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Boston Globe: Economic Crisis is an "Existential Threat" for the EU

The Boston Globe gets dramatic:

In America, the recession has been primarily an economic phenomenon, with conventional political effects. But in Europe, the economic tsunami is threatening to dissolve the continent's greatest political achievement: the peaceful democratic edifice of the European Union.

The fault lines have become evident in recent weeks. One division pits some nations of Central and Eastern Europe against older EU members of Western Europe. Another divides states leaning toward protectionist measures, such as France, against stout upholders of free trade, such as Britain and Germany.

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Pat Patterson on :

It's somehwhat understandable for the hysterics of the Boston Globe when they recently reported that they were "only" losing $1 million a week. So they are happy to report that they are not losing money as fast as their parent company, the New York Times, and that the Europeans are much worse off.

David on :

The NY Times lost just a tiny fraction of what (Murdoch-owned) News Corp. lost last quarter ($6.2 billion), but I don't see how that's relevant to the op/ed discussion. Can you point to a print daily (liberal or conservative) that's making profits these days?

Don S on :

I suspect the FT (Financial Times) is making money, David. Wouldn't be surprised if McPaper (USA Today) is in the black as well....

Pat Patterson on :

David-Do you mean that you're the only one allowed to post iffy statistics?

Solipson on :

Every crisis has a lasting effect on the institiutions involved. IMHO this crisis will be the Great Leap Forward for European integration. The Euro zone will only fail if Germany decides so and it won't. Therefore the Euro will prevail. The UK will join it, so will everybody else of the rest. Then on towards the third phase of integration, North Africa, the Near East and Russia. I would have thought that my grandchildren would witness this. Not it looks a if our generation would put the finishing touches on the Euro 40. Hasta la vista Richard Fould, we will erect a statue for you in Brussels:-)

Marie Claude on :

I have another reading, if the other EU states accept the german leadership, can't see that happening from UK, France or Spain But the facts show more that Germany is looking for a russian alliance and that she is gradually steping out from the EU a worsened money crisis will make a tabula rasa, and a "chacun pour soi" will prevail

Zyme on :

Not so fast Marie - the German-Russian cooperation is primarily a tool for Berlin to further its influence in Europe: The more the possible fundament of an alliance between Berlin and Moscow is presented to the other EU members, the more the latter are expected to do something to preserve the current EU-order. So effectively Germany wants to create an alternative which is supposed to "encourage" especially France and Britain to make advances to Germany.

Solipson on :

Marie Claude, I am not talking about explicit German leadership here. In this you would be right, France and the UK would never accept that. I am talking about sheer numbers and the resulting power. If Germany would decide that the good old DM would be a better currency and revert back to it, the Euro would be dead. If the benchmark decides to change course, the rest has to follow. France would never, ever, ever leave the Euro, solely for the fear of losing influence. And even if they did, the rest would stay. The others don't matter in this respect. Who would care if Italy or Greece would leave the Euro. Their debt is denominated in Euro, the new currency would be a laughing stock and they would be bust in no time, because nobody would extend any credit to them. The UK? Who will bail them out next year? Their special relationship? No way. The IMF, World Bank? Nope. The EU will have to do it. And the price will be the Euro. Regarding the Russian alliance, look at history. Germany nearly always had a cordial relationship with Russia. At least in business terms. Who supplied the Wehrmacht with crucial commodities right up until the start of Barbarossa? Yep, the Russians. Who supplied the Russians with the pipes for their pipeline network at the height of the cold war? Yep, the Germans. Just a couple of examples for this relationship throughout history. No need for an alliance.

Marie Claude on :

Solipson, "I am talking about sheer numbers and the resulting power. If Germany would decide that the good old DM would be a better currency and revert back to it, the Euro would be dead. If the benchmark decides to change course, the rest has to follow." Well what I can deduct from your response is that all the EU states regret to have endorsed the euro, precisely this was SarKo and Berlu talks lately, and Sarko made no mystery that the Central bank had some rules that weren't convenient and that need to be changed, and, as usual, she found an opposition from Germany "France would never, ever, ever leave the Euro, solely for the fear of losing influence. And even if they did, the rest would stay". yeah, right you said it, "influence", precisely this is the influence quarrel between Germany, our state, and UK, but forecasting that we wouldn't leave the euro for that, umm, it's not knowing us, we can transform it into a mediterranean money where our "influence" would be welcome. The others don't matter in this respect. Who would care if Italy or Greece would leave the Euro. Their debt is denominated in Euro, the new currency would be a laughing stock and they would be bust in no time, because nobody would extend any credit to them. I wouldn't like to be in British shoes today, seems that the sky is falling onto their heads, though, I expect that we'll support them, they were/are, at least, in spite of their wweird spirit, our last best alliees in the past. "Regarding the Russian alliance, look at history. Germany nearly always had a cordial relationship with Russia. At least in business terms. Who supplied the Wehrmacht with crucial commodities right up until the start of Barbarossa? Yep, the Russians." yeah, I know, that's costed us our defeat, had the Russians not been your alliees, our communists would have much better prepeared the war "Who supplied the Russians with the pipes for their pipeline network at the height of the cold war? Yep, the Germans. Just a couple of examples for this relationship throughout history. No need for an alliance." umm, see ya, you have logical alliances from history, and that's not France and UK, Spain was with Charles Quint, and Franco, I doubt that she follow you today, even with their king that has nothing to share with the ancient preussian/austrian nobleness, but Bourbon :lol: So time will tell us if we configurate the ol geopolicy, it seems that there some inclinations

