European Crisis 101.. please?

[R_P_A_S]

Could someone please tell me why Europe is having issues with debt and the Euro? What exactly happened? What's to blame? How come Germany is not hurting but Italy is? etc..

With China now criticizing the social-democratic labor policies and labor law being out dated it has me really wondering what's going on? Any links, or recommended reads will be appreciated it. Thank you!

[Zukunftsmusik]

The norwegian - or is it the nordic - version of Le monde diplomatique had an issue in july where they analysed the crisis. I don't remember everything, so I think I'll have to reread it. Anyway, there was for example an article by Damien Millet and Eric Toussaint (that name basically means halloween AFAIK), if I'll try to rewrite the the title from norwegian, it would be something along the lines with this "Must the debt be (re?)payed?" And that's quite bad english, so I guess it's called something else.

Anyhoow, here's another article I found by the two: http://www.globalresearch.ca/index.php?context=va&aid=25638

Great initiative, have been thinking of making a similar thread. Hope other, more enlightened people than me join in as well.

[blackandyellow]

Southern Europe has little industrial base, but northern europe does - and northern european economies are quite strong. this makes the Euro valued too high for southern europe so the traditional advantage of a low exchange (making what they sell cheaper) they would have to encourage growth isnt there in the Euro. Another way for them to grow would have been an industrial policy, but the Euro forbids this. This gap in their economy has been glossed over with high public defecits in some ways (made easier due to initial lower borrowing rates thanks to the Euro), as well that their economies havnt been able to grown enough to keep up their maintaining of their public services. Now that growth has completly gone and their economies have shrunk due to the 2008 crisis, an added increase in spending due to unemployment claims, loss of revenue from shut down business, its become unbearable.

There are also anecdotes such as Greece pretending they had a 3% public defecit when they actually had a 15% one, Greek millionaire plastic surgeons claiming to earn below an income level resulting in paying tiny ammounts of tax, corruption thats costs money e.g. the whole scandal with land and a Greek monastry etc

[Cencus]

When the Euro was set up the Mastricht criteria was a set of financial hurdles every state was meant to pass before they could join. The problem was everyone including Germany cooked the books in order to pass these criteria. Debts were hidden, assets were overvalued (Germany revalued it's gold reserves, The UK introduced PFI a way of getting private companies to front for large capital projects). So from the start the Euro was based on very shakey foundations. Along comes the sub prime fiasco a lot of European banks take a pretty big hit and the whole house of cards comes tumbling down.

[R_P_A_S]

thanks for the info. I hope some more people contribute..

[El Louton]

What happened? Capitalism happened.

[R_P_A_S]

I haven't read thoroughly on all of his stuff but he goes in great depth about the crisis among other things.

http://thenextrecession.wordpress.com/category/marxism/

[blackandyellow]

What happened? Capitalism happened.

Very insightful

[El Louton]

Very insightful

Why thank you!