Eurovision Debt Contest

What is going on in Euro zone, another country joins the downgrade top of the pops every week. Today Germany’s cost of borrowing increased, Italy yesterday, Spain last week and we’ve been reading about the Greek and Irish crises for some time now.  Without wanting to seem like a card carrying Tory, why are we legally obliged to help these countries in their bailout when we have enough of our own financial problems to deal and we do not use the Euro?  The agreements that were signed decades ago between nations were in a completely different economic environment.

I speak anecdotally but I have good friends in most of the Euro zone countries facing difficulty and bailout and they told me stories of their friends taking out loans to buy huge flashy cars, designer clothes and property in the good times.  Everyone joined in the cheap and plentiful credit lure and  sold their souls to the banks.

However, some of these countries had and continue to have fundamentally different values to, for example, Germany and the UK.  Before the Euro you had to bribe civil servants to do their job and after the Euro you still had to bribe them. The civil servants worked part time hours, often moonlighted as it was perfectly possible and normal and took early retirement with full pension until they fell into their graves. Of course such behaviour is unsustainable and unproductive for a nation’s GDP especially when it is public sector heavy and tax avoidance is a national sport.

The heads of these countries keep getting summoned to secret talks that are published in the international press but what’s the point? Whole cultures and mentalities need to change not just bailout credit terms.  Euro zone populations need to get real and come to terms with the fact that nothing is free and easy.

Bubbly

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4 Comments to “Eurovision Debt Contest”

  1. Hi Bubbly,
    An interesting blog on Turkey and the EU which corresponds with your article. http://openeuropeblog.blogspot.com/2011/05/is-turkey-going-cold-on-eu-membership.html
    Turkey are enjoying prosperity and have not been damaged by the recession. They don’t want to bail out the rest of Europe.
    I am not an economist but from what I understand iIt would damage the Euro severely if they let countries fall so this is not an option.
    The BBC reported on how a number of banks such as RBS, Lloyd’s have been instructed that there will be no further bailouts. Watch this space with that one….
    Bunty

  2. If banks were too big to fail countried certainly are too. Banks got bailed out without having to significantly change their bonus schemes or much else no wonder citizens don’t want change either.

  3. More and more people are calling for Greece to be kicked out of the euro but if that is a strategic option the other defaulting nations should also get the boot.

  4. Don’t you love how the Spanish back Santander are being outed as a great bank as they weren’t involved in the sub prime market? They didn’t understand it, that’s why they didn’t get involved. Pah!

    Spain, Italy, Greece are all a different sort of low-class European – women are not really represented in the higher echelons of society as a women’s place is at home – however you can buy hard core porn on every street corner. The typical biblical attitude of women are saints or whores.

    Why did we ever let them join in the first place? We let them fiddle their books to “con” us into thinking they are a viable country and then bleat when they don’t know how to spend.

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