Sunday, June 17, 2012
Greek and French elections have set the stage for the continuing intra-EU conflict over the economic crisisThe Greek parliamentary election appears as of this writing to have resulted in the conservative New Democracy (ND) Party coming in first place, the "Radical Left" Syriza grouping second, and the social-democratic Pasok third. Apparently the ND and Pasok will have enough votes to form a government, essentially continued the current debt-collectors' government for the moment.
France's parliamentary elections also produced a major development, giving President François Hollande's Socialist Party a solid majority, allowing them to form a majority government with no coalition partners. (France's Socialist Party wins runoff, reports say Deutsche Welle English 17.06.2012)
Paul Krugman lays out the rationale for why Syriza may decline to join a Greek governing coalition in And Then What? 06/17/2012. A Greek exit from the eurozone being all but inevitable under any Greek government, why should Syriza sign up to take the blame for the economic disruptions that will follow in the immediate aftermath? If they let ND and Pasok preside over the failure to which their policies have acquiesced by their subservience to the demands of German Chancellor Angela Merkel, Syriza would then be positioned to pick up the pieces politically in the next national elections.
The Greek situation is one piece of the immediate crisis, along with Spain's banking problems and Italy's stalling economy.
But the main immediate political confrontation still looks to be that between Hollande's France and Angie's Germany, focusing on the fiscal suicide pact that Angie is insisting that all EU countries adopt. It would effectively outlaw necessary economic stimulus policies in recessions and depressions. It's just insane for European countries to be writing such a thing into their constitutions. And it shows how badly European leadership has failed in this depression. Angie is leading culprit, but France's former President Nicolas Sarkozy and Britain's David Cameron bear nearly as much responsibility.
A columnist in the Süddeutsche Zeitung adopts a Pollyanna view of the outcome of Greece's election, :
Der größte anzunehmende Unfall ist ausgeblieben. Die Griechen wollen Europäer bleiben. Syriza, die linksradikale Partei, der die Griechen in den letzten Wochen zugeströmt sind, hat zwar noch einmal zugelegt - aber sie hat nicht gewonnen. Gewiss, die Griechen haben die alten Parteien erneut abgestraft, die sie in ihr gegenwärtiges Elend geführt haben. Aber mit Maßen. Denn auch wenn die Wut über die jahrzehntelange Misswirtschaft von Konservativen wie Sozialdemokraten gleichermaßen gewaltig ist, so wollen die Griechen doch in Europa und im Euro bleiben.
In other words, we're going to continue with the same austerity policies that have been failing spectacularly and leading to crisis after crisis: so everything's going to be fine!
Awesome, just awesome.
Tags: angela merkel, austerity economics, eu, euro, european union, france, françois hollande, greece
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No subject for immortal verse
That we who lived by honest dreams
Defend the bad against the worse."
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