After an extended stay on the Continent, the Mayor has a better picture of the situation among the 27 member countries of the European Union, formerly the Common Market. This economic union, in its 13th year, is experiencing some growing pains. Design flaws have become apparent to all members and to other world trading partners.
While reading several daily papers from around the union(Italy, Germany, UK, Spain, and the NYTimes), it is apparent that the crisis has more roots in politics than economics. The view from the northern countries(Germany, Benelux, Swiss, Scandinavia) is that their southern neighbors have been engaged in profligate spending, contrary to the EU rules. Greece, a country of 10 millions, is only the canary in the coal mine. Other member states, France, Spain, Italy, Portugal, etc. have the same issues times 5, at least. The largest economies of Spain, France, and Italy, can hardly be "bailed" out. The Germans, under Angela Merkel, do not want their Euros sent south.
What to do? Politicians can hardly recommend austerity in the face of high unemployment and an ongoing recession. 11 national leaders have already been replaced, and more are on the way. Conditions in the UK and Russia do not indicate solutions from their markets. Voters, meanwhile, have been stymied in their efforts to find leaders who can provide solutions. The least worse alternative has given rise to the radical, or left leaning representative. This often happens during hard times for the economy.
Where will it end? Will the Euro survive? Will Greece go it alone? Can Greece survive at all? Who's next to get bailed out? Will Spain endure more pain(26% rate of unemployment)? Will Italy have to pay higher bond interest? These are a few of the current questions.
More Later
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