Comments on: Europe’s new, suicidal normal Wed, 13 Apr 2016 01:13:45 +0000 hourly 1 By: trevorh Thu, 10 May 2012 20:07:16 +0000 @Acetracy

Based on 2011 numbers. In the US, even if you tax every “single penny” that anyone makes above 250k, you only increase revenue by $800B

Still about $800B deficit!
People repeatedly said it’s about entitlement.

Europe don’t even have that big of luxurious national resources, namely the rich (both the crony rich and the ultra-productive rich). Any idea of redistributing wealth does nothing to the structural problem, only making it larger and kicking the can down the road.

Trickle down economy does not work because the bottom outbreeds the top. (Note that I am not saying the all people currently on the top deserve to be there)

No, zip, nil, nada economic system works when the unproductive and takers outbreed the productive and contributors. It seems to happen at all levels, from global, country, regional, to within ethnic groups.

Please educate me if I get the number wrong.

By: Acetracy Thu, 10 May 2012 14:35:58 +0000 If Americans and Brits could get off their high horse about mainland Europe, the EEC and the Euro, perhaps there could be intelligent discussion. Let’s not forget which major world economy lost its top credit rating because its Congress couldn’t decide on a debt ceiling – purely as a result of partisan bickering – that country of course is the US – no socialist or communists in that group.

I lived in Europe a good part of my life including Germany, Belgium, Spain and Switzerland. In each of those countries a saw a government that put national infrastructure maintenance and improvement as a top priority versus tax breaks for the wealthy. Military spending is much, much lower than in the US or Britain. Furthermore, education and healthcare didn’t impoverish their middle-class as here in the US.

Greece has always allowed fraud amongst its 1% and political class. Even its first king after independence from the Ottomans quit and went back to Germany – disgusted with the internal fights and frauds. Greece, unlike Spain, Ireland and Italy, never developed a real economy that didn’t rely on subsidies from its neighbors. This isn’t a fault of the Greeks per se, but of a ruling class that has squandered billions while fattening their own pocket. Don’t forget, some of the richest families in the world are Greek. Where are they in supporting their country?

THe fiscal crisis in most countries would be resolved by making the rich, and esp. the off-shore super rich (1/3 of the world’s wealth is held off-shore, untaxed) pay their fair share of taxes – like 50% of their income and 5% of the net worth ANNUALLY. Look at the taxes the US middle-class pay and you see why 75% of the baby boomers have less than $10000 saved for their retirement.

Let’s stop demonizing Europe which at least isn’t wasting their politicians’ time debating gay marriage, abortion, school prayer and birth certificates.

By: usagadfly Wed, 09 May 2012 17:11:51 +0000 Clearly, “Free Trade” and “globalization” have failed the nations of the West. And equally as clear, the broken corporatist Governments of the West, who think they can “hire” and “fire” citizens at their sole discretion, have failed the peoples of the West.

Failure, failure, failure! And all we hear is how ungrateful we are for being crushed by States that do not respect our ethnic identities nor our concern for helping our own people as opposed to helping strangers we are ordered to help by our corporatist State rulers. What utter nonsense! There is no divine commandment that we must surrender self-government.

What we are seeing, throughout the West, including the USA, is a rebirth of ethnic Nationalism. A rebirth of self-determination for the native peoples of the West. We are dealing with nations, not entitled Kingdoms who can force repugnant policies on their subjects by decree. Time to admit the nearly universal failure of so-called “Capitalist” (crony capitalist) systems. Time to restart how we govern ourselves and who we work for.

By: whyknot Wed, 09 May 2012 13:14:08 +0000 Greece does not have access to the financials markets now nor will they if they leave the Euro. The current debt will never be paid. Can they self support themselves? If not then predict a lot of violence.

By: LoveJoyOne Wed, 09 May 2012 05:46:44 +0000 An obvious solution to this problem would have been possible in the beginning:

Greek public debt could have been written off 100% with the help of the Eurozone and the IMF. At that time, the Eurozone and the IMF could have imposed very strict conditions before any new loans would be granted. Failure to adhere to those terms would have been grounds for forcing Greece to leave the Eurozone.