Solipson on :

I don't think any Euro country regrets having endorsed the common currency. Especially not in this day and age. There's a lot of bickering and quarreling about it, but that's what you get in a federal entity. Take the French general instinct of wanting to control the central bank and the German reaction to it. It's theater for their political bases. By the way, if Sarko and the Italian stallion would have not seized the opportunity for a cheap joke, I would have been seriously disappointed:-) Who would include the Mediterranian Union? France, Italy, 16 Arab countries and Greece? Have fun with that one:-) Re the French defeat in 1940. It wasn't the Russians who played the crucial part. You had the greater numbers, superior technology and the advantage of the defender. It was your elites who screwed up. Nobody listened to de Gaulle, that's why we were able to temporarily extend our borders to the Atlantic :-)

Anonymous on :

Solipson - "By the way, if Sarko and the Italian stallion would have not seized the opportunity for a cheap joke, I would have been seriously disappointed:-)" uh, you like Sarko, don't you ! "Who would include the Mediterranian Union? France, Italy, 16 Arab countries and Greece? Have fun with that one:-)" they are serious partners with money, oil and gas, so does german cousin Putin LMAO (but not the money) "Re the French defeat in 1940. It wasn't the Russians who played the crucial part. check, France socialist/communists, before and after WW2, took their orders from Moscow, an american passionated of history revealed it to me, and I made some researches, unbelievable ! http://www.lepoint.fr/actualites-politique/qui-a-peur-des-archives-de-moscou/917/0/94473 they made all their possible to delay the manufacturings of planes... arms, to deliver pieces... with the unions, their motos were : Hitler Vichy, not our problem, De Gaulle resistance, not our problem, they were waiting for Stalin orders to start to fight the nazis, until that the Soviets will join them in France and set a communist government. "You had the greater numbers, superior technology and the advantage of the defender. It was your elites who screwed up. Nobody listened to de Gaulle, that's why we were able to temporarily extend our borders to the Atlantic :-)" yeah the elites were screwed, the atmosphere was merely to unions fights and victories, and lefty intellectuals were celebrating too well , it is said that we had better "tanks", though not enough numerous (as the panzer division's), the line Maginot was the big deal, cuz the old Etat Major that had made already 2 wars with germany thought that the way to France would be still the same ol one, planes were evidently not enough numerous, this played the major role in Belgian and Dunkeerke So, have you got an idea of which way you're gonna use next time, so that I harass my government to make sure it would miss the right decision :lol:

Marie Claude on :

good ol Thorez http://www.lepoint.fr/actualites-politique/quand-staline-recevait-thorez/917/0/104581

Pat Patterson on :

Minor correction France had more and better tanks then the Germans at the beginning of the war and French armour acquited itself very well against the Germans. Especially in Belgium and covering the retreat to Dunkirk. But when Rommel reached the hills overlooking the embarkation points he had more captured Renault 35 and Somua tanks and French artillery then the Germans had at the beginning of the invasion. The French also had a numerical superiority of planes but the key problem was that the Maginot Line worked exactly as expected but the Allies were simply unable to stop the Germans in flanking the Line.

Marie Claude on :

http://www.youtube.com/results?search_type=&search_query=Week-end+%C3%A0+Zuydcoote&aq=f it shows that the British were leaving the place, also that planes fighting were harch, from wathever air forces "Au contraire des machines produites à la chaîne de la Luftwaffe, les avions français étaient virtuellement assemblés à la main et en petit nombre, même s'ils restaient formidables en mains de pilotes expérimentés. L'aviation ... En 1939, l'armée française possédait parmi les meilleurs chars au monde. Dotés d'une mécaniques solide et puissamment armés, ils avaient un blindage plus épais que celui de n'importe quel char allemand et des équipages bien entraînés. S'il y avait un seul défaut dans la doctrine blindée française, il était lié aux principes d'engagement des chars. Dépourvus d'entraînement dans les manœuvres de chars à grande échelle, les Français tendaient à employer leurs blindés dans des attaques par petits paquets, sans coordination avec l'infanterie, l'artillerie et l'aviation." http://www.checkpoint-online.ch/CheckPoint/Histoire/His0004-OperationSarre.html yes, the elites were beyond their possibilities

Kevin Sampson on :

Gen. Heinz Guderian was the first to see the potential of a mechanized army, and he developed the doctrine and tactics (blitzkrieg) that made that potential a reality. This mobility is what allowed the Germans to flank the Maginot Line so easily. Guderian's tactics executed by field commanders like Erwin Rommel completely outclassed the French and British military leadership.

