The Crisis Abroad
I’m really enjoying the cover of Bloomberg Businessweek today. It seems like most people are too fixated on the economic crisis at home to give more than a few glances at the headlines pointing to the economic crises happening abroad. But since we’re all part of the global economy, and since what’s happening abroad is pretty much a funhouse mirror of what’s happening in the U.S., it’s important to get a good basic understanding of it. Adam Davidson summed it up pretty nicely last November:
Europe’s problems are a lot like ours, only worse. Like Wall Street, Germany is where the money is. Italy, like California, has let bad governance squander great natural resources. Greece is like a much older version of Mississippi — forever poor and living a bit too much off its richer neighbors. Slovenia, Slovakia and Estonia are like the heartland states that learned the hard way how entwined so-called Main Street is with Wall Street. Now remember that these countries share neither a government nor a language. Nor a realistic bailout plan, either.
Davidson’s primer is excellent, and for updates, I’d highly recommend the stories in this week’s Bloomberg Businessweek.
there’s a billfold analogy to be made here too I think
@redheaded&crazy Here’s a Billfold analogy for the growth vs. austerity debate: Let’s say you’re working a crappy job and have been using credit cards to make ends meet, and now you’ve built up a sizable mound of debt. You could cut back drastically and spend all your extra money to pay down the debt, but you’ve also been offered a higher-paying job in another city that would require a pricey cross-country move.
The question, then: is the government a Mike who can put the move on its credit cards and then use his higher salary to pay down debt, or a Logan who needs her credit cards locked away forever?
I’d go for a much simpler analogy: the European governance structures are like the US Congress, with Germany playing the part of the Republicans.
Or, as Homer Simpson famously said of beer, Germany is the cause of and solution to all of Europe’s current problems.
@stuffisthings Actually, I take that back. It’s dumb to try to conceive of Europe’s problems on American terms, because they are totally different. For one thing, the global economic crisis has made the problems worse, but it wasn’t the cause of them. And the root issue that’s preventing things from being speedily resolved (i.e. how to deal with economic problems when you are chained into a common currency) has no American analog at all.
The Germans are still dicks, though.