Europe Prepares for Leadership Change
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  • Kenny

    1. France is the weak country with a weak hand to play. The future is slipping away from the French much faster than they realize.

    2. Why do you continually use an euphemism like ‘growth measures’ when what is actually afoot with Hollande’s plan is 1) massive deficit government spending and 2) inflation?

    Call a spade a spade, Mr. Mead. In that way, your communication will be a lot clearer, not to mention a heck of a lot more honest.

  • Jacksonian Libertarian

    “If all Hollande wants is to make it look like he has added a growth (read: spending) dimension to EU policy, then agreement with Merkel will be easy — and may actually strengthen the European consensus.”

    Spending doesn’t lead to Growth that leftist politicians are allowed to get away with this lie, is a shame on journalists everywhere. In fact Government borrowing reduces the capital available to consumers and businesses by reducing supply which drives up the price of capital to reduce demand (the Law of Supply and Demand). This actually shrinks the economy by shrinking consumer and business economic activity. Leftist economists and politicians will tell you that the government needs to borrow and spend in order to make up for reduced demand by consumers and businesses during a recession. But, this is putting the cart before the horse, as demand is subject to the amount of supply, and government borrowing reduces that supply.

    When Hollande takes control and spends and borrows more, what happens to the French economy will be the exact opposite of growth. I expect European capital to accelerate its departure from the EU. This will be good for the US as much of the capital will come here, and help offset the $1.3+ Trillion a year in borrowing our own government is doing. Investors everywhere recognize that only in the US is there a growing political resolve (the TEA Party) to deal with government debt, borrowing, and spending.

    To those who ask what about Germany? I say Germany is intimately connected to the European economy, and it is going to suffer major dislocations to its exports and deficits from an intransigent France and the PIIGS. And while Germany has reduced its deficit it is about to incur new expenses with new bailouts, and reduced economic activity which will drive it back up and accelerate borrowing.

  • Cunctator

    If Merkel were serious about solving Europe’s problems, she would have given Hollande more time to prepare before meeting with him.

    If Hollande was serious about the meeting, he would demanded a delay.

    The meeting will just be a photo op, nothing more. And the Euro-crisis will continue to grind away.

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