Sunday, April 29, 2012

The ongoing European disaster movie known as Angienomimcs

Angela Merkel, currently the world's leading prophetess of austerity economics in service to the Great God Free Market, is feeling more and more pressure as the peasants and vassal states start to revolt. She grew up in East Germany. She should have known that a Brezhnev approach wasn't going to endear the satellite countries other members of the European Union to her.

As economies continue to collapse and governments to fall under the weight of Angienomics, all she seems to know how to do is plow ahead. It's getting so bad that even the German Social Democrats (SPD) are making sounds like they aren't completely neutered and lobotomized in the face of her ruinous policies. It's too early to say they've come back to life, but even discordant zombie grunts and groans are an improvement over where they've been the last few years. (Okay, so it's a garbled metaphor! At least it makes more sense than Angienomics, though admittedly that's a low bar.)

What that means is the SPD is acting like Obamabots at the moment. Angie fiscal pact that locks all the countries that agree to it, including Germany, into austerity economics in perpetuity, is one of the most irresponsible ideas the Europeans have come up with since the Second World War. Angie needs votes from the SPD and the Greens. They should vote on a party line against her, because the thing is bad for Germany and is basically a coup de grace to the European Union. At this point, Angienomics has wrecked it to the point that it's hard to imagine how it survives. But the SPD and Greens should remember this fluff rhetoric over the last couples of decades about how the Germans are "good Europeans" now and vote the thing down. That would be the "good European" thing to do. Let Angie take the full blame for destroying the EU.

Instead, the SPD are acting like American Democrats and saying, now we won't vote for this unless you agree to raise taxes on the wealthy a tiny bit! Actually, it's not quite that bad. What they want is a financial-transaction tax, aka a "Tobin tax" after the late Nobel economist James Tobin who advocated it. The Tobin tax is a very good idea. But Angie's fiscal pact is a disastrously awful idea with or without a Tobin tax.

The Presidential election in France next weekend is causing big worries in AngieVille: Steven Erlanger and Nicholas Kulish, French Front-Runner Says He’d Seek to Renegotiate Fiscal Treaty if Elected New York Times 04/25/2012. Angie doesn't take kindly to the notion that the head of a mere vassal state might soon be trying to tell her what to do. Or rather, what his country is not going to do. Princess Angie von Merkel und Brüning isn't used to such attitudes from spokesman of the lesser peoples, and they do not amuse her.

But wait! Angie has a new stimulus, uh, growth, uh, new PR plan coming in June!! Which might be good news if it sounded like it was anything other than Angienomics with a happy face. Or maybe with a happy-face-or-else. (Merkel le pone paños fríos a sus consejos de ajuste Página 12 28.04.2012; Merkel anuncia una "agenda del crecimiento" para la UE Público/EFE 28.04.2012)

Angie gave an interview to the Leipziger Volkszeitung:Kanzlerin Angela Merkel im LVZ-Interview: "Keine Neuverhandlungen beim Fiskalpakt" (Interview: Frank Lindscheid, Arnold Petersen, Dieter Wonka) 28.04.2012. My summaries of her major points on European affairs:

Ze French vill do vhat zhey are told! No matter who ze President vill be!

Ze lesser nations EU vill make zehr budgets ze vay I tell zhem zu make zhem!

Our EU vassals partners vill cut zher wages and weaken zher unions and make make zehr budgets ze vay I tell zhem! But starting in June I vill command zhem to call it a growth agenda! And zhey vill pretend to like it!!

Vhat do I think of ze new German President zhat I didn't vant? Do not ask me zhese impertinent questions!

No, I don't care how little our German vorkers get paid! Ze German banks are ze important thing!!!

An Osnabrücker Zeitung report (Merkel: Nicht nur sparen, auch investieren 28.04.2102) mentions a phrase (in English) that I haven't heard before, the Friends of Better Spending. Yahoo! Deutschland also doesn't seem to have heard of it. But at least in the Osnabrücker Zeitung, that's the name for a group of countries that propose what sounds like a good-government idea to improve the efficiency of EU-funded infrastructure spending. Which sounds like a good idea that basically won't do jack to meet the immediate economic and financial crisis. The countries of the Friends of Better Spending are said to be Austria, Germany, Finland, France, Italy, the Netherlands and Sweden.

I hear the music on the Titanic was nice, too.

The EU Commission is talking about setting up a $200 billion infrastructure fund. (Claudi Pérez, Europa programa su resurrección El País 29.04.2012; EU-Kommission plant "Marshall-Plan" für Europa Welt Online 29. Apr. 2012; ) They can label it a new Marshall Plan or whatever other label polls well. But as long as the EU is strangling itself with Angie's austerity economics, it won't make much difference.

It actually should be a sign of alarm that EU official are talking about a "Marshall Plan". The original Marshall Plan was a massive program of US financial aid to western European to help them rebuild after the Second World War. That the failures of the EU and the common currency have brought them to a point that they need to talk about a "Marshall Plan" is a real indication of how badly they've messed things up.

And as long as the EU countries are operating on the neoliberal dogma that prioritizes austerity, budget cuts during this depression, and the rollback of civilian government across the board, they will stay in the current self-destructive cycle, even despite a jake-leg "Marshall Plan".

It's not that the various stopgap measures that the EU has been taking the last few months and the ones we're hearing noises about now are meaningless or immaterial. It's that they are stopgap measures. And the solutions that the EU needs in short order have been made virtually impossible by the world that Angie has made. The EU and the eurozone in particular needs to become a transfer union, with substantial automatic transfers from wealthier countries to poorer ones, especially in recessions. The European Central Bank (ECB) has to become a buyer of last resort for eurozone sovereign debt. Eurozone countries need access to eurobonds, based on the credit and legal banking of the eurozone as a whole. And this insane "fiscal pact" that seeks to ban Keynesian stimulative policies forevermore needs to be flushed down the toilet.

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