Is Germ-exit next?

by Chris Becker

The public image of the European experiment is that it has been setup to bring Europe closer together financially, culturally and strategically, a melting pot of medium-sized States so that one big entity cannot shape or rule the continent’s future.

The reality is Germany rules Europe for Germany. The financial gains for the central power have been enormous as they swapped their expensive Mark for a cheap Euro, foisted cheap credit onto the peripheral economies, and then raked in the export dollars.

But decades of shaping monetary policy, including failed austerity measures in the post-GFC deflationary era, from the inflation-obsessed ECB and their forcing of mercantilist policies on the whole of Europe maybe coming to an end, with France joining in a new alliance with the South. Is there a rebellion against the Empire?

Major EU nations including France, Italy and Spain are clubbing together to form a new alliance with the aim of wrestling back economic power from the German leader.

The leaders of France, Italy, Spain, Portugal, Cyprus and Malta are planning to meet in Athens next month to forge a new anti-austerity alliance with the aim of wrestling back control of the European Central Back (ECB), which sets Eurozone fiscal policy, from Berlin.

It is being headed up by Greek premier Alexis Tsipras, who has frequently clashed with both Mrs Merkel and Brussels over the crippling austerity which has brought his country to its knees.

Preliminary discussions on how to outmanoeuvre the all-powerful German leader had already taken place, with Mr Tsipras and his Italian counterpart Matteo Renzi having held informal talks about the possibility of setting up an “Alliance of Europe’s South” on the sidelines of June’s EU summit. The leaders want the group to push for a pro-growth agenda and will now hold their first meeting in the Greek capital on September 9, according to the Athens News Agency.The participation of France – traditionally seen as the EU’s second most powerful member – will lend huge weight to the project and may make it difficult for Mrs Merkel to continue to resist calls to loosen the purse strings.

Indeed. As was the case before the Great War and World War Two, France remains Germany’s largest trading partner. But its economy continues to suffer from the ECB/EU imbroglio, with its other major partners – all in the South – unable to recover under the boot of austerity.

This is why those – particularly on the “intelligent” left – are wrong to sneer at Brexit, however maligned its originators might be. Because the upheaval is allowing for a “rethink” of how Europe will actually work in a post-Brexit (or not) future – one where the German mercantile juggernaut cannot continue to dominate at the expense of the welfare of hundreds of millions of Southern Europeans.

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Comments

  1. I always thought EU was a mini-UN. If it works, there is no reason that a larger version cannot work. Of course, the reality is that it won’t work.

    Shorting EUR has been one of the easiest bets one can make – I love NIRP.

    Bring on the Germexit!!

  2. reusachtigeMEMBER

    LOLOLOL… a meeting of the lazy states. Will they meet at 10am then break for lunch at 11am, eat a few souvlaki and down a few glasses of retsina, take a nap, then reconvene at 8pm for a quick chat before dinner at 11pm?

  3. Marine Le Pen is polling at 3times the approval of Hollande. The elections are next year.

  4. Britain should join this meeting and make the most of Brexit while pushing Germany further into corner.

  5. The irony of peoplie with maxed out credit cards whinging about their neighbours not loaning them more money.

    You go France, Italy, Spain, Portugal, Cyprus and Malta. Entitlement is alive and well.

  6. Tell ‘im he’s traumin. I spend a fair bit of time there, speak the language and have friends in traditional export businesses in Germany and Switzerland. Enough of that. I have been putting the German/Northern exit argument to them for years and they just laugh. I constantly underestimate their commitment to Europe as I contemplate a long term German property play; I think they know they will need to pay more, but they won’t let the cardhouse collapse. They have massive financial, strategic, cultural and psychological reasons for not allowing this, possibly in that order.

  7. The problem with socialism is that you eventually run out of other people’s money…

    • drsmithyMEMBER

      Just like capitalism, you mean ?

      The real problem with socialism is that it affords the lower and middle classes some semblance of hope their lives can improve. That sort of thing is supposed to be the sole domain of the church and the afterlife. People with hope in this world are much harder to convince to throw their lives away building the latest trophy or fighting the latest war, unlike people who have nothing to lose and the possibility of much to gain from dying.

      • Socialism has its elites too… specialises in collective group think. If you look at the National Socialists, the only main difference between them and Communists, both hated capitalism, but the National Socialists needed the industrial elite (but under their direct control). They just made sure that the industrial elites were their cronies. The Communists just nationalised. BUT – in every other ideal, endeavour and world view both groups were remarkable similar.

        What is truly puzzling is that two movements so close to each other in all ideals, found each other so reprehensible. Until you realise that the truth was is – its all about politics, and which elite ruled… the common man never came into the equation!

        Nor do the capitalist elites – and the truth is, all movements have elite and the trappings of power. All are based around the corruption of man and his fallibility. …the poor will always be with you…

        The Communist countries all claimed that they were Socialist working toward Communism, the collective ideal. All claim that they had yet to reach it. Much the same reason for all the capitalist countries. With the transfer of wealth to the elites; do you honestly think the elites will stay in Oz if you tax them too much – or will they relocated to a lower taxing regime, still invest in Oz, but take the monetary benefit???? You don’t need to answer – always back self interest.

        IMHO, you are not really asking the right questions – its the questions you ask that frame your outlook…