Mathew D. Rose: Is It Time to Pull the Plug on the EU?

By Mathew D. Rose, a freelance journalist in Berlin

“Success is relative” wrote T. S. Eliot in his play The Family Reunion, “It is what we can make of the mess we have made of things.” This is an apposite description of the current “success” in the EU. A financial and political disaster has been transformed into a permanent calamity. Most of southern Europe dwells in an economic depression and the rest does not appear to be recovering. Success is currently defined as not being in recession. As “growth” in the third quarter fell to 0.2% in the EU (in the Euro-currency group 0.1%) there is talk of “recovery still slowly stabilising”. It is truly impressive to what depths success can plumb.

The reality of the malaise came home to many as the year-on-year core inflation rate (excluding volatile items such as energy and food) in the EU fell to 0.8% in October. With deflation now a threat for many EU member states (it is already reality in Greece, Bulgaria, Cyprus and Latvia), one must ask not only how the highly indebted EU nations are to repay their debts, but how the European Union can achieve an internal rebalancing? If Germany with its high productivity has low inflation, the other EU countries, who would have devalued their currency before the inception of the Euro, will have to dramatically deflate their economies – and that after years of virulent austerity. This might seem a simple solution for economists and bureaucrats, but EU member states are democracies and patience in many of the peripheral nations – and not only those – is running very short.

The situation on the ground is dramatic. In October the International Federation of Red Cross and Red Crescent Societies published a report entitled “Think Differently – Humanitarian impact of the economic crisis in Europe”, which provides sixty pages of sobering reading. The situation within the 52 nations that comprise Europe according to the report is not “stabilising”, but spiralling downwards: “There are now more than 18 million people receiving EU-funded food aid, 43 million who do not get enough to eat each day and 120 million at the risk of poverty in the countries covered by Eurostat” (the EU nations plus Iceland, Norway, Switzerland, Turkey and FYR Macedonia). Today one of the Red Cross’s principal tasks in Europe is feeding an increasing number of people, because without this aid the affected persons could not pay their rent und utilities. The Spanish Red Cross has for the first time had to launch an appeal to assist the citizens of its own country.

In the same month Trussell Trust foodbanks in the United Kingdom reported that “Over 350,000 people received three days’ emergency food from between April and September 2013, triple the numbers helped in the same period last year.” Yet the UK claims to be enjoying the most robust recovery in Europe.

Yves Daccord, Director General of the International Committee of the Red Cross, gave an important warning earlier this year: “Europe has a long record of maintaining a plausible trust in the future of its young people, even during turmoil. Not anymore. With prices rising and rampant unemployment, young urban people no longer see any future for themselves, and governments start losing credibility and legitimacy.”

Probably the most unsettling aspect of the crisis is that of Europe’s youth. This is not only reflected in youth unemployment – almost 25% in the Euro zone states (Greece and Spain are approaching 60%, Italy is over 40% with Portugal not far behind and Ireland with close to 30%. One reason the numbers are not higher is emigration. In all these nations, with the exception of Italy, which is inundated by refugees, emigration has outstripped immigration. Those departing are purportedly young people seeking work. This is also affecting the birth rate in Greece, which has fallen 15% in the past four years according to Greece’s health ministry. This has resulted in part due to a radical increase in miscarriages, which in 2012 increased threefold in comparison to the previous year. For Giorgos Kreatsas, head of the maternity clinic at Athens University, this is a direct result of the economic pressures and insecurity families are facing. Add to this a 40% cut in health services since the crisis commenced.

This cannot be the brave new world envisioned by the founders of the EU.

Why are things not getting better? In October the Directorate-General for Economic and Financial Affairs of the European Commission published a report “Fiscal consolidations and spillovers in the Euro area periphery and core” by Jan in’t Veld, one of its economists. The author comes to the conclusion that “Germany and other core euro area countries” through their austerity policies not only reduced growth in the periphery EU nations, but also increased their debt-to-GDP ratios. This, according to the author, could have been mitigated. Due to a “flight to safety” Germany and the others had benefited from low interest rates on 10-year government bonds, which sank to below 2%. These nations were in a position to increase public expenditure to stimulate the EU domestic market, which would have benefited the periphery nations. Instead they reduced spending. Germany refused to help, enjoying the benefits of cheap credit and a weak Euro, which enabled it to find new markets to replace exports lost in Europe due to the economic downturn.

