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EU Business News: France has obligation to reverse budget deficit: Moscovici (27 December 2012)
"In the past 30 years, France has not been able to pass a balanced budget. State debt rose to an unacceptable 1.7 trillion euros ($2.2 trillion) in 2011. It is our duty to reverse this," Moscovici wrote in a column for the German business daily Handelsblatt.

France intends to lower its deficit to the European Union's ceiling of 3.0 percent of gross domestic product next year and start bringing down its debt from 2014, the minister said.

"This is an ambitious plan and we intend to implement it without striving for an old-fashioned budget policy of tax and expenditure increases," he said.

I've said it before and I'll say it again:
If Eurozone countries (except Germany) have a persistent current account deficit averaging close to 3% (and, on current trends, soon to exceed it), and at the same time the government deficit must remain below 3%, it becomes mathematically impossible for the Eurozone private sector (outside Germany) to net-save. This is unsustainable, because if the private sector is dissaving eventually it will become insolvent.

Take, for example, France:

If France were to bring its Government deficit below 3%, it would destroy the ability of the French private sector to net-save, assuming the current account deficit stays on trend (and it should: Germany's 6% current account surplus is as stable as if it were a successful policy target, and the Eurozone's neutral current account balance is consistent with the ECB pursuing a non-interventionistic foreign reserve policy).



I distribute. You re-distribute. He gives your hard-earned money to lazy scroungers. -- JakeS
by Migeru (migeru at eurotrib dot com) on Thu Dec 27th, 2012 at 08:14:17 AM EST
[ Parent ]
Oh dear, there goes the Spanish democratic constitution.

I used to think that the upcoming Greek coup/civil war would knock some sense into these people. Now I think that 2017 will be Bayrou beating LePen, and then proceeding to disintegrate under the weight of his useless economic policies, giving us an FdG vs. FN second round in 2022. Fifteen back-to-back years of industrial depression, that has to be in the top three of recorded history.

The Greek, Spanish and Portuguese constitutions won't survive another decade of business as usual. And France is the swing vote, and under the French system there is no mechanism for a failing government to result in early elections.

And if we're really lucky, the FN puke might win in '22.

[Jake's Crystal Ball of Doom™ Technology]

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu Dec 27th, 2012 at 08:28:11 AM EST
[ Parent ]
Yeah, that sounds about right, there will be right-wing authoritarian coups in Germany and France in 2022:
	Germany 	France
2013	Merkel + FDP	Hollande
2014-6	Merkel + SPD	Hollande
2017	Merkel + SPD	Bayrou
2018-21 Merkel + Greens Bayrou
2022	Die Linke	FdG


I distribute. You re-distribute. He gives your hard-earned money to lazy scroungers. -- JakeS
by Migeru (migeru at eurotrib dot com) on Thu Dec 27th, 2012 at 08:44:33 AM EST
[ Parent ]
Is that you going on record with these predictions?
by Nomad on Thu Dec 27th, 2012 at 08:48:47 AM EST
[ Parent ]
No, he's just writing down all our nightmares

keep to the Fen Causeway
by Helen (lareinagal at yahoo dot co dot uk) on Thu Dec 27th, 2012 at 08:54:13 AM EST
[ Parent ]
Happy to be of service.

I distribute. You re-distribute. He gives your hard-earned money to lazy scroungers. -- JakeS
by Migeru (migeru at eurotrib dot com) on Thu Dec 27th, 2012 at 08:55:31 AM EST
[ Parent ]
Italy?
by gk (gk (gk quattro due due sette @gmail.com)) on Thu Dec 27th, 2012 at 08:57:28 AM EST
[ Parent ]


Friends come and go. Enemies accumulate.
by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu Dec 27th, 2012 at 09:00:59 AM EST
[ Parent ]
Who against who? Right vs. Left, North vs. South, Florence vs. Siena, etc.?
by gk (gk (gk quattro due due sette @gmail.com)) on Thu Dec 27th, 2012 at 09:14:16 AM EST
[ Parent ]
Is there a plausible political disintegration scenario for Italy?

(I know Italy is politically disintegrated. I mean a loss of the ability to keep up the charade of functioning country-wide political institutions)

I distribute. You re-distribute. He gives your hard-earned money to lazy scroungers. -- JakeS

by Migeru (migeru at eurotrib dot com) on Thu Dec 27th, 2012 at 09:20:21 AM EST
[ Parent ]
I would expect the north to attempt secession once the money gets really tight (to "avoid paying for the lazy, spendthrift, mafia-infested south"). Rome will send in the Carabinierie, because that's what they usually do to uppity provincials. And because it's comparatively affluent Milanese who will get the same treatment the Carabinierie usually give Neapolitans, it'll get upgraded to "civil war" in the English-speaking press.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu Dec 27th, 2012 at 10:34:11 AM EST
[ Parent ]
That's basically the Catalan scenario in Spain, coming soon to an uppity province near you.

Could it happen in this way in Flanders, too?

I distribute. You re-distribute. He gives your hard-earned money to lazy scroungers. -- JakeS

by Migeru (migeru at eurotrib dot com) on Thu Dec 27th, 2012 at 10:56:51 AM EST
[ Parent ]
the upcoming Greek coup/civil war
Starting when?

