Even Germany isn't immune to political upheavals.
This last weekend's parliamentary elections in Germany's largest state, North Rhine-Westphalia, led to a substantial victory for the Social Democrats and defeat of Chancellor Angela Merkel's party, the Christian Democrats. Although many observers emphasize that this election was only local, The Christian Democratic party leader in North-Rhine/Westphalia had claimed during the campaign, that the election is a "referendum" on Angela Merkel's policies.
If so, Merkel lost the referendum.
The Christian Democrats also lost the previous weekend's election in Schleswig-Holstein.
The next scheduled German election is September 2013, but there is speculation Merkel may have to call early elections.
Showing posts with label Europe. Show all posts
Showing posts with label Europe. Show all posts
Monday, May 14, 2012
More On The Eurozone
In case you haven't been following events in Europe, things aren't looking so good. The UK is in a double dip recession. The government of Holland has fallen over proposed new austerity measures. The Greek government has been voted out of office. Spain has 23% unemployment, with unemployment among young workers at 50%. The cost of borrowing by the government of Italy has risen. President Sarkozy of France was defeated by a socialist who does not support further austerity.
At the end of this month, Ireland will have a referendum on whether to accept a new EU treaty imposing greater control of fiscal policy from Brussels. By the way, Ireland has declining GDP and high unemployment.
So where does Europe go from here? Some knowledgeable observers expect Greece to fall out of the Eurozone as early as next month. Here's Paul Krugman's take:
"Some of us have been talking it over, and here’s what we think the end game looks like:
1. Greek euro exit, very possibly next month.
2. Huge withdrawals from Spanish and Italian banks, as depositors try to move their money to Germany.
3a. Maybe, just possibly, de facto controls, with banks forbidden to transfer deposits out of country and limits on cash withdrawals.
3b. Alternatively, or maybe in tandem, huge draws on ECB credit to keep the banks from collapsing.
4a. Germany has a choice. Accept huge indirect public claims on Italy and Spain, plus a drastic revision of strategy — basically, to give Spain in particular any hope you need both guarantees on its debt to hold borrowing costs down and a higher eurozone inflation target to make relative price adjustment possible; or:
4b. End of the euro.
And we’re talking about months, not years, for this to play out."
In any event, it looks like the future of the Eurozone is mostly up to Germany, but may be up to European voters.
At the end of this month, Ireland will have a referendum on whether to accept a new EU treaty imposing greater control of fiscal policy from Brussels. By the way, Ireland has declining GDP and high unemployment.
So where does Europe go from here? Some knowledgeable observers expect Greece to fall out of the Eurozone as early as next month. Here's Paul Krugman's take:
"Some of us have been talking it over, and here’s what we think the end game looks like:
1. Greek euro exit, very possibly next month.
2. Huge withdrawals from Spanish and Italian banks, as depositors try to move their money to Germany.
3a. Maybe, just possibly, de facto controls, with banks forbidden to transfer deposits out of country and limits on cash withdrawals.
3b. Alternatively, or maybe in tandem, huge draws on ECB credit to keep the banks from collapsing.
4a. Germany has a choice. Accept huge indirect public claims on Italy and Spain, plus a drastic revision of strategy — basically, to give Spain in particular any hope you need both guarantees on its debt to hold borrowing costs down and a higher eurozone inflation target to make relative price adjustment possible; or:
4b. End of the euro.
And we’re talking about months, not years, for this to play out."
In any event, it looks like the future of the Eurozone is mostly up to Germany, but may be up to European voters.
Wednesday, April 25, 2012
Britain In Recession
Official data released today shows that Britain has slipped into a new recession.
Britain's new recession is not a direct consequence of policies of the European Central Bank, because Britain is not in the Eurozone. It retains its own currency, the pound.
But the Cameron government has been following a policy of economic austerity, insisting that this will lead to economic expansion.
Apparently, not so much.
