Merkel’s Miracle (?), Sarkozy as Humpty Dumpty and the Euronomy

By Jamie Douglas

Angela Merkel and the EU Summit

For all the expats living in different parts of the globe, our financial problems are sort of shared. While some of us, like myself, have had to adjust to live more frugally, struggling with Argentina’s real inflation being around 23%, some are much better off at the moment, those of you who have sufficient assets to weather this and the next few crises. But there is no doubt that the Eurocrisis, as it is presently unfolding day by day, has worldwide effects, and what will happen in real time, in the real world remains to be seen.

While members of the European Parliament were warm and cozy inside the EU council building in Brussels, outside in the bitter cold, freezing striking Belgian workers opined early about the outcome, which once again is raising fear over German dominance. The banners flying in the cold air were pretty unanimous in their condemnation of the accord reached by 25 of the 27 member states. (The UK and the Czech Republic refused to go along.) The strikers shouted “No to the Savings Pact – Yes to solidarity! The workers of course will once again bear the brunt of their government leaders’ fiscal follies over the past decade, when it seemed that the economic engines would run forever on the artificially created wealth of not just the Euro Zone, but the whole civilized world.

No doubt, those striking workers were not very long ago the beneficiaries of generous salaries, benefits, and bonuses that were the envy of Western (U.S.) civilization. But all that generous spending on infrastructure that employed millions across Western Europe was financed by sovereign obligation bonds, which in spite of wishful thinking have to be repaid, even in dire economic times. Some of the indebted nations of course never looked at the reality of default. Argentina, it was assumed, was an exception, and no member state of the EU would be allowed to default.

So Merkel has rammed through a fiscal pact, which as its center piece features binding limits on budget deficits with quasi-automatic punishments on nations breaching the deficit and debt ceiling. OK Greece, Ireland, Spain, Portugal, Italy, and France: line up against the wall for your date with the firing squad!

On Friday, January 27, 2012 there were rumors flying about that the Germans wanted to install an EU budget commissioner in Greece to monitor their fiscal behavior. The Greek’s of course screamed bloody murder about this proposal and called it a “sick fantasy” while demanding respect for its national dignity (insert hollow sound of laughter).

Nicolas Sarkozy aka Humpty Dumpty

With every passing day that the French election get closer, it is becoming increasingly apparent that Angela Merkel’s little Hungarian lapdog, Nicolas Sarkozy, is nearing his last term as president of the Gaullist nation. He has fallen off the wall and not all of France will be willing or able to put him back together again.

France as a whole is deeply embarrassed about his spineless rolling over for the German commands, his receiving of nothing at all in exchange, and that in the process he caused the loss of his country’s valued AAA rating because of the chaos in France’s fiscal household. The nation is deeply in debt, and to no small extent because of its expensive maintenance of its overseas territories, such as French Polynesia and New Caledonia, as well as several of the Caribbean islands.

The coming contest, which was to be fought with Dominique Strauss-Kahn, an unfortunate philanderer like Herman Cain, will in all likelihood be dominated by Socialist frontrunner Francois Hollande, who has already announced that he will immediately call for renegotiations for the just agreed upon treaty on fiscal discipline, when he is elected, which seems more of a possibility every day.

Bonus Rant

Stay tuned in these exciting weeks and months to come, where even the most educated and revered economists like Nobel Laureate Paul Krugman are freaking out. To no one’s surprise he is also controversial for speaking out against the economic models created by the Chicago School of Economics, Milton Friedman, Ayn Rand and the long serving Chairman of the Federal Reserve Alan Greenspan, who just put the economy on autopilot, deregulating with a great fervor and getting us into the fix we are in today. Amazingly, his original tenure began under the presidency of Ronald Reagan in 1987 and his wrath of regulatory destruction did not end until 2006, after many of the insane financial products had been created and marketed worldwide. (See Lehman Brothers and Country wide.) If there is one person who I would hold responsible for the financial meltdown, it would be Alana Greenspan, who had become a member of Ayn Rand’s inner circle, advocating “Objectivism,” a better name for which is my interpretation, “Capitalism without a conscience!”

Jamie Douglas

San Rafael, Mendoza

I encourage you to write to me, jamie@expatdailynews.com with any questions or suggestions you may have. Disclaimer: I am not in any travel related business. My advice is based on my own experiences, and is free of charge. (Donations accepted). It is always my pleasure to act as a beneficial counselor to those who are seekers of the next adventure.

To read more of Jamie’s opinion articles, see Voices From Exile. You can also contact Jamie at jamie.douglas [at] yahoo.com

See more expat articles at Expat Daily News Latin America