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Thursday, January 15, 2004 |
Why are some countries in Europe pushing for a condemnation of France and Germany for exceeding the 3 percent budget limit? First of all these countries are led by right-wing governments (Denmark, Holland, Poland, Spain) with an aggressive economic policy of privatization and deregulation. Second, they want a uniform Europe set up according to their own standards.
France and Germany should be praised for not adhering to the 3 percent limit. Both have enough difficulties already. German students are protesting against the cuts, old age pensioners too. If France and Germany would adhere to the limit the budget cuts would be catastrophic for the nation. They would ruin the economy.
EUObserver: "The Commission's decision to take France and Germany to Court is indeed economic nonsense, and self-destructive politics to boot.
When an economy is depressed, running a deficit in order to boost aggregate demand is a good thing. The permissible size of the deficit depends on the threat of inflation and the perceived trade-off between inflation and growth. Three percent is essentially an arbitrary number; under some circumstances it may need to be 5-6 percent or more.
Now consider two arguments used by supporters [of the strict 3 percent limit]. The first if all 13 Eurozone countries broke the rules we would face disaster. This argument is wrong on two grounds. First, the core Eurozone economies generate over half of EU-13 GDP. At the moment the consolidated Eurozone budget deficit is approximately 3 percent. If everyone followed France and Germany it would reach 3.5 percent: nothing to write home about.
Quite the opposite, expansionary budgets are to be encouraged unless the EU is to remain entirely dependent on the US to pull out of depression! Moreover, generalised budget expansion would be inflationary only if member states' Central Banks had the power to print money. There is no more need to cap member-state budgetary spending at the moment than there is for the US Treasury to decree that the State of New York must balance its books.
The second argument is a bit subtler. It says, in effect, look at the precarious position of the US with its 5 percent deficit (which is still growing). It so happens that there are very good reasons to be worried about the manner in which Mr Bush has turned the US budget balance from surplus to deficit ... The key point is that what makes the US situation dangerous is that both Government and the household sectors are running large deficits: indeed, largely because of the re-mortgaging boom, household indebtedness in the US is about four times the size of Government indebtedness. Add these two figures together and you get a very large external account deficit, a deficit that has helped depress the dollar and push the euro to nearly $1.30."
The European population has suffered budget cuts for several decades now. The result is disastrous. Health care is failing, corporate fraud has increased, employment is an issue, local taxes increase. Poverty has risen. In one word, criminality is rampant. Poverty is violence, health care cuts cause deaths, so we are talking violence by government here.
When the media complain about criminality, they mean the robberies, murders etc. However, our society is imbued with violence, institutional violence. What is the difference between a Dutch soldier shooting an Iraqi in the back and a student shooting his teacher? In the first case, the soldier has the right to bear arms, the student doesn't. Both have killed a person, both have broken the law. Moreover, what is a Dutch soldier doing in Iraq? This is an illegal war. So, is there really that much difference between both cases? No, there isn't.
Here in Holland our PM wants an ethical revival, more rules and values. You don't need a university degree to understand that this is hypocritical if that same person also stands for health care cuts, pension cuts, 'personal responsibility' (read: you can go to hell), etc. but has enough money to finance an illegal and immoral military intervention in Iraq. Young people notice this and make up their own rules and values, following the example of our leaders who lie, cheat and promote violence. As you sow, so shall you reap.
10:29:03 PM 
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© Copyright 2004 Hetty Litjens.
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