The European Disunion – will the euro survive? (16-bumped)

As the currency crashes and the Continent is swept by protests, even key members such as Germany and France are starting to think the unthinkable about the euro.

Like many of Spain’s 4.5 million unemployed, Cinthia Carvajal is on the verge of despair. The 41-year-old marketing executive has jobhunted non-stop for the last six months, but with the country in the grip of its worst recession in 50 years, there are precious few firms needing anything to be marketed.

She will now take whatever job she can find, but with unemployment running at 20 per cent nationally, the few offers come her way are generally less than tempting.

“I spend my whole time going for interviews,” said Ms Carvajal, who receives €475 (£388) per month in unemployment benefits. “But often they want you to work on the black market to avoid paying taxes, and I’m not prepared to do that.”

Spain’s jobless rate is currently double the the average for the euro zone, rising to nearly 32 per cent in places like Cadiz, a windswept port that has never recovered since its shipbuilding yards went the same way as those on the Clyde.

The economy shrank nationwide by nearly four per cent last year, and in the bars of Cadiz’s winding, cobbled streets, the sense is that things can only get worse – which, last week, they effectively did.



Hannan: As the euro fails, Brussels turns on us to save itself


1:26 pm EDT, May 23rd, 2010 — Berliners dream of return to deutschmark

1:29 pm EDT, May 23rd, 2010 — Leading article: Can it be the beginning of the end?

1:31 pm EDT, May 23rd, 2010 — Officials told to prepare £8bn taxes on the banks

1:32 pm EDT, May 23rd, 2010 — Broke Britain ‘can no longer afford role in Afghanistan’

1:33 pm EDT, May 23rd, 2010 — ‘Age of plenty’ is over warns Clegg as he condemns Labour’s ‘black hole’ in finance

1:35 pm EDT, May 23rd, 2010 — EU crisis makes cuts imperative says Clegg as Queen’s Speech is leaked

1:37 pm EDT, May 23rd, 2010 — Coalition considers plan to sell off Britain’s roads

1:39 pm EDT, May 23rd, 2010 — Hanson: The New Old German Problem

1:40 pm EDT, May 23rd, 2010 — Dalrymple: Reawakening Germany’s Nationalism — What Could Go Wrong?

1:42 pm EDT, May 23rd, 2010 — Must-Read Paragraph Of the Day

1:52 pm EDT, May 23rd, 2010 — It Takes a Crisis to Make a Continent

2:00 pm EDT, May 23rd, 2010 — Legendary Investor Is More Worried Than Ever


2:18 pm EDT, May 23rd, 2010 — A future without the euro is a distinct possibility

2:28 pm EDT, May 23rd, 2010 — The Big Fat Greek Debt Crowd-Out

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  • Cynapse

    Canada is not a major producer of electronics, and the tariffs on Japanese imports would have kept us well behind.  There’s no way the auto sector would have expanded to what it was without the export factor.  Plus in general, as mentioned before, Canada is too poorly populated and spread out to not have the prices go through the roof on even basic goods (and that’s even before considering labour costs)


    Your eugenic approach to health-care, certain to eliminate many car accident victims etc, probably won’t help either

  • dlm

    “All of that would very dependent on having a foreign market for those goods.” Not at all Cy. The proposal was isolation. Canadian manufactured goods for Canadian markets. Prohibitive tariffs on all imports, which would of course be reciprocated, ensuring plenty of Canadian products at reasonable prices at home. The only thing we really needed to import was good people. No foreign ownership of anything would have encouraged investors to become citizens. Our growth rate would have been very different. We probably would not have been able to afford publicly funded health care which would have meant those so imprudent or unlucky as to have failed to put something by for emergency would not be breading more weak and dependent people.

  • dlm

    I pray that you are right Jack. We COULD be completely self reliant save national defense and we may yet depend on the Americans for that a while as they regard our resources as their reserves. (the price of this may ruin us) But self confidence is prerequisite to self reliance and I see too little of that.
    I am Quite miffed that CUPE members get nearly double (benefits in) what I get for the same job… How about: public sector unions are replaced by a comity which determines the average local wage for that job in the private sector and that’s what they get. Employees Association for grievance? We would save millions in union executive compensation alone. Betcha a nickle that won’t fly.

  • Cy

    All of that would very dependent on having a foreign market for those goods, dlm, since the Canadian market (and especially one with a restricted immigration policy of any kind) is too small and sparse to support any kind of advanced industry by itself.

    The tariff backlash would pretty much sink your dream since those tariffs would be raised to the point where most nations would not see it worthwhile to import Canadian goods. They’d still be consuming cheap Chinese goods and we’d either have to follow suit or accept a lower standard of living for our expensive goods.

  • Jack

    Re: #2 — “But it is far to late now.”

    I disagree.  We can still play “turtle” and pull in our head.  Truth be told we don’t need “imports” to supply our people in this country with the goods they require.  We can do it ourselves and we don’t need anyone (everyone working — inventingwhat have you).

    We can do this stuff because we are completely self-reliant.

    But first we must deal with unions and they are not going to like this idea one bit because they are into this “globalization” theme and selling our country out.

    I’m far from certain I’m correct but it is a thought to sleep on.

  • dlm

    You are right to worry Jack. I have been roundly criticized for promoting Canadian isolation since Diefenbacker failed to protect our superior cast iron industry against cheap and inferior Taiwanese imports. Had we then embarked on a policy of protectionism and strict self interest in immigration policy, we would have developed strong Canadian industries utilizing our advantage of abundant natural resources. The resulting tariff backlash against us would have insured superior Canadian products in Canadian homes and a strong dollar at home, if nowhere else. But it is far to late now. We are so dependent on the US, we hardly dare hint that we might like to get out of the IMF.
    I would like to see Canada a member of NORAD and NATO and NO other international organizations.

  • Jack

    I’ve felt like Cassandra the past few weeks as I continue to watch this slow motion trainwreck.  What strikes me is how inter-related world economies are (globalization) and I’m continually asking myself if that is a good thing as I wonder what will happen in Canada in the years ahead.

    In light of the recent US mess and then this latest one in the EU the answer appears to be a resounding “NOT”.  I’m also thinking that a great talking point for Cabinet would be how wise it is to remain within the IMF.  After all, as a Canadian taxpayer I want no part of bailing out countries like Greece and this is where my nose is pointing me.  At some point (if we remain) we are going to get hammered for the fiscal stupidity and asinine dreams of others far away.

    I worry about that as I consider that the world is once again “about 1937” and the “kak” is about to hit the fan.

    I say that because Hanson pointed out in his article that Germany is a very dangerous enemy and there is no way they are going to go into servitude to save the EU. That won’t happen and Hanson is correct as is Dalrymple. Germany will bail and look after itself first (as it should) if things continue to deteriorate. That brings up an entirely new situation as Germany re-arms and takes a very jaundiced look at Iran with the hint “Do you really want to go there?”

    I can’t picture any western country taking Iran’s side as they confront a real “boogy monster”. Frankly, I can’t picture any country at all going there.

    Perhaps Germany vacating the EU, rearming and building it’s own nukes is just the thing that might save the world from another global war as the Arabs settle down.

    I don’t know but I will say this. Germany has paid it’s bill and tried every way it can to get along in the days since WW2. But German people are not idiots and there is a point where they say “whoa” — enough.

    I think that day is very close.