Jan in’t Veld concludes that

Spillovers from consolidations in Germany and core euro area countries have worsened the overall economic situation. A temporary fiscal stimulus in surplus countries can boost output and help reduce their current account surpluses. The improvement in current account deficits in the periphery is however small.

In fact, in the periphery nations it is growing worse.

A month after the publishing of Jan in’t Veld’s paper the US Treasury came to a similar conclusion in its monthly report:

Germany has maintained a large current account surplus throughout the euro area financial crisis, and in 2012, Germany’s nominal current account surplus was larger than that of China. Germany’s anemic pace of domestic demand growth and dependence on exports have hampered rebalancing at a time when many other euro-area countries have been under severe pressure to curb demand and compress imports in order to promote adjustment.

In 2013 Germany is aiming for a record trade surplus of 200 billion Euros (2.72 billion dollars), the equivalent of seven per cent of GDP.

The German government dismissed the Treasury criticism: “There are no imbalances in Germany that need correction,” a finance ministry spokesman said. “On the contrary, the innovative German economy contributes significantly to global growth through exports and the import of components for finished products.”

In other words Germany has no intentions of assisting Europe’s recovery. This once again became obvious when the European Central Bank reduced its benchmark interest rate in a surprise move to a record low of 0.25%, down from 0.5% to combat the increasing deflationary threat within the EU.

Again the Germans railed against this measure, hitting below the belt and claiming that the ECB’s head, the Italian Mario Draghi, was using cheap credit to prop up banks in his financially beleaguered country. Both of Germany’s members in the ECB, voted against the proposal. The Germans seem to be obsessed with the ECB providing an ideal monetary policy for them at the cost of others. Since the inception of the financial crisis the ECB and EU have obsequiously been following the German dictate, however with horrendous consequences.

What Draghi and the ECB members who voted for the interest reduction know is that there is just so much suffering and sacrifice that a democracy will tolerate. The point was reached long ago for many EU nations. Germany – at least its wealthies ten percent – to the contrary, is not only indubitably the winner of this crisis, but has gained hegemony in the EU that was never supposed to have happened.

In May of next year there will be an election for the EU parliament. What many in the United States with its political history of two main parties do not understand is that in Europe many people do not vote for political parties, but against them. To show their displeasure with the political class they select a “protest party”, not because they necessarily reflect their personal preference, but to express their disenchantment with the traditional parties. With regard to the current management of the financial crisis in the EU this will doubtlessly occur and rightly so.

Unfortunately most of the parties well positioned for an anti EU establishment vote come from the far right, parties such as the Front National in France, the Freedom Party in the Netherlands or UKIP in the United Kingdom. All of these are strongly anti-EU and will score resounding successes. Even in Germany, the newly established party “Alternative for Germany”, Europe’s newest rightist populist party, which criticises the German government for being too generous to its EU neighbours and wasting German taxpayers’ money on profligate nations, will probably score a resounding success. Following these elections the EU parliament will contain a large fraction that is for its dissolution. This is still another crisis in the making.

Anyone hoping for a change in policy by the new German grand coalition government only needs to read its programme concerning the EU: “To insure that Europe finds a sustainable solution to its crisis necessitates a comprehensive political approach, a structural reform for more competition and strict austerity, with investment in growth that is a socially balanced.” In other words, we can expect more of the same.

The question is, if it might not be better to dissolve the European Union in an orderly fashion instead of continuing the German led calamity. One saw what became of Germany’s last attempt to create a new European order seventy-five years ago. The current situation shall only be complicated following the European parliamentary elections, when it is infused with ultra-right populist parties. Europe seems to be falling back upon a formula that ended in disaster once before – a disaster caused by governments who became spectators of their own inaction – until it was too late.

