Just a little more austerity, please

There’s a wonderful Monty Python sketch where a waiter asks a fat man, ‘just a wafer thin mint, sir?’. On taking this wafer thin mint, the fat man (Mr Creosote) explodes. It feels a little like that with European austerity (except in reverse). Countries in the periphery implement austerity, and the economic situation deteriorates. This deterioration leads to calls for more austerity or even deeper austerity, but the crisis deepens, and the debt crisis shows no sign of ending. Despite the failure of austerity, the only solution offered is just a little more austerity – surely the next round of budget cuts will solve the problem. But, there is a danger that like the fat man, in the sketch some future round of austerity is going to cause the patient to explode (or implode)

If it wasn’t for the cost to individual lives from mass unemployment, you could probably see some dark humour in the Euro tragedy.

Recently, Merkel called on her European partners to stick to their deficit reduction plans.

“We need to take a deep breath to overcome this crisis. We must make the efforts that will allow Europe to emerge from the crisis stronger than it went in.” (Angela Merkel, Europe must stay the course)

It is unfortunate that what might be a private virtue becomes a public vice. I don’t doubt she means well. But, there has been a failure of understanding to appreciate the nature of the problem. I’m not sure whether it’s arrogance, incompetence or wilful misunderstanding. But, if the key players in Europe don’t understand the nature of the Euro crisis, what hope do we have for solving it.

 

 

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