Tuesday, May 11, 2010

FLG, As Per Usual, Bringing You Today's News Yesterday

Roger Cohen writes:
the euro was supposed to be a political tool


As Ivan Krastev, a visiting fellow at the Institute for Human Sciences in Vienna, put it to me, “Without solidarity, how do you convince Poles that Germans are prepared to die for them?”

Anne Applebaum has an interesting article on the same topic of politics and the monetary integration.

FLG wishes the rest of the news organizations would realize that while this issue does have important economic consequences and aspects, the real story is political. Then again, this is about long-term, macro-level, European politics, so maybe the American news isn't particularly fit to cover it. It's not something that can be covered like a sporting event with cool holographic images displaying wildass guess about electoral outcomes.


Anonymous said...

La! Ok let's have some real fun - from these two snippets, write tomorrow's news and Frank Rich's next female complaint:

May 11 (Bloomberg) -- Germany and France are among top- rated euro-area states that may compromise their AAA grades by standing behind the debts of weaker members with their 750 billion-euro ($955 billion) stabilization fund.

"The package is “making debt profiles deteriorate, potentially damaging the ratings of core sovereigns,” said Stefan Kolek, a strategist at UniCredit SpA in Munich. “It’s a kind of Ponzi game at the highest level.”

"The unprecedented loan package was designed by the European Union and the International Monetary Fund to halt a sovereign- debt crisis that threatened to push Greece, Portugal and Spain into default and shatter confidence in the euro. As part of the support plan, Germany’s Bundesbank, the Bank of France and the Bank of Italy started buying government bonds yesterday."


Anonymous said...

From The NYTimes 5/10:

"PARIS — President Obama had just flown into Hampton, Va., Sunday morning to deliver a commencement address. But before he donned his silky academic robes, he was on the phone with Chancellor Angela Merkel of Germany, offering urgent advice — and some not so subtle prodding — that Europe needed to try something big.[..big snip...]

“He [Obama] was trying to convey that he knew these were politically difficult steps that the leaders there had to take, that he had gone through them as well,” said one senior administration official familiar with the conversation. “And that, from his experience, trying to get out ahead as much as possible was the right way to go.”

That call was part of what a senior Treasury Department official called “one long conversation” with European leaders, who over an extraordinary weekend of late nights and early mornings overcame German resistance and agreed to a wholesale expansion of the bloc’s political and financial mission. Bending the rules, they backed the stability of all 16 countries that use the euro with loan guarantees adding up to nearly $1 trillion.

In the process, the European Union, under crisis conditions, moved fitfully toward more centralization, toward a French vision of an economic government for the region. It is a role not totally unlike the one that the federal government in the United States played during the early stages of the financial crisis in 2008.

"But to get there involved intense bargaining among leaders, especially the French president, Nicolas Sarkozy, and Mrs. Merkel but also the Italian prime minister, Silvio Berlusconi; Group of 7 finance ministers; the Japanese; and the Americans, according to interviews with numerous participants in the talks in Europe and the United States.[...big snip]

"The United States officials began talking to their counterparts about an American concept: overwhelming force. “It’s all about psychology,” said the senior official. “You have to convince people that the government will get its act together.”

"But it was not until Sunday, one official noted, that the meltdown spreading across Europe was regarded as “an existential threat.”

Mrs. P

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