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  1. John

    I live part of the year in southern Spain and I can add that part of Europe is lost, no hope ever to recover. One would think with such a disaster on their hands the political elite would pull out all the stops to shore up the place. Think again. The people who voted in the euro and promised all be great are the same ones now pushing through tuff austerity and higher taxes.

    The long term implications are painful. There are more suicides, diseases, homelessness, cut pensions, etc…. all due to a cadre of political elite guaranteeing bond holders of perripehry country debt 100% payment.

    1. susan the other

      It is as if the EU banks are being guaranteed by an undeclared global war policy. Just scanned an article about the “importance” of Europe and the reason was that Europe is the most prolific “investor” in other countries. At a time when their own periphery is sinking fast. Where is the money for the benefit of the union? Well… that was never part of the contract. Where is the money for US states; for munibonds? Prolly off to Africa and other irresistible bargains. Gotta buy up assets while prices are devastated. That’s what Japan Inc. is doing too. Not to mention China. When Merkel and her new coalition sign their new platform to include “investing in growth that is socially balanced” there could be an underlying agenda. And maintaining “strict austerity” simply demands an explanation.

  2. disc-writes

    The article contains a bad mischaracterization of Alternative for Germany which, as far as I can understand, is neither rightist nor populist, and it does not criticize the government for being too generous – but not generous enough.

    It seems to me they understand very well that, without the Euro, Germany would absorb imports from Southern Europe and help the recovery. And they want Germany to leave the Europe to save the European project, not to sink it.

    The remark above applies to the whole article: the end of the Euro is not the end of the EU. On the contrary, it is probably the only way to save it.

    And Germany might be the cause of much trouble, but the Euro is definitely not a German attempt to establish a new European order as it was imposed on Germany – misguidedly – by France and Italy.

    Also, as colourful as the UKIP and the PVV may be, they are very well within the limits of a civilized democratic debate, and by no means “ultra-right populist parties”. The only countries that have to deal with ultra-right parties, at the moment, are Greece within the Euro, and Hungary without – together good for a tiny fraction of the European population and economy.

    So, hm, I understand you need to dress up reality to make it more attractive for uninformed American (and Australian?) readers, but this has gotten a bit too far.

    1. bmeisen

      The anti-EU rants at this site generally don’t deserve rebuttle but the parallel between Hitler and the EU that this Tiergarten semi-intellect draws is so disgraceful that it can’t be left unchallenged. The author ignores the recent Irish recovery. That’s understandable given that it undermines his premise. That he also ignores the accomplishments of more than 5 decades of European harmonization reeks of a liberalism that social democrats in Europe have long recognized as degenerative and pernicious. Recently revealed monetary flaws as well as undeniably unwise preferences for austerity policies do not nullify improvements made across the EU in democratic institutions, infrastructure, education, workers’ rights, environmental and consumer protection, and committments to cultural programs that have been achieved by more and more European social democracies persisting in working with each other.

      1. Ignacio

        Definitely, you live in a different, imaginary Europe. I can write about Spain and I can tell you that any gain or progress made from 2000 has been wiped out fast. There is not harmonization, on the contrary, differences are growing bigger. We are even watching totalitarian-like laws being approved lately in Spain that would heve been unthinkable 20 years ago. It is sad and depressing indeed. Racism is showing its ugly face all around Europe ¡Again and again! I wonder that if europeans learnt any lesson after the WW2 it is being forgotten.

      2. The Dork of Cork

        What do you know of Irish history ?
        I have recently worked with guys from up North and my impression of them has solidified .
        They are the lost boys of the money power.
        To be pitied for their insular non understanding of what the UK truly is.
        They laugh at us for getting buggered by the Vatican but their self deception is much deeper then the concept of the Holy trinity.

        From a economic perspective Irish productivity was exported on a much more massive scale when we joined the UK mark 11 (the new improved version)

        You should try to get a hold of Derry Powers late 1970s take on a late Cork minister imploring us to increase productivity while reducing wages…..
        In a comedic manner he showed quite clearly that the Euro dream was just another Soviet illusion / nightmare.

