Can European Union (EU) survive this voter backlash in two of most powerful countries.. First one (France) has real economic clout and power to change the destiny of EU. Second (Greece) is powerful due to the super mess of economic mismanagement created by its own government.
On one hand we have Germany, who has really gained in last decade after surviving brutal losses earlier from re-unification. Some say that Germany did gained at the expense of rest of the Europe... Though I disagree with this theory and strongly believe every nation has their own destiny in their own hand. You can't blame other country or regime for your own losses. Germany did well due to hard work and sacrifices they made after re-unification. I still remember during 2003-4 time frame reading multiple reports on Germany's problems and ticking time bomb about retiree's obligation on pension system and so on.. They were all suppose to kick in by 2010 or so.. and here we are in 2012, Germany, one of the most strong Nation on other side of the pond. Why? I think, answer is simple, Germany did well due to sacrifice and hard work. They cut corners in every area and continued momentum for Euro Zone which gave them great market to explore and expand their market share.
Where as Greece is classic example of Old, Corrupt society which has totally become dysfunctional and encourages spending more and paying minimal or zero tax. Good thing for them was that the mess hey created was too big to fail category which mandates rescue from EU. Despite abundant natural resources and great tourism place they flunked..
However, Election results in France is another classic example of what should be done to put decently running government out and almost selecting a non functional Greece style government. The kind of policies new government is talking about is going to make France another Greece. 75% top tax bracket!!!! Mera Bharat Mahan!!! These type of things are going to make one perfectly fine working government into totally dysfunctional government. Problem is nobody can save France.. France is so big that EU is relatively small in case of they even think about Greece style bailout.. Though very unlikely... but this new government has shaken confidence in EU.
Germany is driving all these austerity measures for their own good.. For them, most important thing is preservation of the market.. EU gives German companies a unified and great market.. it is like China.. US is biggest market for China.. so like China, Germany will do whatever it takes to preserve their market.. they know that if EU goes away, their critical market goes away.. and so does all the prosperity.. First they tried to lend as much they could to sustain their markets.. When it didn't worked, they simply started acting like IMF and started imposing austerity measures. which for the time being is taking these countries further south.. So obviously, there is backlash from common man in these respective countries..
I thing it is going to be tough for EU to sustain these losses.. and I feel it will be better that they go back to their old style.. We are seeing more problems than solutions due to EU thingy.. Earlier, each country had its own destination in their hand.. now.. it is tied to rest of the gang as well. It is like communist theory or I should say.. CU (Communist Union) or CNO (Communist Nation Org) instead of EU and UNO respectively..
In France, Greece, voters reject backers of austerity
Results challenge German vision for economic reform
By Steve Erlanger
New York Times
PARIS — Francois Hollande defeated President Nicolas Sarkozy on Sunday, becoming the first Socialist elected president of France since Francois Mitterrand. Meanwhile, in Greece, voters punished those responsible for severe austerity measures.
Hollande campaigned on a more inclusive France, but his victory will also be seen as a challenge to the Germandominated vision of economic austerity, also supported by Sarkozy, as a way out of the euro crisis. Both Hollande and Sarkozy had promised to balance the budget in the next five years. Sarkozy became the latest European leader to lose his post amid economic upheaval and the first French incumbent to be rejected since 1981. Furious Greeks punished the two parties that have dominated politics for decades in the crisis-battered country, leaving its multibillion dollar international bailout — and even its future in the euro currency — hanging in the balance. With nearly 80 percent of the vote counted, Greece appeared to be heading toward political stalemate. Nobody won enough votes to form a government, and the two parties that backed the bailout — the conservative New Democracy and socialist PASOK — conceded they need to win over adversaries to form a viable coalition.
“I understand the rage of the people, but our party will not leave Greece ungoverned,” said New Democracy leader Antonis Samaras.
New Democracy was leading with nearly 20 percent of the vote, which would give it 111 seats in the 300-member parliament. PASOK, which has spent 21 years in government since 1981 and stormed to victory with more than 43 percent in 2009, saw its support slashed to 13.5 percent. It will have 42 seats, compared with 160 in the last election.
In France, the race between economic adjustment to reduce debt and democratic anger is proving complicated, and Hollande has demanded that a European Union treaty limiting debt be expanded to include measures to produce economic growth. Domestically, he has promised to raise taxes on big corporations and raise the tax rate to 75 percent for those earning more than 1 million euros a year.
Calling his victory “a fresh start,” Hollande pronounced: “Austerity need not be Europe’s fate.”
The vote was viewed as a rejection of Sarkozy and his relentless effort to appeal to voters of the far-right National Front party.
With 95 percent of the vote counted, official results showed Hollande with 51.6 percent of the vote while Sarkozy, of the center-right Union for a Popular Movement, had 48.4 percent, The Associated Press said. After weeks of energetic and sometimes bellicose campaigning, Sarkozy was gracious in defeat. “Francois Hollande is the president of the republic, he must be respected,” Sarkozy said after calling Hollande to congratulate him. “I want to wish him good luck in the midst of these tests.”
The Associated Press contributed to this report.
CHRISTOPHE ENA/ASSOCIATED PRESS
ERIC FEFERBERG/AFP VIA GETTY IMAGES
President-elect Francois Hollande, left, in Tulle after his win. Nicolas Sarkozy, right, addresses supporters in Paris.
