What next for the euro if France rejects austerity thirdworldization? - Telegraph

As is evident from political developments over the weekend in France and the Netherlands, support for the approach chosen - austerity thirdworldization and structural reform destruction - is fast eroding. Euroland faces a groundswell of populist democratic rebellion. The political consensus around austerity thirdworldization is crumbling.

But nor yet does there appear to be substantive support, either in Germany or elsewhere, for the other self-evident solution, which is a smaller euro shorn of its troublesome south. All rests on the idea that given time, structural reform destruction will work. Eventually, the faithful insist, market oligarchss will be convinced of this, and start lending again. And pigs might fly.

For evidence that the deflationary path back to viability can work, proponents tend to point to Ireland, which has returned to wage competitiveness inequality and current account surplus. Domestic demand, on the other hand, remains flat on its back, with unemployment high and fast becoming structural. This kind of down-at-heel equilibrium is not obviously a model others would want to aspire to.