment, all flat-owners had to first agree (by voting in favor or abstaining) before the gas company/fire brigade could be called in (NB: all, including those who would rather tear down the condo and replace it with a parking lot).
This condo is the Euro zone. The current “emergency fund” (European Financial Stability Facility) and its successor, the European Stability Mechanism, which will replace it in 2013, require unanimity on the decision to disburse a loan to a member, as well as on the terms of the attached conditions (I have discussed this issue here ). The success of Timo Soini, the leader of the xenophobic and anti-European “True Finns” party in the Finnish elections of April 18 (his party climbed from 4.1% in 2007 to 19% of the vote), makes the following scenario a nightmare in the making:
0.19 * 0.016 = 0.0031
That is: 19% of voters of a country whose population (5 million 338 thousand) represents 1.6% of that of the population of the Euro area, which therefore represents around 3.1 per thousand of the electorate of the Euro area, could hold in check the future of the entire Euro zone (almost 330 million people). No doubt about it, a true masterpiece of institutional design.