Eu in trouble

[Gob]

Europe, the source of the Enlightenment, the birthplace of modern science, is in crisis.

This part of the world, which hosted the Industrial Revolution that led to unprecedented changes in standards of living in the past two centuries, has been experiencing a long period of near-stagnation. GDP per capita (adjusted for inflation) for the eurozone – the countries of Europe that share the euro as their currency – was estimated to be barely higher in 2015 than it was in 2007. Some countries have been in depression for years.

When the US unemployment rate hit 10% in October 2009, most Americans thought that was intolerable. It has since declined to less than 5%. Yet the unemployment rate in the eurozone reached 10% in 2009 as well, and has been stuck in double digits ever since. On average, more than one out of five young people in the labour force are unemployed, but in the worst-hit crisis countries, almost one out of two looking for work can’t find jobs. Dry statistics about youth unemployment carry in them the dashed dreams and aspirations of millions of young Europeans, many of whom have worked and studied hard. They tell us about families split apart, as those who can leave emigrate from their country in search of work. They presage a European future with lower growth and living standards, perhaps for decades to come.

These economic facts have, in turn, deep political ramifications. The foundations of post-cold war Europe are being shaken. Parties of the extreme right and left and others advocating the breakup of their nation-states, especially in Spain but even in Italy, are ascendant, and in June Britain voted to leave Europe altogether. What had seemed inevitable in the arc of history – the formation of nation-states in the 19th century – is now being questioned. Questions are arising, too, about the great achievement of post-second world war Europe – the creation of the European Union.

While there are many factors contributing to Europe’s travails, there is one underlying mistake: the creation of the single currency, the euro. Or, more precisely, the creation of a single currency without establishing a set of institutions that enabled a region of Europe’s diversity to function effectively.

Continues here...

[oldr_n_wsr]

the creation of a single currency without establishing a set of institutions that enabled a region of Europe’s diversity to function effectively.

Sounds like they need yet another institution to make even more rules.
Brexit. That's what every nation needs.

[MajGenl.Meade]

What can you expect of a group that phonetically = eeeyew!

[dales]

As long as they stay in Europe (and not come to the US) that is a good thing!

[rubato]

There has been a nice little cottage industry in the nutball Religious right in the US bringing out a new apocalyptic theory every few years which says: "America is just like Rome before its collapse" and pointing to various signs of moral decay like reducing the savagery with which homosexuals are treated, civil rights for blacks are really due to COMMUNIST INFILTRATORS, or the like. They use the same form of 'reasoning' we see above.

There are always stressors and difficulties to overcome by all societies at all times in history. The reward for success in solving a problem is having to deal with the next one. And no matter how great was the problem solved the remaining one will loom larger and larger as memory of the old one fades. We used to expect infectious disease to kill a large percentage of children, now "magically" we expect most children to survive infancy. As if it was never different.

So when I see this kind of thing I have to ask: is this more than the past 1000 iterations of hysterical horseshit? Not this time.

The EU solved a lot of problems and has been crucial in the success of the Western Democracies vs totalitarianism. No one but a fool ever thought it would eliminate all problems or that the solution would come without cost.


Success means surviving and thriving to meet new challenges.


yrs,
rubato

[MajGenl.Meade]

Interesting interview on PBS today with Mary Beard, author of SPQR: A History of Ancient Rome. She was most dismissive of the entire school of thought that moral decay was the cause of Rome's fall (even aside from the fact that the Eastern Roman empire did not "fall" until the mid 15th century).

I know that wasn't your point, rubato. Just thought it was worth mentioning.

[Lord Jim]

Well, you have a "currency" supported by every economy from the Germans to the Greeks...

What could go wrong?

The fact of the matter is, the "Euro" is only as strong as the German economy is...it's a sort of international "Deutsche Mark" ...

Every other participant in "the Euro" (including the French) are living off that value...

[Gob]

Thank god we never signed away the pound sterling.