      3. salvo

        typical of the hypocrisy of the german social democracy, claiming to pursue the dream of a german Europeanisation while indeed supporting the very nationalistic agenda of a germanification of europe, that is to say the enforcement of the interests of the german export industry

  3. The Dork of Cork

    Germany is a colony – it produces value added items which it cannot consume.
    The more and more I look at the EU the clearer the water becomes.

    The fulcrum of the EU is not Brussels or even Frankfurt …but London.
    The UK and France are now the only 2 major countries in significant real goods trade deficit (subtract “services” from the UK economy and you see how England truly works)
    Certainly since it started to import coal after 1970 things have changed utterly for the UK physical economy.
    The entire economy is now geared towards receiving surplus finished goods from Europe and Asia and now since the decline of the North Sea massive primary goods input.

    This subtraction of primary goods via the destruction of peripheral economies from its now euro hinterland is the reason why its trade deficit has not moved and even increased after devaluation.

    1. Moneta

      Emerging markets have to take over but we won’t let them because we want to keep resources and energy for our own consumption.

      So all Western countries are stuck with rising debt and looking for ways to stick it to other countries.

      1. The Dork of Cork

        Who exactly is we ?
        Europe is a failure because of the Anglo / Dutch scarcity merchants which manage scarcity throughout the continent in the various financial capitals…..they get a rent for such activities …they then subsequently use this rent to buy real physical goods subtracting resource usuage from the workers.

        Look at the physical economy of Ireland.
        It has become a toll booth economy.
        The Waterford PPP bridge is a total failure from a local physical economy perspective….but as long as the rent is paid its a success from a European perspective because Europe is a continent built on global rents.

        1. The Dork of Cork

          A old post but nothing has changed as I recently observed this road during rush hour….empty….

          Meanwhile the old Cork to Waterford road remains busy…wasting fuel.
          The financial capitals of Europe survive by charging a rent on fuel waste as cities of such a scale cannot be serviced by agricultural hinterlands.

          A general characteristic of the Euro has been a neglect and subsequent destruction of all that is local and good.

          1. The Dork of Cork

            Contrast the above toll road with the old Waterford to Tramore line.

            A Quaker run line where they issued a form of local quasi social credit to insure the sustainability of the line.

            The Quakers had no skin in the game of scarcity.
            Notice how little physical capital (forget about the token usuage) went into this line with 4 engines lasting into the 1930s and beyond.
            Now imagine the individual depreciation if everybody in the 1930s drove a Austin to Tramore Beech……

            The Irish middle management have totally abandoned the local physical economy so as to trade extremely long distance goods with our figurehead going to Jap land to sell Irish beef !!!
            All so as to pay external debt………its got nothing to do with rational trade…how could it be rational ???
            The absurdity of the situation is beyond even my dark sense of humour.
            It cannot Be parodied.

            1. Moneta

              Just read the comments when people try to define money. It invariably turns into the Tower of Babel.

              No one seems to agree on anything yet they all believe they “deserve” the money they get and don’t want others to touch their well deserved money. People want to believe that someone can be self made.

              If the value of money has been totally distorted at the individual level, how can one expect the system to work?

            2. Moneta

              I’m convinced that Europe is consuming more joules than it is exporting. Energy is a country’s most important asset. Yet every country is still playing by the old rules as if there are no energy constraints.

              I know someone is going to come out of the woodwork and argue that this world if full of energy and there are no energetic constraints. But I will argue that in the short-term we can only harvest a certain type of energy depending on the technology we have commercialized.

              And those unwilling to accept this short-term scarcity, who are stuck with the short end of the stick, will get burned.

              And the islands are obviously the first going through the wringer. Interestingly, this is something Jared Diamond had predicted.

              1. The Dork of Cork

                Europe is a extreme value added economy – the longer and more complex the production process the more inputs are required.

                And you don’t have to export to get imports…you can consume your own product….despite its free trade traditions the UK was pretty much a closed economy from a energy point of view until the post war period… had a period of flux which created the bleak “Get Carter” landscape of the 1970s and now it has been fully adjusted to take external goods only.