Actually, Britain's recovery from this recession is worse than its performance in the 1930's following the Great Depression.
Britain's new recession is not a direct consequence of policies of the European Central Bank, because Britain is not in the Eurozone. It retains its own currency, the pound.
But the Cameron government has been following a policy of economic austerity, insisting that this will lead to economic expansion.
Apparently, not so much.
Actually, Britain's recovery from this recession is worse than its performance in the 1930's following the Great Depression.
Monday, April 23, 2012
More On Europe And The US
Good article in today's Guardian concerning the economic and political turmoil in Europe and the continued intransigence of her economic leaders. The author, Robin Wells, predicts the US may suffer collateral damage.
Sunday, April 22, 2012
Europe On The Edge
This weekend's elections in France may portend a serious shakeup in European politics. Nicolas Sarkozy lost the first round of elections to the Socialist candidate, Francois Hollande. There will be a runoff election between these two leading candidates on May 6.
I had previously suggested that the first decade of the Euro could well be the last. For awhile, it appeared that the Greek government might be the most vulnerable in Europe to a repudiation by the electorate of austerity measures. Clearly this past weekend, French voters sent a strong signal. It seems increasingly likely that European voters in other countries will reject the austerity forced on them by the European Central Bank under the strong influence of Germany.
"It [the election] may also represent the first stirrings of a challenge to the German-dominated narrative of the euro crisis, which holds that public debt and runaway spending are the main culprits and that austerity must precede growth." - NY Times.
It has been obvious to what I would call the sensible economists (those of a Keynesian bent) for a long time that austerity in a time of recession will not lead to growth. It should have been equally obvious to political leaders that intentionally causing a depression in one's own country is not a recipe for reelection.
Over the weekend, the Dutch government failed to gain majority support for austerity measures, and more Czechs turned out to protest a tax increase and budget cuts than any protest since 1989.
I had previously suggested that the first decade of the Euro could well be the last. For awhile, it appeared that the Greek government might be the most vulnerable in Europe to a repudiation by the electorate of austerity measures. Clearly this past weekend, French voters sent a strong signal. It seems increasingly likely that European voters in other countries will reject the austerity forced on them by the European Central Bank under the strong influence of Germany.
"It [the election] may also represent the first stirrings of a challenge to the German-dominated narrative of the euro crisis, which holds that public debt and runaway spending are the main culprits and that austerity must precede growth." - NY Times.
It has been obvious to what I would call the sensible economists (those of a Keynesian bent) for a long time that austerity in a time of recession will not lead to growth. It should have been equally obvious to political leaders that intentionally causing a depression in one's own country is not a recipe for reelection.
Over the weekend, the Dutch government failed to gain majority support for austerity measures, and more Czechs turned out to protest a tax increase and budget cuts than any protest since 1989.
Other countries whose voters increasingly press for growth instead of austerity include Great Britain, Spain and Italy.
It may be possible to rescue the Euro, but it looks more and more difficult.
Thursday, April 19, 2012
Secret Police In The Heart Of Europe
Here's the latest report from Hungary. On the theory that if something walks like a duck and quacks like a duck, it probably is a duck, this sounds like a dictatorship under construction.
Can Europe stand up to Hungary? The world wonders.
Can Europe stand up to Hungary? The world wonders.
Thursday, January 12, 2012
Hungary Update
Hungarian Prime Minister Viktor Orban seems well on his way to turning Hungary into an authoritarian dictatorship. In an earlier post, I suggested Hungary was beginning to resemble the authoritarian regime of Admiral Horthy, who led Hungary from 1922 to 1944.
That was a good guess. Viktor Orban himself has called attention to Horthy as a model. The latest report from Hungary by Professor Scheppele is not good. The most hopeful sign is that the EU is calling Hungary to task. Whether the EU's measures will work any better than the timid measures taken by the League of Nations in the 1920's and 1930's is anybody's guess.
