Italy and the EU

[Nick]

I'm seeing reports, not the crazy ones saying our economy will drop 35%, but the realistic ones that forecast a 5.5% shrink in the UK economy due to CVD19. The same economists are forecasting 9% to 10% for the EU states. Germany will do what ever it needs to protect it's self and stuff the other 26 members. The Dutch are already playing dirty and upsetting the others, with a bit of luck there will be no EU to negotiate with when this is over.

[Javert]

∆∆∆

I wasn't there, but this account seems to tally with what I've heard from various academic and finance sources over the years.

https://www.bbc.co.uk/news/world-europe-16834815">https://www.bbc.co.uk/news/world-europe-16834815



And a BBC business report on how "Italy has moved to centre stage in the eurozone debt crisis" is also interesting. However, Italy as a whole (ie, not just government) does not appear to be as badly indebted as some other big economies...

https://www.bbc.co.uk/news/business-15429057">https://www.bbc.co.uk/news/business-15429057

Yes but it's not at all clear to what extent, if at all, the EU colluded with that or was aware of it.  Certainly the EU can be accused with hindsight of negligence in their due diligence there, but not necessarily of direct corruption.

[patman post]

Pat, don't you agree that the only way the EU can truly function as a bloc is with political and monetary union. If it does not become a united country, similar to the USA the currency will always be a damaging millstone to poorer countries, whilst perhaps a limiting factor to Germany as for them the currency is undervalued?

Perhaps. But not being a constitutional expert, I can see sizable variations in the government of the different states in the US — eg, in taxes, laws, law enforcement, even some with their own military, etc, behaving almost as separate sovereign countries.

The US constitution and amendments takes only four pages in my Websters, whereas what passes as the EU constitution is reputed to have 265 pages (made up of 60,000 words) in English. Also the US Congress has 535 members while the European parliament has 751 MEPs.

So, for me, it appears that the EU should already have the ability to exert as much, if not more, control over its members than the USA legislature. However, I see the EU as having lost its way by concentrating too much on the minutiae when trying to realise the aims of the founders, and losing sight of the bigger picture...

[Barry]

Pat, don't you agree that the only way the EU can truly function as a bloc is with political and monetary union. If it does not become a united country, similar to the USA the currency will always be a damaging millstone to poorer countries, whilst perhaps a limiting factor to Germany as for them the currency is undervalued?

[patman post]

∆∆∆

I wasn't there, but this account seems to tally with what I've heard from various academic and finance sources over the years.

https://www.bbc.co.uk/news/world-europe-16834815">https://www.bbc.co.uk/news/world-europe-16834815



And a BBC business report on how "Italy has moved to centre stage in the eurozone debt crisis" is also interesting. However, Italy as a whole (ie, not just government) does not appear to be as badly indebted as some other big economies...

https://www.bbc.co.uk/news/business-15429057">https://www.bbc.co.uk/news/business-15429057

[Barry]

Can't see the Italians wanting to leave the Eurozone fold either. The irony is that Greece and Italy had their books fudged to enable them to join in the first place...

Really? Who knew that the EU would accept fudged books to boost their numbers. Was that for the good of the Union?

Apparently not, because the legacy of that lingers on and on.

[patman post]

∆∆∆

Could be, but no one — not even Greece, when it had the chance and good reason — has reverted.

"Greeks didn't want austerity, they didn't want the drachma either. So they ended up with austerity and a depression instead." — Money Morning Newsletter 17/04/2020

Can't see the Italians wanting to leave the Eurozone fold either. The irony is that Greece and Italy had their books fudged to enable them to join in the first place...

[Nick]

EU finance ministers agreed a 500-billion-euro (Dh2 trillion) rescue Thursday for European countries hit hard by the coronavirus epidemic, but put aside demands from Italy and France for pooled borrowing.

The ministers, however, set to one side a proposal from Italy, Spain, and France for a joint borrowing instrument, sometimes dubbed a "coronabond", that would have raised money towards a recovery after the outbreak.

The package agreed is worth about 500 billion euros, short of what many observers believe is necessary to restart the European economy when the health crisis recedes.

Data indicate that the economy across the continent is already in a historic meltdown, with everyday life paralysed to fight the spread of the virus.

Despite 19 EU countries sharing a common currency, member states have reacted unilaterally to save their economies, giving richer countries such as Germany a big advantage over those with less spending power.