                UK final energy consumption 1948 Mtoe
                Total ;131.5
                of which
                Coal / Coke : 101.5 (direct burn)
                oil : 13.2
                NG : 0
                town gas /coke gas : 12.5
                electricity : 4.2

                Uk final energy consumption 2008 Mtoe
                Total : 154.8 Ktoe
                of which coal / coke (direct burn) : 2.6 !!!! –
                oil : 68.1
                NG : 51.7
                Town gas / coke gas 0.1
                electricity : 29.4
                renewables / waste 1.8.

                Look at the change – direct burn in fireplaces or furnaces have ceased….the UK has successfully transferred its transformation losses elsewhere.
                Most of its coal imports come from external areas and most of this is now burned for electricity generation.


                1. Moneta

                  I know. If you have resources then you have to sell a lot this low margin stuff to be able to import the added value stuff… but when you run out, watch out if you can’t produce anything of value.

                  If you have no resources then it’s a race for producing added value stuff so you can import resources that you can use yourself.

                  In the process of getting a share of resources and focusing on added value production, many countries have forgotten to maintain their survival skills, making themselves incredibly dependent on other countries for staples.

                  You can’t keep on consuming more joules than you produce forever unless you are extremely vigilant about your energy consumption. Rare are the countries who have efficiently planned for this energetic reality because no one seems to see the deep connection between money and energy.

              2. F. Beard

                The Lord has provided the Earth with a fabulous amount of energy and even hinted more is available by refilling some oil fields in Texas (under Christians?). Plus the Earth is ONE creative genius away from practical fusion power.

                So try to understand, Progressives. We will ALWAYS have enough if we practice justice.

                If we start dismantling the counterfeiting cartel and thus quit oppressing the poor, how can that not impress the Lord you don’t know and thus can’t love?

                Hint: Even atheists should agree with “Thou shall not steal.” If you can’t then who will disagree with “To Hell with you”? The poor victims?

                1. The Dork of Cork

                  @F beard
                  Sure I agree with you but the policies of the scarcity merchants has changed the very landscape around us in a quite profound and unstable fashion.

                  The Inertia & over specialization of real physical systems such as the UK becoming a extreme deficit nation with all the Industrial systems used to convert other peoples surplus goods and the Eurozone producing value added goods for the Financial centers could not be overcome easily – even with all the good will in the world.

                  Remember the Big Bang of London was a result of deflation within the eurozone – the wealth not consumed locally had to flow elsewhere…….when they feel they have enough capital they then blow bubbles so as to maintain the relative wealth disparity between the insiders and outsiders.

                  1. F. Beard

                    You give the scarcity merchants too much credit compared to the serendipity of God’s Nature.

                    Today, I read about a infra-red sensor that works at ROOM TEMPERATURE and is very sensitive. What? That’s impossible! Those things have to be cooled down with liquid nitrogen or the thermal noise of the sensor destroys the inherently weak (long wavelength) signal.

                    But it works because it does not work according to classical physics but according to quantum mechanics. And those laws are not completely understood yet so who knows what else is possible?

                    So quit whining about resource limitations. What we are lacking is a faith in justice:

                    “I, wisdom, dwell with prudence,
                    And I find knowledge and discretion.
                    “The fear of the Lord is to hate evil;
                    Pride and arrogance and the evil way
                    And the perverted mouth, I hate.
                    “Counsel is mine and sound wisdom;
                    I am understanding, power is mine.
                    “By me kings reign,
                    And rulers decree justice.
                    “By me princes rule, and nobles,
                    All who judge rightly.

                    “I love those who love me;
                    And those who diligently seek me will find me.
                    “Riches and honor are with me,
                    Enduring wealth and righteousness.
                    “My fruit is better than gold, even pure gold,
                    And my yield better than choicest silver.
                    “I walk in the way of righteousness,
                    In the midst of the paths of justice,
                    To endow those who love me with wealth,
                    That I may fill their treasuries.
                    Proverbs 8:12-21

                    So if Progressives want to rule and quit being bluffed by Religious Right hypocrites then crack open those dusty Bibles that your ancestors probably revered and get equiped.

                    You do know that worthy Christians will be co-rulers with Christ? So why not put that desire for power to good use?