On one hand we have Germany, who has really gained in last decade after surviving brutal losses earlier from re-unification. Some say that Germany did gained at the expense of rest of the Europe... Though I disagree with this theory and strongly believe every nation has their own destiny in their own hand. You can't blame other country or regime for your own losses. Germany did well due to hard work and sacrifices they made after re-unification. I still remember during 2003-4 time frame reading multiple reports on Germany's problems and ticking time bomb about retiree's obligation on pension system and so on.. They were all suppose to kick in by 2010 or so.. and here we are in 2012, Germany, one of the most strong Nation on other side of the pond. Why? I think, answer is simple, Germany did well due to sacrifice and hard work. They cut corners in every area and continued momentum for Euro Zone which gave them great market to explore and expand their market share.
Where as Greece is classic example of Old, Corrupt society which has totally become dysfunctional and encourages spending more and paying minimal or zero tax. Good thing for them was that the mess hey created was too big to fail category which mandates rescue from EU. Despite abundant natural resources and great tourism place they flunked..
However, Election results in France is another classic example of what should be done to put decently running government out and almost selecting a non functional Greece style government. The kind of policies new government is talking about is going to make France another Greece. 75% top tax bracket!!!! Mera Bharat Mahan!!! These type of things are going to make one perfectly fine working government into totally dysfunctional government. Problem is nobody can save France.. France is so big that EU is relatively small in case of they even think about Greece style bailout.. Though very unlikely... but this new government has shaken confidence in EU.
Germany is driving all these austerity measures for their own good.. For them, most important thing is preservation of the market.. EU gives German companies a unified and great market.. it is like China.. US is biggest market for China.. so like China, Germany will do whatever it takes to preserve their market.. they know that if EU goes away, their critical market goes away.. and so does all the prosperity.. First they tried to lend as much they could to sustain their markets.. When it didn't worked, they simply started acting like IMF and started imposing austerity measures. which for the time being is taking these countries further south.. So obviously, there is backlash from common man in these respective countries..
I thing it is going to be tough for EU to sustain these losses.. and I feel it will be better that they go back to their old style.. We are seeing more problems than solutions due to EU thingy.. Earlier, each country had its own destination in their hand.. now.. it is tied to rest of the gang as well. It is like communist theory or I should say.. CU (Communist Union) or CNO (Communist Nation Org) instead of EU and UNO respectively..
In France, Greece, voters reject backers of austerity
Results challenge German vision for economic reform
By Steve Erlanger
New York Times
PARIS — Francois Hollande defeated President Nicolas Sarkozy on Sunday, becoming the first Socialist elected president of France since Francois Mitterrand. Meanwhile, in Greece, voters punished those responsible for severe austerity measures.
Hollande campaigned on a more inclusive France, but his victory will also be seen as a challenge to the Germandominated vision of economic austerity, also supported by Sarkozy, as a way out of the euro crisis. Both Hollande and Sarkozy had promised to balance the budget in the next five years. Sarkozy became the latest European leader to lose his post amid economic upheaval and the first French incumbent to be rejected since 1981. Furious Greeks punished the two parties that have dominated politics for decades in the crisis-battered country, leaving its multibillion dollar international bailout — and even its future in the euro currency — hanging in the balance. With nearly 80 percent of the vote counted, Greece appeared to be heading toward political stalemate. Nobody won enough votes to form a government, and the two parties that backed the bailout — the conservative New Democracy and socialist PASOK — conceded they need to win over adversaries to form a viable coalition.
“I understand the rage of the people, but our party will not leave Greece ungoverned,” said New Democracy leader Antonis Samaras.
New Democracy was leading with nearly 20 percent of the vote, which would give it 111 seats in the 300-member parliament. PASOK, which has spent 21 years in government since 1981 and stormed to victory with more than 43 percent in 2009, saw its support slashed to 13.5 percent. It will have 42 seats, compared with 160 in the last election.
In France, the race between economic adjustment to reduce debt and democratic anger is proving complicated, and Hollande has demanded that a European Union treaty limiting debt be expanded to include measures to produce economic growth. Domestically, he has promised to raise taxes on big corporations and raise the tax rate to 75 percent for those earning more than 1 million euros a year.
Calling his victory “a fresh start,” Hollande pronounced: “Austerity need not be Europe’s fate.”
The vote was viewed as a rejection of Sarkozy and his relentless effort to appeal to voters of the far-right National Front party.
With 95 percent of the vote counted, official results showed Hollande with 51.6 percent of the vote while Sarkozy, of the center-right Union for a Popular Movement, had 48.4 percent, The Associated Press said. After weeks of energetic and sometimes bellicose campaigning, Sarkozy was gracious in defeat. “Francois Hollande is the president of the republic, he must be respected,” Sarkozy said after calling Hollande to congratulate him. “I want to wish him good luck in the midst of these tests.”
The Associated Press contributed to this report.
CHRISTOPHE ENA/ASSOCIATED PRESS
ERIC FEFERBERG/AFP VIA GETTY IMAGES
President-elect Francois Hollande, left, in Tulle after his win. Nicolas Sarkozy, right, addresses supporters in Paris.
1 comment:
I don't think EU will split. The EU is dependent on each other. The zone is what prevents them from keeping the money within their zone. Although I do think they will start printing money more easily like the US, UK and Japan.
I think that austerity measures will be a thing of the past soon, till the economic crash. Once that happens, the debt of the countries will evaporate in currency devaluations due to the coming currency wars.
UK is likely to join EU to avoid a hyper-inflationary outcome. Japan is actually pretty sound, inspite of 200%+ debt, due to lots and lots of savers.
The US is unique, there are no savers. They have the largest budget deficit of any country, and they don't have any throttle on public spending. They are not at all likely to head the warning of strong inflation. Because the government is not restricted by inflation, it can print its way out of any inflation. Although it would turn into HI.
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