Inflation and production cost differences cause irreparable financial desequilibrium and cause havoc in Euro zone
Countries with different inflation rates are are bound together into the common Euro currency. No more corrective currency devaluations ! Production cost differences create serious permanent economical and financial imbalances and fan hostility between nations. Germany resents paying and guaranteeing crippling amounts of money, worth several years of federal government budget. Greece resents forced austerity, wage reductions and severe recession. The Euro causes suffering, injustice and resentment among European nations. The Euro should have never been introduced as common currency for economically diverse nations.
Euro breakup scenarios
- The weakest nations need to leave the Euro.
- Or the strongest nations could leave the Euro.
- Or the Euro could split into 2 blocks.
- Or all European nations need to be equalized: Diversity of European Cultures dooms the Euro. Greeks need to work more then Germans, Dutch to spend more then Italians for the Euro to function.
A breakup would be painful. Germany has guaranteed and loaned too much. Loans are too. The European central bank bought lots of potential default papers, in order to transfer losses from banks to the tax payer.
But every year these loans increase further. Greece, Italy, Spain have become too uncompetitive and indebted. `Germany’s currency is under-valued, salaries are too low, leading to enormous export surpluses.
Coins and bills of Greek, or German currencies would need to be minted, causing serious logistic problems. .
Finland leads the way
The finance minister stressed that Finland, one of only a few EU countries to still enjoy a triple-A credit rating, would not agree to an integration model in which countries were collectively responsible for member states’ debts and risks.
She also insisted that a proposed banking union would not work if it were based on joint liability.
- Euro break-up: Let Germany lead the northern core and France the rest 05 Jul 2012
- German top economists suggest citizens to protest the Euro policy
"We need A Europe of sovereign nations", said General DeGaulle’s
DeGaulle, French hero, general, and ex-president, had the right vision. He wanted collaboration of sovereign nations, not forced equalization of European nations.
De Gaulle’s vision of Europe of sovereign states has become clear at the latest since the failed enforcement attempt of the European defensive community (EVG) 1954: He argued in favour of a Europe of sovereign nations, against supranational Europe. For him the fact that people submit to a majority decision of foreign representatives (“l’aréopage” – areopagus) is synonymous with the danger that one submits to a “fédérateur” (unifier) or hegemon coming from outside who could be able to force the reluctant nations to compliance of foreign decisions.9 […]
De Gaulle saw the opportunities which an independent Europe of the nations would have had between the priorities of tension during the cold war: to be a conciliatory power devoted to peace between the blocks. Today’s world is in urgent need of such a power.
Nevertheless should we not reflect on an alternative? Even if the prophets in the towrope of Monnet repeatedly try to persuade us that there is no other alternative to supranational Europe than a war?
The EFTA, unwanted by the USA, was and is such an alternative: “[…] an own grouping, a small foreign trade zone, in which the sovereign nations worked together on an equal and liberal base with each other.”17 • What would General de Gaulle have said about the European Stability Mechanism?
Germans have paid too much for too long,
and reap nothing but hostility and ungratefulness.
Germany was an organizer of and is by far the largest contributor to the European Financial Stability Facility, which totals a staggering 726 billion euros ($924 billion). That number will rise and, when combined with earlier funds and loans, Germany’s share will easily exceed the country’s total annual federal tax revenues. Imagine the U.S. being willing to guarantee more than $2 trillion to bail out Mexico.
We hear a lot about the German public’s opposition to helping the Southern European countries. What’s remarkable, given the scale of German aid, is how little opposition there is. This month, Parliament will easily ratify a number of these funding mechanisms as well as a new financial-transaction tax to pay for part of this. (The Germans have the old-fashioned, conservative view that if you spend money, you should pay your bills.)
On the other hand, the German demands for austerity are problematic. It seems that there is no just and satisfying solution as long as very different countries are tied to one and the same currency.
Southern Europe is being destroyed by austerity measures
Countries in depression, weak exports, uncompetitive production cost can not be helped by austerity. They will only get into deeper depression which could lead to civil war. Especially to government disobedience of central European government orders and legal agreements. After all, they disobeyed European regulations before, for much more trivial reasons.
Kein Staat kann zwei Dinge aus der Hand geben: seine Verantwortung für stabiles Geld und ausreichende Beschäftigung. Der Euro hat den Beweis erbracht, dass es beides in „einem Geld der 17“ nicht gibt und dass bei „sozialisierter“ Geldpolitik kein Staat seine gesellschaftlichen Probleme lösen kann.