Marie Claude on :

yeah, I made that reference on PJM, though what you forget to say, Guderian got his science from de Gaulle and from two honorable British who wrote books about how should become a modern army

Joe Noory on :

That sounds familiar. Today Austria, tomorrow the world?

Solipson on :

Oh, Joe, I love it when you talk dirty :-)

Don S on :

Ah well, it doesn't do to take such things too seriously. There is a school of thought (based in Moscow apparently) that President Obama will be declaring martial law before the end of 2009, and that the US will dissolve into 6 pieces by 2011. So there! I take one systemic crisis and raise you a dissolution!

Zyme on :

I ve read an article about that. Of course I am not holding my breath for such a development - but imagine for a moment it would happen in a similar way: Wouldn't the world be a better place and become a lot more interesting again? Lots of empires dividing what is left and gaining a new target for the struggle for influence :) Sounds almost too good to become true. Personally I rather expect a bleak development here in Germany on mid-term should the crisis be a longer one and will post about it tomorrow here.

Don S on :

A better place? No.

David on :

This is hilarious: "Panarin said the recent economic turmoil in the U.S. and other "social and cultural phenomena" led him to move up his timetable for "The End" — when the United States will break up and Alaska will revert to Russian control. He linked America's social and cultural issues to the large prison populations and large numbers of gay men." I wonder how what the 6 states would look like? Would we have our first all gay republic?

Don S on :

The People's Republic of Sausalito......

Joe Noory on :

It's the same old, unimaginative projection and rationalization: the CCCP fell apart, and therefore to try to 'normalize' that, the US mst also fall apart. So too with the fate of men in Russia - they die young, and for years the average age of death through alcoholism, generalized risky behavior/ decadence due to not seeing a future, and prison TB. There too, someone else must also suffer from it to salve the guilt of letting that part of their own society down. Look more closely at these broad declarations, especially from Europeans angry and scraping for things like the 18th century slave trade, and all you can find is people looking to feel righteous and better about themselves by finding something imutible to hate in some percieved figure of authority. Badly socialized adolescent often do the same thing. Then some of them call themselves activists and young radicals to ligitimate their past assertions and behavior.

quo vadis on :

The most remarkable transformation of all, to me anyway, is that by 2011, I will want to be Chinese. Frankly, I'm not looking forward to it. Here's Dr. Panarin's map: http://www.boingboing.net/200901021503.jpg

Zyme on :