What seems clear is that the events in Hungary are a serious threat to democracy in Europe.
That was a good guess. Viktor Orban himself has called attention to Horthy as a model. The latest report from Hungary by Professor Scheppele is not good. The most hopeful sign is that the EU is calling Hungary to task. Whether the EU's measures will work any better than the timid measures taken by the League of Nations in the 1920's and 1930's is anybody's guess.
What seems clear is that the events in Hungary are a serious threat to democracy in Europe.
Monday, December 19, 2011
Hungary - Back To The Future?
Disturbing post today on Hungary's authoritarian revolution. It sounds like a more extreme version of what has been happening in Wisconsin, Michigan and other states in the United States.
The post appears on Paul Krugman's web site, but it is written by Kim Lane Scheppele, Director of the Law and Public Policy program at Princeton University.
It sounds like what is happening in Hungary is a reappearance of the kind of authoritarian regime that has characterized Hungary in the past, including the notorious period of Admiral Horthy's dominance from 1920 to 1946. The forms of governance may resemble those of democracy, but the content is increasingly that of authoritarianism.
By the way, Newt Gingrich's recent diatribes against judges would fit right in with the new Hungarian system.
The post appears on Paul Krugman's web site, but it is written by Kim Lane Scheppele, Director of the Law and Public Policy program at Princeton University.
It sounds like what is happening in Hungary is a reappearance of the kind of authoritarian regime that has characterized Hungary in the past, including the notorious period of Admiral Horthy's dominance from 1920 to 1946. The forms of governance may resemble those of democracy, but the content is increasingly that of authoritarianism.
By the way, Newt Gingrich's recent diatribes against judges would fit right in with the new Hungarian system.
Sunday, December 18, 2011
Vaclav Havel, 1936-2011
A great man died today.
Vaclav [pronounced "Vatslav"] Havel had been a literary figure and dissident under the Czechoslovak communist regime. He spent four years in communist prisons, but managed to inspire a large following through his plays and other writings. He was an eloquent advocate of democracy.
Havel was one of the first spokesmen for the Charter 77 human rights movement (after the abortive "Prague Spring" of 1968), a leading figure in the Velvet Revolution of 1989, the last president of the state of Czechoslovakia and the first president of the Czech Republic. He died Sunday night at the age of 75 at his country place in North Bohemia. He was one of the greatest Czechs of modern history.
Despite his international prominence and popularity, Havel had become something of a controversial figure in his own country. Radio Prague has published a detailed obituary, describing Havel's accomplishments and related controversies.
The New York Times has a slightly different take.
A curious feature of most biographies of Havel is that while mentioning that the Havel family was wealthy, that Havel's father founded the Barrandov subdivision and movie studio near Prague, and that the family's property was confiscated in 1948 by the communists, no mention is made of the Havels' activities during the Nazi occupation. In fact, the elder Havel collaborated with the Nazi regime, including producing Nazi propaganda films at Barrandov. Here is one account of that period.
It would be unfair to brand the younger Havel with his family's collaboration (he was only three years old when the Germans invaded Czechoslovakia in 1939), and it is hard to imagine Havel himself as a collaborator. Still, it is curious that Czechs still avert their eyes from some details of that period.
Havel himself, during the communist period, referred to Czechoslovakia as "Absurdistan."
Havel's grandfather developed a Prague landmark, the Lucerna ballroom and theater, near Wenceslas square. One hall is decorated with an ironic sculpture of Wenceslas astride a dead horse dangling from the ceiling.
It's a Czech thing.
Vaclav [pronounced "Vatslav"] Havel had been a literary figure and dissident under the Czechoslovak communist regime. He spent four years in communist prisons, but managed to inspire a large following through his plays and other writings. He was an eloquent advocate of democracy.