The mutualisation of debts was a bridge too far for Berlin and The Hague, which refuse to take on joint loans with highly indebted states such as Italy, France or Spain which they consider too lax in their public spending.

https://gulfnews.com/world/europe/coronavirus-eu-finance-ministers-agree-500b-euro-covid-19-rescue-deal-1.1586473143243">https://gulfnews.com/world/europe/coron ... 6473143243">https://gulfnews.com/world/europe/coronavirus-eu-finance-ministers-agree-500b-euro-covid-19-rescue-deal-1.1586473143243



Seems like an understandable German response — aid by all means, but we're not going to be responsible for other people's ongoing debts...

Looks like being an independent nation with its own currency is the way to go!!

[patman post]

EU finance ministers agreed a 500-billion-euro (Dh2 trillion) rescue Thursday for European countries hit hard by the coronavirus epidemic, but put aside demands from Italy and France for pooled borrowing.

The ministers, however, set to one side a proposal from Italy, Spain, and France for a joint borrowing instrument, sometimes dubbed a "coronabond", that would have raised money towards a recovery after the outbreak.

The package agreed is worth about 500 billion euros, short of what many observers believe is necessary to restart the European economy when the health crisis recedes.

Data indicate that the economy across the continent is already in a historic meltdown, with everyday life paralysed to fight the spread of the virus.

Despite 19 EU countries sharing a common currency, member states have reacted unilaterally to save their economies, giving richer countries such as Germany a big advantage over those with less spending power.

The mutualisation of debts was a bridge too far for Berlin and The Hague, which refuse to take on joint loans with highly indebted states such as Italy, France or Spain which they consider too lax in their public spending.

https://gulfnews.com/world/europe/coronavirus-eu-finance-ministers-agree-500b-euro-covid-19-rescue-deal-1.1586473143243">https://gulfnews.com/world/europe/coron ... 6473143243">https://gulfnews.com/world/europe/coronavirus-eu-finance-ministers-agree-500b-euro-covid-19-rescue-deal-1.1586473143243



Seems like an understandable German response — aid by all means, but we're not going to be responsible for other people's ongoing debts...

[cromwell]

And how to make sure your country isn't left out in the cold

https://www.bbc.co.uk/news/world-europe-52224838">//https://www.bbc.co.uk/news/world-europe-52224838

[T00ts]

I dare say, T00ts, the whole of the EU parliament are "working" from home and doing sweet nothing, and every constituent country and the rest of the world have not noticed a thing.

 ::

I wonder if they will ever come to an agreement on the new budget. Didn't they kick that down the road a while back? You say the EU is doing nothing but aren't they busy demanding fines? They'll be lucky to get those.

[Barry]

I dare say, T00ts, the whole of the EU parliament are "working" from home and doing sweet nothing, and every constituent country and the rest of the world have not noticed a thing.

 ::

[T00ts]

Reports from Spain



Looks like Italy and Spain will have to pay their own bills.

I have seen reference to the EU calling for solidarity but it  seems to stop short of any real  financial emergency help. It makes me wonder just what the top heavy organisation is really for. I guess each member is so focused on problems within their own border that they fairly naturally can't stretch their sight to who else might be in an even worse position. This may well lead to a general collapse that will bite when hopefully the virus has passed.

[Barry]

The EU is interesting. It's being played down but I think there is real friction.

Reports from Spain

In an opinion article published on Sunday in EL PAÍS and other European media outlets, Prime Minister Pedro Sánchez called on the European Union to come up with a coordinated response to the crisis. "This is a critical moment in which the most pro-European countries and governments, as is the case of Spain, need proof of real commitment. We need resounding solidarity," he wrote.

Sánchez has been calling for so-called "coronabonds" to be issued in order to share the financial burden of the ongoing pandemic across the 27 countries of the EU bloc. But the plan has so far met with opposition from north European member states such as Germany and the Netherlands.

"If the virus does not understand borders, the financing mechanisms cannot either," the prime minister wrote in his opinion article.

Looks like Italy and Spain will have to pay their own bills.

[T00ts]

Italians are growing rather sick of the EU who are currently fining them 80,000 €uros a day.





At the same time the EU are giving millions to Iran via the IMF to support them in the CV19 crisis.



The Italians are getting tired of being locked down and tired of this treatment by the EU



When they are unlocked I can see a referendum coming on.

The news headlines are so dominated by the virus that a lot of what is currently going on worldwide has been forced into oblivion. I feel that if ever the current crisis goes we will wander out into new world with rather dazed eyes. The EU is interesting. It's being played down but I think there is real friction. Each member state is focused on their own problems yet Brussels is hard wired to more EU, more EU , more EU and making unseemly efforts considering the state of affairs, to assert their authority. I can't help but feel that this time it may well come back to bite them. The only positive I have seen is Italian patients being flown to Germany.