The Euro Crisis and the Decline of Europe

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Reuters news service reported on February 14, 2012 that the “rating agency Moody’s warned it may cut the Triple A rating of France, Britain, and Austria, and it downgraded six other European nations including Italy, Spain, and Portugal citing growing risks from European debt crisis.”

What appeared in 2008 as imminent European political integration is now in a state of disarray.  What seemed inconceivable just four-years ago – the idea that the European Union (EU) would devolve back into nation-states in part or as a whole — is now being seriously considered.  Greece, a member state of the EU and a member of the euro-zone, is now a candidate for ejection.

Decades of cradle-to-grave socialism, a short work week and long vacation periods for European Union workers have taken a toll on the treasuries of the nation states.  The good life lived in Europe without a thought of tomorrow has brought on these days of reckoning. Greece is an example of the limits of a European welfare state.

Yet, the European project of unifying non-communist Europe into a joint customs, common market, and ultimately a single currency succeeded beyond all expectations.  The nations that made up the EU gave up a portion of their sovereignty to join a competitive and effective market, and in the process 17 euro-zone European nations (Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, Netherlands, Portugal, Slovakia, Slovenia, Spain) gave up their national currencies and adopted the euro.

German reunification in October 1990 prompted the French government to initiate a common European currency: the euro.  The French feared a large unified Germany would overwhelm its smaller economy and that of other European neighboring countries with smaller economies.  Therefore the French conditioned their acceptance of a unified Germany on Germany’s willingness to give up the Mark – its strong national currency and replace it with the euro.

Today, Germany is no longer in an accommodating mood, as The Telegraph reported on February 15, 2012: “German President Christian Wulff has accused the European Central Bank (ECB) of violating its treaty mandate with the mass purchase of southern European bonds.”  Wulff added, “I regard the huge buy-up of bonds of individual states by the ECB as legally and politically questionable. Article 123 of the Treaty on the EU’s workings prohibits the ECB from directly purchasing debt instruments, in order to safeguard the central bank’s independence.” Wulff was commenting on the ECB’s intervention in the Italian and Spanish bond markets this month, which he believes poses a threat to the monetary union and Europe’s financial system. Wulff’s comments are the clearest warning to date that Germany has reached the limits of self-sacrifice for Europe.

The French are in no position to get the EU out of its mess. On August 24, 2011, French Prime Minister Francois Fillon revised the government’s growth forecast for 2011 downwards to 1.75% from 2%, according to the news group Agence France Presse (AFP), saying the measures would trim next year’s public deficit to 4.5% of GDP.  PM Fillon added, “Our country cannot live beyond its means forever.” Earlier in August 2011, world markets were rocked by rumors that France might see its credit rating downgraded and that its banks were overexposed to the debts of weaker euro-zone countries.  Fillon contradicted President Nicolas Sarkozy’s assurances which hold that the French financial system is not at risk, by warning that “France had passed the debt tolerance threshold.”

The people of the European Union are undergoing a malaise which is a by-product of economic decline and political uncertainty.  Europeans after WWII ceased believing in God, and sought to live the “good life here and now” without regard for the future.  Muslim Immigrants from North Africa, Turkey and the Middle East flooded into Europe as post-war industrialization demanded cheap labor.  It changed the face of Europe, and its culture.  Americans paid for European defense, which enabled the Europeans to enjoy a most pleasant lifestyle of short work weeks, long and paid vacations on the French and Spanish Riviera.  European demography declined below replacement long before workers were no longer needed in the post-industrial age.

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  • penny lane

    The US has a far higher deficit than Europe, equal to that of Greece, Italy and Spain, dispite not having a social system like Europes. The only difference is that while the FED may print Dollars whenever it politically wants, the European Central Bank may not, because printing money leads to inflation, which in the end the population pays for.

  • Anthony

    WIll the Moslem settlers continue their journey to Europe now that Europe is broke? It doesn’t really matter anyway, demographically speaking, the party was fun while it lasted, but now the future these lazy hedonists created for Europe will look like Kosovo, another creation of their own doing.

  • jacko

    One of the reasons for Europes decline is the knosedive of the birth rate. Most families ,if there is still such a thing ,have one or at the most 2 children which is below the replacement rate for the population. Therefore migrants are imported to keep the workforce up to scratch. The influx of non Christian or Muslim immigrants who refuse to become Europeans is the beginning of the downfall of Europe as a democratic entity.

  • Indioviejo

    Let the European Union go to hell. We have given too much of our precious blood and treasure so save the ingrates. I hope we may be able to witness their total debassement and Dhimitude from afar.

  • truebearing

    And still Obama marches on, going down the same path that most of the rest of the world has recoiled from. We have a president that, despite being deified by the media for his brilliance, is eagarly following a doomed path, its entire length flanked with dire warnings, straight off an economic cliff. A person of sub-par intelligence couldn't miss the obvious consequences of following in Europe's footsteps, yet Obama has ethusiastically maintained this tragic course.

    Something is false. Either Obama is actually quite dumb, with an IQ in the 80 point, or less, range, or he is intentionally taking America into a black hole. The evidence suggests our trajectory is intentional as hell, and that Obama is a malevolent Meccan Horse. While virtually nothing he has done has benefitted us, or our allies, everything he has done has invigorated the spread of Islam here, and the rise in power of the Islamists in the Middle East.

    • john gerard

      Obama isn’t dumb. He knows exactly what he’s doing. He hates America, and his whole mission is to make America less powerful, less important, less influential, and poorer. That’s what he’s set out to do, and he will be re-elected in November to continue taking the country apart. This is a man who is the son of a Muslim father/step father, the son of a Marxist who married two Muslims, who spent her entire career dedicated to the idea that Muslims are the victims – somehow – of US colonialism. And he spent his formative years in a Muslim, third world sh*t-hole. Answers the question, really…

      • SAM ARISAN


  • john gerard

    Germany never gave up the DM. They just changed the name to Euro. That’s all the Euro is. It’s a fiscal version of the cup-and-ball trick.

  • Vladimir

    "Decades of cradle-to-grave socialism"? Greece was never a socialist. And the other candidates for the next European defaulted too. Who are they writing with the claim for review?

  • Vladimir

    Where is my coment?

  • Olivier Haertig

    Buiding Europe is a dynamic process, with chess and trials, but it goes on. At least, Europe enjoyed 67 years of peace in a row and is still at the head of an incredible cultural, natural , historical and human capital. There are more cultural treasuries in Rome than in the whole US.

    Yes Europe faces a crisis, which is not the first one. But always it grew up through crises, since no sufficient political consensus arises in calm days.
    And do you think serioulsly that the US, China, Midle-east, Africa or India are in such a quiet and reliable situation as compared to Europe? Just check the outrage and the violence of the comments posted about Obama!