Posted on 05/15/2012 8:50:18 PM PDT by MinorityRepublican
IT MAY ALREADY be too late to prevent Greece from defaulting on its debts and leaving the euro, Europe’s common currency. But there still may be time to prevent Greece’s woes from dragging down the rest of Europe, and the world. For that to happen, though, Europe’s leaders must think clearly about the issues before them, especially the great “austerity vs. growth” debate.
When European and, indeed, U.S. critics condemn austerity, what they usually have in mind is the combination of tax hikes, spending cuts and structural reforms that Germany and other surplus-earning countries in the northern half of the continent, as well as the International Monetary Fund (IMF), are imposing on the debtors in the south, in return for financial support.
In their demand for growth, however, the critics fail to explain how to fund it. Countries such as Spain, Italy and Portugal have lost credibility in global bond markets — and competitiveness in the global market for goods and services. Under any reasonable scenario, even one in which Germany and the IMF relaxed deficit-reduction targets, these countries would still have to shed wasteful government programs, improve tax compliance and, most of all, make their labor markets more flexible.
What deserves more attention is the threat to Europe from austerity in the surplus countries. Despite its super-competitiveness with respect to its neighbors, Germany (and, to a lesser extent, the Netherlands) continues to slash budget deficits and restrain wages. Between 2008 and 2011, Spain cut unit labor costs by 8.5 percent, compared with the rest of Europe. That’s great — until you consider that Germany also cut its labor costs by almost 2 percent, maintaining its wide lead over everyone else.
(Excerpt) Read more at washingtonpost.com ...
Spain cut it’s labor costs by shippng it’s labor to Germany; their government is actively urging them to go, and Germany is willing to take them as long as they have a skill and speak German.
Lighten up, we’re only driving over a cliff, no worries.
So what if its a thousand foot dive into a foot of water, lighten up dude.
That’s right — let’s just all spend more and have a great party! Surely that is the way out of the crisis!
Hey, the Mafia wants that money you owe them.
— Nah, I just bet it all on a horse, it’s 15-1 but its a sure thing.
You are nuts, you are seriously going to die.
— Lighten up, what’s the worst that could happen?
That's just pathetic.
Besides, if Germany reduces it’s spending and deficit, it makes Zero look bad. So Germany should throw a party. And Zero should keep the party going. Classic ruling class BS. Whoopee!!
The bitter truth is that deficit spending squanders capital, results in unsustainable debt and leads to poverty. Bankruptcy is more than an abstraction or some benign “chapter nine” experience. Financial gimmicks can never restore prosperity. If austerity is rejected by the Greeks, Italians, Spaniards and French, their ability to import the fuel, food, manufactured and electronic goods that make modern living possible will be severely limited. Things will get ugly. The Germans would be wise not to fund more futile bailouts but to get their non essential personnel out of those countries.
We face total economic meltdown. Financial Armageddon.... but LIGHTEN UP.
lol
Hey Washington Post, your losses are staggering, your readership is dwindling, your credibility is shot and you are the verge of extinction.... but LIGHTEN UP.
To the people of Europe... you have been robbed and mocked by your own governments. but LIGHTEN UP.
Lighten up dude, it’s only money. lol.
We can use this ‘lighten up’ thing to mock them mercilessly.
LOL!
Germany is the problem? LOL!
The article contains a link to a celebrated buffoon-
Eugene Robinson
Opinion Writer
Austerity as a bridge to nowhere
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The Takers and the MSM are attempting to again change the connotation of words.
Gov’t participation = Economic growth
Homosexual = gay (AIDS & anal condylomata be damned)
Lighten Up, Francois.
The World’s Biggest Debtor Nations
Northern Europe is a zombie (Sweden, Netherlands, Finland). Germany is at 184% of GDP, the UK @ 451%, and Ireland, the former darling of the PIGS, is at 1,240% of their GDP!!! YIKES!!!
It's ugly and will only get worse, even with a regime change because the host is D...E...A..D...
Huh...??? They top 200% + of their GDP in spending, and SPENDING CONTINUES TO GO UP".
But we don't need no skinkin' facts...
Now that Obama, with the support of the NY Times and the Washington Post, has saved the American economy by printing Monopoly money for 3 1/2 years the Post feels that the most successful economy in Europe should follow us down the drain.
It’s actually the essence of socialism.All the high nails get hammered down.
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