I distribute. You re-distribute. He gives your hard-earned money to lazy scroungers. -- JakeS
by Migeru (migeru at eurotrib dot com) on Thu Dec 27th, 2012 at 09:03:55 AM EST
[ Parent ]
My over/under for the next Greek election is next summer. Syriza will win, and then the creditors will retaliate. And I'm betting that the outgoing government has made absolutely no useful contingency plans for suddenly-imposed autarky.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu Dec 27th, 2012 at 09:08:11 AM EST
[ Parent ]
Will Syriza be allowed to win? Remember the European powers approved of the suspension of democratic elections in Algeria in 1991 when it looked like the wrong guys might win.

I distribute. You re-distribute. He gives your hard-earned money to lazy scroungers. -- JakeS
by Migeru (migeru at eurotrib dot com) on Thu Dec 27th, 2012 at 09:18:35 AM EST
[ Parent ]
Suspending elections would not suffice under that scenario - you'd have to dismiss parliament and impose rule by executive fiat.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Thu Dec 27th, 2012 at 10:38:41 AM EST
[ Parent ]
Oh dear, there goes the Spanish democratic constitution.

...

The Greek, Spanish and Portuguese constitutions won't survive another decade of business as usual. ...

You should have seen the King of Spain's Christmas Eve speech. It was at once depressing and infuriating. Especially in its defence of business as usual. If it had come in 2007 I would understand it, but in 2012...

I distribute. You re-distribute. He gives your hard-earned money to lazy scroungers. -- JakeS
by Migeru (migeru at eurotrib dot com) on Thu Dec 27th, 2012 at 09:07:35 AM EST
[ Parent ]
Die Linke and FdG = nightmare?

The Hun is always either at your throat or at your feet. Winston Churchill
by r------ on Fri Dec 28th, 2012 at 04:39:07 AM EST
[ Parent ]
No, the coup to prevent them from winning.

I distribute. You re-distribute. He gives your hard-earned money to lazy scroungers. -- JakeS
by Migeru (migeru at eurotrib dot com) on Fri Dec 28th, 2012 at 04:43:10 AM EST
[ Parent ]
are in the ranks too.

The Hun is always either at your throat or at your feet. Winston Churchill
by r------ on Fri Dec 28th, 2012 at 05:32:29 AM EST
[ Parent ]
The, by then, fifteen back-to-back years of preceding depression qualifies.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Fri Dec 28th, 2012 at 05:21:21 AM EST
[ Parent ]
he's done.

Probably some other somewhat wishy-washy centre right personnage, perhaps NKM.

The Hun is always either at your throat or at your feet. Winston Churchill

by r------ on Fri Dec 28th, 2012 at 05:31:48 AM EST
[ Parent ]
who?

I distribute. You re-distribute. He gives your hard-earned money to lazy scroungers. -- JakeS
by Migeru (migeru at eurotrib dot com) on Fri Dec 28th, 2012 at 05:53:57 AM EST
[ Parent ]
She's an up-and-comer untainted by the stink of the Copé v. Fillon UMP title fight which is in the later rounds. The UMP is a lot of mushy right-wingers who sound tough on various social and immigration and national identity issues but are in practise about the same as the PS when it comes to Europe (though Hollande "means well" and says a lot of nice ineffectual things about growth and solidarity, like a good social democrat), which is as we likely agree at the core of what the economy will (well, more won't) do in the next decade.

The center is irrelevant here, especially Bayrou, imho, it'll be UMP after the failed Hollande presidency, they'll do similar things of course but it will sound different.

The Hun is always either at your throat or at your feet. Winston Churchill

by r------ on Fri Dec 28th, 2012 at 07:04:43 AM EST
[ Parent ]
I agree that

  1. Bayrou is no longer a contender
  2. After Hollande, a "UMP" is most likely to take over.
by afew (afew(a in a circle)eurotrib_dot_com) on Fri Dec 28th, 2012 at 08:01:37 AM EST
[ Parent ]
JakeS:
Fifteen back-to-back years of industrial depression, that has to be in the top three of recorded history.

And as such it deserves a name.

The Great and Long Depression? Not so snappy.

The Stupid Depression? Nah.

The Greatest Depression? Perhaps.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Fri Dec 28th, 2012 at 12:58:16 PM EST
[ Parent ]
Following the nomenclature of the great wars, I would say the second world depression. With the "great depression" being renamed to the first world depression, just like the "great war" was renamed the first world war.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Fri Dec 28th, 2012 at 06:44:44 PM EST
[ Parent ]
WD I, WD II
by afew (afew(a in a circle)eurotrib_dot_com) on Sat Dec 29th, 2012 at 01:46:07 AM EST
[ Parent ]
Apparently in the US the Long Depression of 1873-96 was originally called the Great Depression, until in the 1930s a deeper (but shorter) economic contraction occurred.

I distribute. You re-distribute. He gives your hard-earned money to lazy scroungers. -- JakeS
by Migeru (migeru at eurotrib dot com) on Mon Dec 31st, 2012 at 04:42:11 AM EST
[ Parent ]

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