[Lord Jim]

The EU NATO solved a lot of problems and has been crucial in the success of the Western Democracies vs totalitarianism.

Edited for accuracy.

[Gob]

Lost without our money obvs.

Germany's vice-chancellor has warned the future of the EU could be in doubt if the UK's exit is handled badly.

Sigmar Gabriel said the EU would go "down the drain" if other states followed Britain's lead and that the UK could not keep the "nice things" about Europe while taking no responsibility.

It comes as Theresa May summoned ministers for a meeting on Wednesday to discuss ideas for the UK's withdrawal.

Downing Street said Brexit was "top" of the prime minister's agenda.

But a report in The Sunday Times suggested her cabinet was split over leaving the single market.

The UK voted to leave the European Union in a referendum vote on 23 June.

Mr Gabriel, who is also economy minister in Germany's governing coalition and Chancellor Angela Merkel's deputy, told a news conference that as a result, the world now regarded Europe as an unstable continent.

[Guinevere]

Interesting interview on PBS today with Mary Beard, author of SPQR: A History of Ancient Rome. She was most dismissive of the entire school of thought that moral decay was the cause of Rome's fall (even aside from the fact that the Eastern Roman empire did not "fall" until the mid 15th century).

I know that wasn't your point, rubato. Just thought it was worth mentioning.

Both my Swede and I SPQR late last winter. Neither of us found it terribly enjoyable and her theories are not well articulated. The book was really kind of a mess, but she does seem to want to draw parallels between the stalemate in the US Congress, the rise of demogaugury, and the decline of the Romans. At least that's what I could get out of it.

Damned feminista conned me into buying that book, too. Ugh.

[MajGenl.Meade]

I'll wait for the library to get it.

Those demonstrations of railway lines!

[Gob]

Merkel's getting a message.

Angela Merkel's ruling CDU party has been beaten into third place by an anti-immigrant and anti-Islam party in elections in a north-eastern German state, partial results have shown.

The Alternative fuer Deutschland (AfD) party took about 21% of the vote behind the centre-left SPD's 30%.

The German chancellor's CDU was backed by only about 19% of those who voted, according to the partial results.

The vote was seen as a key test before German parliamentary elections in 2017.

Before the vote in Mecklenburg-West Pomerania, in the former East Germany, all of Germany's other parties ruled out forming a governing coalition with the AfD.

The AfD, initially an anti-euro party, has enjoyed a rapid rise as the party of choice for voters dismayed by Mrs Merkel's policy.

[Gob]

and another....

Berlin is likely to get the first leftwing triple-coalition government in its history, after Angela Merkel’s CDU party and the ruling Social Democrats both plummeted to their lowest result in the Germany capital.

Centre-left Social Democrats (SPD) came out top with 21.6% of the vote, ahead of the centre-right Christian Democratic Union (CDU) on 17.5%. Leftwing Die Linke came third on 15.7%, ahead of the Greens on 15.1%.

Anti-immigration populists Alternative für Deutschland are set to enter the German capital’s state parliament for the first time, with 14.1%.

[Gob]

Here we go again. Financial markets fretting about the health of eurozone banks.

What is different this time is that the outbreak is centred on the biggest bank in Europe's biggest economy. For decades, Deutsche Bank worked hand in glove with the mighty Bundesbank to prudently finance the German economic miracle.

In the 1990s it became a serious global bank, competing toe to toe around the world with the likes of JP Morgan and Goldman Sachs. But just a few weeks ago, the IMF said that of all the banks big enough to bring the financial system crashing down, Deutsche Bank was the riskiest.

The bank was forced to deny it had sought government help, its share price has collapsed and this giant of world banking is currently worth half as much as Airbnb.

What happened?

Like all banks - it was laid low by the financial crisis and the ultra low interest rates that followed. Profit margins and lending volumes are thin in a sluggish European economy.

But unlike the big US banks and, belatedly, RBS, it did not take an axe to its loan book. It still has €1.6 trillion ($1.79 trillion; £1.38 trillion) of loans outstanding. Only a small percentage of them need to go bad to wipe out the €60bn it has in capital.