                    1. The Dork of Cork

                      “Faith in justice…………”

                      I don’t even know what that means now – my world is in a spin.

                      We will be waiting a long time for a fiat king to come around the block.
                      You just don’t get the power of the financial class which has blighted these islands for hundreds of years now.

                      starts at 3.15 -5.35

                      The pillage is as regular as clockwork – it works over 30 year and 300 year cycles.

                    2. F. Beard

                      You just don’t get the power of the financial class which has blighted these islands for hundreds of years now.

                      I’ve learned enough in the past 5 years of (almost) daily Bible reading and various WEB sites and books that it is almost entirely bluff.

                      The main problem is how can we distribute new fiat to the population without causing price inflation? Steve Keen’s solution is his “A Modern Debt Jubilee”. Nearly the same solution came to me when I work up one morning in 2008 or so independently.

                      And who in the world besides an evil few are going to object to getting chunks of inflation-free fiat to help payoff their debts or to honestly lend?

                      We are being bluffed by shadows.

                  2. The Dork of Cork

                    What if it goes deeper then monetary and energy control : what if our very language we use is at the nexus of our understanding..

                    And is it a complete understanding ? and if not a complete understanding is it a mechanism of control.


                    Read the English language translation of “20 years a growing” if you have no understanding of the Irish language.

                    The very syntax of the language is very different as it is a sympathetic translation – it enables you to think very differently…perhaps out minds have been wraped by a overuse of logic.
                    A narrow focus on this and a abandonment of common sense.

                    The entire world is becoming a King James bible – a cracking read but something very dark also.

                    Perhaps protestant like accumulation has reached its apex…..its impossible anyhow as when we all become protestant there can be no demand.

                    1. F. Beard

                      Please don’t blame the Bible just because Calvin misunderstood it. I only realized that common stock is the IDEAL private money form because I took the Bible seriously. How’s that for practical application? And restitution for theft is REQUIRED by the Bible. And land reform. And debt forgiveness. So what if people got stoned (Did any in fact ever get stoned?) for committing sodomy in public? Don’t some people throw rocks at dogs for not having the decency to do it in private?

                      Progressives have been conned into abandoning the Old Testament. The loss has been incredible.

                    2. The Dork of Cork

                      High order Masons and the nice Jewish bloke gets rolled out to tell us whats what…….people accept what they have to say.

                      It seems to be the way of the world today.
                      As long as they can keep paying the nice but dim lower order mason enough credit the system will roll on and on and on.

                      Remember the typical church of Ireland bloke of the 1820s simply wanted his tithes so that he could have enough free time to do whatever to whomever.
                      They simply did not understand it was not the fault of the agrarian masses for rebelling so they blamed them for the violence which followed.
                      What simply happened was that the money stock was reduced so that the banking system could scale up yet again.

                      To be honest beard I think you are 200 years too late – Christendom is so over.

                    3. F. Beard

                      The Truth is never over. Christ and worthy Christians shall rule over the Earth. But how many shall have been reduced to ashes in the process?

                      The irony is that the big reduction in population that many hope for IS coming but may well include them.

                      Late? My initial concern was ONLY ethical money creation. I thought surely everyone can agree with “Thou shall not steal.” Boy was I wrong!

                      Isaiah 65

  4. The Dork of Cork

    “The UK’s trade performance since the onset of the economic downturn in 2008 has been one of the
    more curious developments in the UK economy. Despite a substantial depreciation in the value of
    sterling, which in theory should have enhanced the UK’s competitiveness, the performance of UK
    trade has been relatively modest.
    Between Q3 2007 and Q1 2009, the sterling effective exchange rate – which captures the change in
    the value of sterling relative to the currencies of UK’s trading partners – declined by more than 25%.
    However, the balance of trade on goods and services (see note 1) – the value of a country’s exports
    less the value of its imports – was broadly unchanged both during and following the depreciation”

    If the economies of the euro area collapse England does not have to waste energy exporting finished goods to gain access to primary goods.
    The demand for its exports will not be available and primary goods not burned in Euroland will flow to the UK.