Such an approach would probably have reduced the total cost of this crisis by hundreds of billions of Euros – perhaps trillions and quickly stemmed the contagion. Confidence in the Euro would have been restored immediately and years of uncertainty avoided.

The Eurozone would have already been on a solid growth path by now.

By: Anonymous Wed, 09 May 2012 04:00:35 +0000 Here’s a better idea. Ditch the euro. How many more years of watching Germany feast on the inherent inequalties of EU nation’s economic capabilities do you think the losing nations will tolerate? And please, enough with the “armageddon will be unleashed” argument. The euro is an unfortunate blip in the history of world currency experiments. Start thinking long-term!!

By: trevorh Wed, 09 May 2012 01:00:13 +0000 @changeling

Holding Euro is thinking long-term.

Breaking it is bad short term because this will not solve the problem. Currency is just a metric for measure. Some people make joke about instead they should be changing each minute each Greek into 2 minutes. That way 8 hours work become 16, tourists staying one night become 2 nights. Revenue will double, debt slashed in half.

The real production capacity, productivity, nothing else changes. Nothing solved at all.

And the real deadly thing here is that things will actually get worse. Isolation reduces trade which reduces consumption (ECO101), thus standard of living will go down even further. Isolation breeds nationalism.

This is where the nationalists can start feeding on people’s anger and despair. It will just accelerate the coming war which is the inevitable child of all nationalist movement. Hollande will fail, and Marine Le Pen is just smartly waiting now, will eventually send him a thank you note.

Having said that I would very much like to see Greece go. Their people want it.

Let’s see what happens next. At worst, they are small enough to be contained, I am sure the toxic papers are mostly with the ECB now. At best their failure will be a stern warning to those who refuse fundamental reform and growing up. In the unlikely case that they can actually do well after that: even better, great!

By: SweeneyT Wed, 09 May 2012 00:34:40 +0000 Great story. We have just had a budget in Australia and we are dubious it will come out close to the forecast. However, we are so much better off than Europe. Why not think of immigrating to this country. Asia is the future and we have a great climate and a stable democracy and quite multicultural.

By: changeling Wed, 09 May 2012 00:17:31 +0000 Here’s a better idea. Ditch the euro. How many more years of watching Germany feast on the inherent inequalties of EU nation’s economic capabilities do you think the losing nations will tolerate? And please, enough with the “armageddon will be unleashed” argument. The euro is an unfortunate blip in the history of world currency experiments. Start thinking long-term!!

By: trevorh Tue, 08 May 2012 22:32:11 +0000 Ok this is the way I see it.

The standard of living for these countries have been high for a while because they used to be very competitive in what they produced.

Remember the time when they produced cars, tv, machinery, airplanes, ships, etc.. that pretty much no one else can produce.
They came to the world market, and the rest of the world was producing tomatoes, potatoes, wheat. Basically things that almost everyone can produce.
They were able to trade a car for example 1000 tons of tomatoes because they can dictate it. This leads to very wealthy countries.

It lasted for a while, because that rest of the world started to learn how to make cars, tv, machinery too. In fact they eventually discovered ways to make better tv, better cars, better machinery. These countries fall behind in economic competitiveness and productivity as well as the quality and cost of what they produce.

It’s inevitable that the standard of living goes down to match the new comparative capability. The world no longer buys their stuff for even let’s say 1 ton of tomatoes, let alone 1000 tons. Then people go unemployed, there is nothing left but low wage job for them. And the wage is low not because of the evil corporation. It’s because too many people can do that job.

Great Depression and WWII scares me every time. WWII solved the problem by making the problem (ie the people) ‘disappear’. The larger the scale, the more deadly and destructive the war, the more comprehensively it ‘solved’ the problem. We don’t want that, yet there are still enough nutjobs today that still want to solve the problem that old way.

Other than lower wage, I don’t see other option. A low paid job is better than no job at all. While we hesitate the nutjobs will just make their voice louder and louder.
Anyone has a better idea?