It is also facing a whopping fine from US financial authorities for selling risky mortgages. The $14bn demand is likely to be negotiated down but even if it is half that figure, Deutsche Bank will have to raise money.

[Gob]

More woes for the EU.

Hungary is set to vote in a referendum on whether to accept mandatory EU quotas for relocating migrants.

Right-wing Prime Minister Viktor Orban opposes plans to relocate a total of 160,000 migrants across the bloc.

Under the scheme, announced after last year's migrant crisis, Hungary would receive 1,294 asylum seekers.

Opinion polls suggest strong support for a rejection among those who say they will vote. To be valid, turnout needs to be over 50% of voters.

During the migrant crisis, Hungary became a transit state on the Western Balkan route to Germany and other EU destinations.

In an effort to curb the influx, it sealed its border with Serbia and Croatia. The measure was popular at home but criticised by human rights groups.

Voters will be asked: "Do you want the European Union to be able to mandate the obligatory resettlement of non-Hungarian citizens into Hungary even without the approval of the National Assembly?"

Mr Orban has previously described the quotas as "illegal and unreasonable"

In December Hungary filed a court challenge against the EU plan, which would see relocations over two years.

In a TV interview on Thursday, Mr Orban said: "If there are more 'no' votes than 'yes' votes, that means Hungarians do not accept the rule which the bureaucrats of the European Commission want to forcefully impose on us."

[Scooter]

Or maybe not, as it appears that most Hungarians did not care enough about the issue to vote, which would invalidate the result.

Under the original proposal, 54,000 migrants would have been removed from Hungary and resettled in the recipient countries. But Hungary rejected that arrangement; for reasons I do not quite understand, it does not like being grouped with Italy and Greece as "front-line" countries in the migrant crisis. So that 54,000 will be used to resettle more migrants out of Greece and Italy, and Hungary was allocated its share (more of a guideline than a quota, subject to all sorts of qualifications on a country's capability to receive them. The countries objecting the strongest have been allocated only token numbers for resettlement. The notion that Hungary could not manage a resettlement of 1200 people over two years is laughable.

Apparently the Hungarian president doesn't really have any objections to this "one-off" mandated resettlement, as the referendum is only intended to apply to "systemic" changes that could involve the resettlement of "millions" of people.

It appears to be one giant attempt to cut off their nose to spite their face, in order to make a "statement" about national sovereignty.

Theresa May did not disappoint either, in her entirely predictable response. The UK had the right to refuse to particpate in any case; so she didn't need to invent an excuse. To parrot the platitude that refugees are to seek the protection of the first safe country they reach is to continue to foist the bulk of the burden on Italy and Greece and absolve the rest of Europe of almost all responsibility. And then, having done so, she whines that economic migrants are not being identified and removed fast enough.. Well gee, I'm not sure, but if some of the hundreds of thousands of migrants overwhelming a handful of countries could be resettled in other countries, who would process the refugee claims of their respective settlers, those refugee claims could be assessed much faster and economic migrants identified more quickly.

There would remain the problem of where to send them; Turkey is the only viable option approaching (barely) a safe country, and they will agree to take the rejected claimants, for a price TBD, Any difficulties in removing them still doesn't justify refusing to take ownership of the untenable situation in Greece and Italy.

The answer is always "strengthen the external borders", but that is next to meaningless when the remaining route to safety is across the water. Do they propose, like Trump, building a wall through the middle of the Mediterranean?

The Italian PM has been referring to an ambiguous Plan B for months now. It may involve greeting every arriving migrant with a 90 day Schengen visa and a train ticket to any European destination of their choice. I suspect a few countries would quickly see the wisdom of what in comparison will look like very modest quotas.

[Econoline]

The Italian PM has been referring to an ambiguous Plan B for months now.

"Plan B: have fun, relax, but above all ARGUE!"...works for me...