Ireland is ECB’s sacrifical lamb to satisfy German inflation demands
Put bluntly, Ireland is being forced to roll back the welfare state and tighten fiscal policy in the midst of a savage economic contraction in order to uphold the deflation orthodoxies of Europe’s monetary union.
If Ireland still controlled the levers of economic policy, it would have slashed interest rates to near zero to prevent a property collapse from destroying the banking system.
It would not be tossing away its low-tax Celtic model to scrape together a few tax farthings – supposedly to stop the budget deficit exploding to 13pc of GDP this year, or 18pc says Barclays Capital.
Above all, Ireland would not be the lone member of the OECD club to compound its disaster by slashing child benefit and youth unemployment along with everything else in last week’s “budget from Hell”.
[...]
Spain is already tipping into deflation. Unemployment has reached 3.5m or 15.5pc, and is rising very fast. Finance minister Pedro Solbes – ex-Mr Euro and lately the Torquemada of Madrid life – was toppled last week in a bitter dispute over spending plans. He said the kitty is empty. Quite. But is his fall a sign that Spain is no longer willing to follow the Frankfurt deflation script?
[...]
France too is fraying. The over-valued euro – fruit of ECB doctrine – is hollowing-out core industry. This week ArcelorMittal mothballed its historic foundries in Lorraine in what looks like the final demise of French steel. Workers are taking matters into their own hands everywhere, holding managers hostage in what amounts to low-level terror tactics.
[...]
Unless Germany accepts inflation of 4pc, 5pc or 6pc for a while, the only way the South can claw back lost competitiveness is through outright wage cuts, and that is not a macro-economic option for debtors. Is anybody facing up to this core reality in euroland?…”
Interessant nyhed som jeg godt syntes kunne fremhæves:
“Workers are taking matters into their own hands everywhere, holding managers hostage in what amounts to low-level terror tactics.”
Der har så sent som i går været kæmpedemonstrationer overalt i Frankrig mod præsidentens plan om at hæve pensionsalderen. Officielt 450.000 mennesker på gaden, men flere af arrangørerne siger at tallet nærmere var 2 millioner måske endog 2.5 millioner.
Jeg syntes der de senere år har været en tendens til flere og flere af disse massedemonstrationer i Frankrig.
Kan man tillade sig at håbe på at det er begyndelsen på en ny revolution i Frankrig???
I så fald er den mere nødvendig end nogensinde før og kan forhåbenlig brede sig som ringe i vandet til andre lande…
Kommentar af kenneth — 8. september 2010 @ 10:24
Det er svært at sige noget om. De franske bønder har også flere gange kørt med møgspredere forbi, hvor eliten mødtes og drak Champagne. Det er mere robust, end hvad man kan forestille sig her. Danskerne er nogle skvat.
Jeg bange for vi/vore efterkommere må vente til araberolien begynder for alvor at ophøre, eller der måske kommer mere krig nede i området mod øst (det behøver ikke vare længe). Retorikken p.t. kunne tyde på det er snart, og selv Frankrig er med denne gang “med sidste frist-formaninger til Iran”. Den skal blot i det åbne køres over terror-finansieringen og dermed ikke centralt over evetuelle atombombe-planer.
Kommentar af Therese — 8. september 2010 @ 12:02