Take out the call for better enforcement of tax collection in the EU and the props for bankster tool Merkel and I could pretty much agree with all of Ed Yardeni's
view on the eurozone:
The spending of European governments has ranged between 40% and 60% of GDP for many years. The revenues collected by these governments have ranged between 30% and 50% of GDP. The resulting deficits have led to rapidly rising ratios of government debt to GDP.
Attempts to bring back some fiscal sanity, led by Germany’s Chancellor Angela Merkel, are now widely caricatured as fiscal “austerity.” In my opinion, the only way to fix Europe is to slash government spending, reduce tax rates, enforce tax collection, and deregulate labor markets. Instead, enraged European voters are rising up against austerity and voting for the status quo. They haven’t indicated who they expect will pay the bills. However, they must be counting on either the Germans to pick up the tab or the ECB to implement more rounds of the LTRO.
European politicians who signed on to the “fiscal pact” promoted by Germany late last year are losing their jobs. Those favoring a “growth pact” are winning support, though they have no specific plan yet and certainly no way to finance it once it is specified. Also gaining support are various left- and right-wing fringe groups that tend to promote anarchy as the most effective way of overthrowing the established order and replacing it with their disorder.
Europe is at risk of devolving from an economic and monetary union into a disunion of failed states.
I would further add, a disunion of failed states moving toward greater confusion via greater central planning.
Its a bit of a pickle when the debt is the peoples and not the kings. Suppose that's the rationale behind blind trust in every Regent and John Law like Krugman who has an edict and the paper to back it up. So long as people pursue ignorance I say you're exactly right. The only collapse I see is further consolidation. If given an easy way out man will try to take it...
ReplyDeletethere is a misconception here. there is no "austerity" anywhere in europe. all there is are declarations of austerity, but no real spending cuts. on the other side, most EU countries are seeing harsh tax increases, either in the form of plain increases, or in the form of oppressive tax collection. so there are two types of european rebellion to "austerity": those who fear cuts in their entitlements, and those who see their taxes raise at an alarmingly fast rate.
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