Havel was one of the first spokesmen for the Charter 77 human rights movement (after the abortive "Prague Spring" of 1968), a leading figure in the Velvet Revolution of 1989, the last president of the state of Czechoslovakia and the first president of the Czech Republic. He died Sunday night at the age of 75 at his country place in North Bohemia. He was one of the greatest Czechs of modern history.
Despite his international prominence and popularity, Havel had become something of a controversial figure in his own country. Radio Prague has published a detailed obituary, describing Havel's accomplishments and related controversies.
The New York Times has a slightly different take.
A curious feature of most biographies of Havel is that while mentioning that the Havel family was wealthy, that Havel's father founded the Barrandov subdivision and movie studio near Prague, and that the family's property was confiscated in 1948 by the communists, no mention is made of the Havels' activities during the Nazi occupation. In fact, the elder Havel collaborated with the Nazi regime, including producing Nazi propaganda films at Barrandov. Here is one account of that period.
It would be unfair to brand the younger Havel with his family's collaboration (he was only three years old when the Germans invaded Czechoslovakia in 1939), and it is hard to imagine Havel himself as a collaborator. Still, it is curious that Czechs still avert their eyes from some details of that period.
Havel himself, during the communist period, referred to Czechoslovakia as "Absurdistan."
Havel's grandfather developed a Prague landmark, the Lucerna ballroom and theater, near Wenceslas square. One hall is decorated with an ironic sculpture of Wenceslas astride a dead horse dangling from the ceiling.
It's a Czech thing.
Thursday, December 1, 2011
Europe In Perspective
Lord Ismay, the first Secretary General of NATO, once observed that the purpose of the alliance was to "keep the Russians out, the Americans in, and the Germans down."
That worked for about twenty-five years, but the dynamics of Europe began to change about halfway through the decade of the seventies. Germany began flexing her economic, political and military muscle about that time. General Alexander Haig, Supreme Allied Commander, Europe (SACEUR) from 1974 to 1979, embraced that change by supporting the appointment of a German general as Deputy SACEUR, filling a position vacated by France when they withdrew from the NATO integrated military structure in 1967.
The truth is, Europeans were never as concerned about the Soviet Union as they were about Germany. Admitting Germany into NATO worried the Soviet Union, but in fact it was aimed more at controlling Germany by embracing them than it was aimed at defending against Moscow.
At the same time, Ismay's goal of "keep[ing]...the Americans in..." was to a great extent for the same purpose. Only America could serve as a counterweight to Germany. In addition, persistent animosities among European nations were so strong that only an outside, neutral power (the US) could moderate these ancient passions.
Reading today's headlines, it seems that nothing much has changed in the past three decades. (I served on the staff of the Supreme Allied Powers, Europe (SHAPE) from 1978 to 1981.) Even in the Euro zone, it appears that the United States continues to be a necessary counterweight to Germany.
That worked for about twenty-five years, but the dynamics of Europe began to change about halfway through the decade of the seventies. Germany began flexing her economic, political and military muscle about that time. General Alexander Haig, Supreme Allied Commander, Europe (SACEUR) from 1974 to 1979, embraced that change by supporting the appointment of a German general as Deputy SACEUR, filling a position vacated by France when they withdrew from the NATO integrated military structure in 1967.
The truth is, Europeans were never as concerned about the Soviet Union as they were about Germany. Admitting Germany into NATO worried the Soviet Union, but in fact it was aimed more at controlling Germany by embracing them than it was aimed at defending against Moscow.
At the same time, Ismay's goal of "keep[ing]...the Americans in..." was to a great extent for the same purpose. Only America could serve as a counterweight to Germany. In addition, persistent animosities among European nations were so strong that only an outside, neutral power (the US) could moderate these ancient passions.
Reading today's headlines, it seems that nothing much has changed in the past three decades. (I served on the staff of the Supreme Allied Powers, Europe (SHAPE) from 1978 to 1981.) Even in the Euro zone, it appears that the United States continues to be a necessary counterweight to Germany.
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