In a week after when an American insurance company announces the biggest loss ever of a single company within one quarter it is hard not to think about 'What if' this is going on. In this case, 'What If' the crisis will not go away within 12 months. I am not thinking about pure economical details - my focus is on the consequences for societies and nations, specifically here in Germany. At the bottom I have a handful of questions to You about which development was likely in Your country in the event that the American President was unable to save the world. To get an idea of which way our nations might take during the Crisis, let us for a moment assume that the economy will take a serious hit and not recover soon. Only by this pessimistic assumtion we can clearly draw the differences of the developments in our respective nations. So let us assume that unemployment will rise, tax revenues will drop, important banks cannot be saved and consumer confidence freezes for a period of at least 5 years while the political leadership seems helpless. What would happen? If you take into account that even during the economical upswing of the last years, voter turnout at general elections and support for the established parties in Germany has tumbled, it is not difficult to guess that this trend would harden. Even two years ago when everything was still fine economically, I recall a professor for public law of my former university during a break in a seminar telling us the (at that time) latest shameful blunders of all political parties having seats in the national parliament when they - while being in charge - had tried to create laws at federal or state level serving their intentions and had failed horribly. His literal résumé was that "one should not take part in national elections, as casting a vote for any of these parties only supports this horrible system". As it happens this man was not only a professor at the legal faculty of my former university - that was only his part-time job. His main job was to be a judge at the constitutional court - the last line of defense for our wonderful constitution so to speak. Back at that time I found it hard to stomach listening to a seeming custodian of our system who told us in a semi-private atmosphere of the reasons for his personal rejection of our parliamentary democracy. If you furthermore take into account that - during the rather positive development of the last decade - political discontent of the people has risen due to the fact that only the richest 10% of our population have gained a considerable increase in buying power (in such a high way that it even balanced the partially drastic losses of other parts of our society), what do you think will happen during a prolonged downturn? Should you have ever worked for a German company, then it is not - say - unlikely that you will agree to my perception that German business culture is and has always been rather authoritarian. The fathers of our constitution have put their utmost effort into keeping this trait out of our political system. Instead it was designed to become an anti-authoritarian state. Yet despite all these efforts, the traditional authoritarian trait has creeped back into the German political landscape via our political parties. Within these, critical backbenchers have been sidelined systematically in favor of the highly acclaimed role model of a "party soldier". This has reached a state where it is difficult to say whether it would make a difference in law-making should the party leaders get the voting rights of their members of parliament and exercise it directly by themselves. Now when during a serious downturn not only fringe groups lose their livelyhood but also a considerable part of the middle class does and the social state has to drastically cut its services due to lack of funds, what do you think most of the ever growing number of people staying away from general elections will do? I believe when that point is reached, they will awaken from their political limbo and spring to life. When even the state's own employees are becoming unfaithful, the order is weakened from within while from the outside its armour is still looking shiny. Once there is enough discontent among the people, stability is threatened. Chaos follows and the streets may turn into a battlefield. Today I think it is not possible to predict which group would prevail in such a public conflict. It could be the "socialists", who despite the fact that the biggest downfall of their ideology did happen not too long ago have a growing number of supporters in all of Germany. It could be a fascistical movement, who more and more succeed at looking semi-moderate and try to appeal to the middle class. But whatever colour the prevailing ideology would have, there is one thing to be sure of: This order would behave the same way every new order does - it would do its best to be the opposite of the last one and thus officially bring back the authoritarian state. As You have finished reading this bleak outlook, I have a handful of Questions: Since there are readers from Europe, from America and beyond here - what do You think will be the course of Your country, should the crisis be a prolonged one? Would the reactions be different from the crisis in the 1930s - if so, why? How long would it take a serious economical downturn to shaken the current order in Your country? Or would the people instead of the state make themselves responsible for failure and have faith in their current system?

David on :

Zyme, With respect to voter participation, in the US we just had an election where 63% of eligible voters went to the polls. That may seem low by EU standards, but it was the highest voter turnout in the US since the 1960 presidential election. Hard to say what will happen if the recession/depression drags on for two more years, but I don't see Americans embracing authoritarian solutions. There was a much greater danger of that immediately following 9/11 in America. Concerning Germany, how do you explain the resurgent Liberals (FDP)?

Zyme on :

Frankly, I discussed the FDP's gain a few days ago with my colleagues coming to only a single conclusion: It shows the degree of disappointment the voters towards the governing parties - especially the conservative ones. Those turning to the FDP oppose the nationalization of banks and other troubled companies and instead believe in the market to regulate itself. Then of course the FPD benefits from the government's efforts towards a complete surveillance of the financial sector - ranging from foreign banks to German bank customers. Any other explanation is difficult, as the FDP's gain cannot result from a convincing strategy: The party is virtually non-existant in the press. Merkel's patient governance might put even more strain on the conservative party. But this is too early to judge, as in the past she (too) often got away with her style of evading controversial topics.

Joe Noory on :

Wow - you sure know how to not talk about economics when you say you will. Does a European saying that they wonder if Brussels will survive an economic slump to be taken seriously while the Boston Globe is just parroting some kind of fanciful crazy-talk? [url=http://euobserver.com/9/27778]'Jury's out' on future of Europe, EU doyen says[/url] As for the notion that you have more discontent in a society when successful people exist in it, you need to realize that it isn't an Economic argument, in fact it isn't even a social observation. Attention seeking writes have dragged that one out off and on for the past 25 years, through all sorts of economic phases - even Saint Naomi Klein, author of the allegation that only conservatives employ disasters to advance their social and economic concepts, when the entire idea was at the heart of the Frankfurt School, Das Capital, and was the first thing on Rahm Emmanuel's tongue - in other words, it's a somebody's wishful thought. It isn't a firm theory, an concept, and observation, or an economic or social proxism, it's something simpletons can grasp onto to make them feel smart. Basically, there's no cure for gravity.

Solipson on :

Joe: Very good article! And a good comment. Fully agree. I even think this argument is much older. It has been used (in reverse) for centuries to keep the order. Zyme: This. is. not. the. Weimar. Republic. Full stop. Not the singlest group in sight in Germany (and all of Europe) that has any form of influence AND hates the system. Which is the precondition for your desaster scenario happening. Not even the disenfranchised, the cannon fodder, is to be seen.

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