    We are seeing a crisis in the production of primary goods – everything else orbits around this central fact.
    This is why the value added entrepot euro economy has collapsed.
    To maintain the present system the owners have cut off the hands (greece) and feet ((Spain) but have not changed the fundamentals of the economic system………value added goods must flow to England as there is almost zero local production…..all it has is services.

  5. NotTimothyGeithner

    I don’t how Europe can proceed. Short of enlightenment shining over Germany (hahaha) and folks just workin’ together (I would bet on the Germans before childish delusions), Europe is having a constitutional crisis even if they don’t acknowledge it, and Europe lacks a way to promote a national platform. Elections matter.

    The U.S. and France* have had rapid and peaceful constitutional adjustments, but in both cases, they had men of standing who had to be acknowledged when they spoke (De Gaulle,; Hamilton and Madison, former lackeys of Washington during the war so they weren’t the average politicos). Yeltsin was a big deal in Russia, but he didn’t lead the whole former USSR just his sector (Russia). His “equals” took over their sectors.

    *Algiers may have had representation, but lets be honest, it was a colony.

  6. Europe still have hope

    This democracy aint gonna work as long people are dumb as a doorknops. People have really voted those people in power at Spain and elsewhere – year after year, so whos fault is this? Its just truth that people wont be that smart collectively. Now things will hopefully change and people can find out why eurozone went how it went.

    We should finally learn something from history and create a world that we want, not just be ignorance and let some fools rule the world\EU

    New European parliament wont gonna make such a big change alone, but after next round of national parliament elections there might blow new winds, if not, then we can shovel dirt over Europe and see it in flames once again.

    Almost only solution is to start finance countries threw ECB and get this money to those who need it most. I wont be too hopeful, that this will work in few developing countries, if you dont earmark the bills.

    Last week European policymakers hit their heads together once again, cause Ukrainian didnt wanna start consultation with us about being part of this fantastic experiment. Policymakers came to a conclusion, that we shouldnt demand any political changes from countries, who wanna join EU. How dumb conclusion is that. Not that all member states are such a good example themselves, but please. I want at least some class. Soon we have all mass murderers on board and that aint gonna be ship where I wanna be in.

    So we have to go back in basics and ask why the **** EU exist at a first place? Now only reason seems to be, that few companies can grow bigger and get more revenues, while others die under financial supression.

    Why we have countries at the first place? Aurstalia and USA wont be such a perfect examples themselves either. I think that government should enable same changes for everyone and meet the basic needs – food, water and shelter. This is going right down to drain right now here in Scandinavia, cause libertarians are blaming all this on too big government sector and government need to privatize everything and we will live happily ever after. Well, the problem is ECB and too big surplus for Germany. Media doesnt even touch these topics, cause they dont understand macroeconomics at all. Most dummies are just repeating, that you cant eat more than you have. Well government shouldnt eat from investors hands.

    My conclusion is, that nothing gonna change as long people are dumb. We should civilize people with all the solution that we have. It’s just damn hard, cause media is in fewer and fewer hands.

    We also need agenda for whole globe and stop that psychopathic approach, what Kissinger and others had, that if I cant profit from you, I dumb you. How create world would be, if everyone would do like that?

  7. dearieme

    The British eurosceptics have been proven right. Although their first priority was always to get the UK out of the EU, they were no petty nationalists; they were also aghast at the damage the EU was doing, or would do, to other countries. Let Denmark be Denmark, let Portugal be Portugal, and so on; you can be keen to advance your own interests while still wishing well to your friends and neighbours.

    Euroscepticism = enlightened self-interest.

    I hope that the awfulness of the design and operation of the EU will not preclude there ever being an intelligent, liberal Europe-wide free-trade organisation, but I wouldn’t bet on it. If ever there is, its administrative centre had better not be on the continent: Reykjavík, Belfast, somewhere like that, would be better.

  8. The Dork of Cork

    Contrast the use of Icelandic Diesel ( a fuel in the past used to do work) with Irish Diesel.

    Iceland is a country of primary goods production.
    Ireland is not…..its a conduit country where the Euro core pays Ireland credit (which is then subsequently used to buy European added value goods) to extract its primary goods such as Fish which has been outsourced like the rest of the economy.

    Icelandic TFC Diesel consumption Y2011 : 266Ktoe
    Of which
    Fishing and Agriculture : 125
    Industry : 27

    Road : 106
    Residential : 2

    So more diesel is used for actual work in the local Icelandic economy then in road transport which is typically dominated by high end European value added goods.

    Now lets look at Ireland which is on the extreme end of European conduit banking activities.
    Agriculture : 221 ktoe
    Fishing not incl in the IEAs energy stats publication but is now typically about 20 to 30 KToe per year.
    So lets assume a total of 250 Ktoe

    Industry : 132 Ktoe

    So lets look at diesel consumption in transport
    Total transport : 2,227 ktoe !!!!
    Of which road : : 2,186
    rail : 40

    You can see from these figures that domestic Irish industry does not exist.
    It does not supply either the local or wider UK market as before.

    The Irish now cannot afford to buy the industrial products of Euroland.
    The production , distribution and consumption system has clearly broken down.
    All data is taken from the Yearly IEA energy stats of OECD countries.

    The domestic residential heating market is even more dramatic given the almost total lack of fossil fuel burning in the Icelandic residential area and the heavy use of external fuel oil in the home heating market of Ireland.
    But the above figures are enough for now.

  9. Cassiodorus

    It’s high time for an end to the capitalist system, is what it is. Austerity is merely the profit-mongering du jour of today’s reigning European capitalists.

      1. susan the other

        Capitalism only makes sense in an expanding, growing economy. When the underlying economy sputters to an end capitalism, by definition, cannot work. It can dash around the world when the end is obviious and “invest” in assets it thinks will be productive; but then you gotta toss in global warming and mix thoroughly. It is always possible that todays capitalists have seen the light and they are buying up the world’s future productive assets just to control them. If that is the case the EU should embrace QE for the duration. And some of it should trickle down to Spain and Greece.

        1. Cassiodorus

          Right — the capitalist system appears to have a finite “life-cycle” and is headed toward the end of that lifecycle, toward its terminal crisis…

  10. Peter Pan

    Surely the EU must be doing quite well. The evidence is in the rioting protests of Ukrainian nationalists that want Ukraine to be an EU member. If that ultimately happens they’ll discover that they should’ve been more careful in what they wished for since they may just get it.

    Keep in mind that the southern and eastern parts of Ukraine consist of people whose native language is Russian and tend to embrace Russian culture. They are certainly not Ukrainian nationalists. Look at the maps in the following post:

  11. Hugh

    It’s time to pull the plug on kleptocracy and Europe’s corrupt political classes. The reason these political classes persist in policies that throw ordinary Europeans into poverty and depression is because these policies serve the interests of the local kleptocratic elites. As we see in the US, disaster increases the power of the kleptocratic rich and the inequality in wealth between them and the rest of the population. What is awful for Europe’s 99%s is good for its 1%s. The political classes work for these 1%s and unsurprisingly do their bidding.

  12. Oregoncharles

    “The Germans seem to be obsessed with the ECB providing an ideal monetary policy for them at the cost of others. Since the inception of the financial crisis the ECB and EU have obsequiously been following the German dictate, however with horrendous consequences.”

    Austerity in the EU sounds more and more like the prelude to WWII – indeed, like the period when Germany had conquered the whole area. Is Europe approaching the point where only an uprising by the other countries can save them from the Germans?

    And is Europe once again working up to a war?

  13. The Dork of Cork

    All is not as it seems – remember you could cash a Sterling cheque in Berlin up to 1916.

    War is a racket.
    I grew up being sceptical of Devs achievements given the hardship people had to endure but at least with the economic war over in the 1930s he had enough clout to keep us out of round II of that double Keynesian experiment.

    They now destroy capital via the neo Keynesian pushes of so called sov UK and US (which are really just mature versions of the euroland experiment) and the free banking zone of Euroland but replace tanks ,airplanes and people destroyed with houses cars and people and its pretty much the same thing underneath it all.

    Its a terrible hopeless world we live in.

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