Danish kroner is pegged to the euro, though.
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WaPo: The euro is a disaster even for the countries that do everything right
- Thread starter Chittagong
- Start date
Evolution of Metal
Member
Except this article is the opposite: Nethelands/Finland has applied less austerity, the process of currency devaluation is a form of austerity.
Plenty of countries are in the EU and not the Euro, so I don't see why they couldn't leave the Euro and stay in the EU.
Charles Brandon
Member
That's not the point.
So what is your point?
Yeah, sure, but one thing is a 30~40% difference. Another thing is having some countries like Poland and Portugal where the minimal wage is 100~150% less than Germany or France.
eot
Banned
You realize that's mathematically impossible, right? You can't be 150% less than anything, as you'd be negative.
RoadHazard
Gold Member
I don't believe you can leave the Euro. Technically, all countries in the EU are obligated to join the Euro eventually, some are just using loopholes (by purposefully not fulfilling certain requirements) to avoid it indefinitely.
Charles Brandon
Member
The point is the UK was a bulwark preventing the Eurozone from integrating more comprehensively. They may not choose do so but one of the obstacles to that is now gone, or will be soon.
They are looking at where the three economies are compared to 2008 crisis, ie who has recovered best
I like Euro for the convenience, having the same notes when being in Helsinki and Catania, but not sure if the convenience worth the cost for individual economies. I mean, Sweden and Denmark seem to do just fine with their Krona.
Nokia crashing and sanctioning Russia obviously have nothing to do with it, it's all the fault of the euro.
andythinkpad
Member
Greece should have quit Euro a few bailouts ago, and Euro should have splitted into a soft and hard dual currency system a long time ago.
There are many books that talk abiut thos.
There are many books that talk abiut thos.
I have strong reservations about taking any sort of general advice from the happenings of a country with 300k souls and substantial natural resources.
I'm pretty sure it'd be pretty easy to handpick a region out of the netherlands or wherever with 300k inhabitants and about the same performance as iceland.
I'm pretty sure it'd be pretty easy to handpick a region out of the netherlands or wherever with 300k inhabitants and about the same performance as iceland.
darkinstinct
...lacks reading comprehension.
The Nokia effect.
Napalm_Frank
Member
Finland is far from ''doing everything right'' when it comes to being competitive in the euro.
Euro does suck but here we are. We know what we need to do in order to stay competitive but it usually ends up being a political quagmire to actually push it, nobody wants to work for less after all.
But there are a bunch of other issues with the currency other than economic performance. As seen with Greece it's also a political anchor that drags everyone into dealing with shit that wouldn't otherwise have nothing to do with them, mostly for political reasons.
Euro does suck but here we are. We know what we need to do in order to stay competitive but it usually ends up being a political quagmire to actually push it, nobody wants to work for less after all.
But there are a bunch of other issues with the currency other than economic performance. As seen with Greece it's also a political anchor that drags everyone into dealing with shit that wouldn't otherwise have nothing to do with them, mostly for political reasons.
pardon me, I meant that the minimal wage is 100~150% higher in those countries compared to the others.
spons
Gold Member
They are looking at where the three economies are compared to 2008 crisis, ie who has recovered best
I like Euro for the convenience, having the same notes when being in Helsinki and Catania, but not sure if the convenience worth the cost for individual economies. I mean, Sweden and Denmark seem to do just fine with their Krona.
Can someone explain this graph and how it somehow supports the notion of the euro being bad? It seems that euro-country Netherlands is by far the best of the three, showing long-term growth and stability. I really don't understand this.
"Who has recovered best" seems like nonsense when the Netherlands seems to have barely lost anything according to this graph.
I am afraid nothing can cure those democracies. There's no political will to do long term projects and restructure for the new economic model that will have to come. That's also why we seems to be able to mobilize only after civil right issues lately from the left, but hardly anyone actually speak about hard economic issues and necessary restructuring.
Theonik
Member
Wages in Greece are down to 200-400 Euro these days lol
The article was published on July 17, 2015. Not sure why somebody decided to cram it out and post it on GAF today.
QuicheFontaine
Member
Washington Post is Anglo Saxon?
Jerry
Member
Theonik
Member
There is no provisions for leaving the Euro in the treaties but that's a soft problem. Brexit is still happening despite no formal procedure for what happens after notice of the intention to leave.
Re-introducing a national currency would be very painful as you can't just do it and the moment you announce it everything would go to shit. It's why the Greek FinMin made plans for that contingency in complete secrecy.
Not true per-se. Denmark and the UK are the only ones that have the single currency opt-out from the Maestricht treaty, but there is room in the 'when ready' provisions. Sweden purposely didn't sign one of the requirements. For new members though they have to sign up to the full pack and accept a schedule for joining the Euro. It's really bad for them because trade with the EU is vital to their survival and its growth makes it impossible not to be in the EU and grow their economies so they need to join whether they like it or not.
The expansion of the EU and the Euro currency was done largely for Geopolitical purposes. By slowly integrating as many states as possible you create a very effective buffer zone against Russian expansion. It's also a great supply of inexpensive labour.
Evolution of Metal
Member
Either you live in some kind of the outlier region, or literally, every source on Greece's economy in 2016 or 2017 is lying.
QuicheFontaine
Member
Huh, I've never heard it used that way. But I guess that makes sense since I am from an Anglophone country.
sechsterangriff
Member
Artificially devaluating currency is usually nothing more than a way to hide systemic problems in a country's economy in order to stay competitive in exports. When countries joined the Euro, governments knew they we were abdicating from such an instrument.
The Eurozone may be struggling now, but hopefully as countries are actually forced to tackle these problems and implement reforms we may actually end up with much more solid and sustainable economies in the future.
The Eurozone may be struggling now, but hopefully as countries are actually forced to tackle these problems and implement reforms we may actually end up with much more solid and sustainable economies in the future.
You can really tell how hard they tried with this one by the countries they looked at. The Netherlands has the population of 50 Icelands. Iceland is in a very unique position anyway and Finland had its own problems from Nokia to Russia that, unless you atleast heavily mention them, makes your conclusions useless.
One of the reasons I hate this currency devaluation discussion. I feel like it's mostly a tool so politicians in certain countries can always promise more spending while at the same time destroying savings and increasing the burden on future generations.
Your real problem will be that all of your debt (and any country willing to do this would probably have a lot of it) will remain in EUR, USD etc while your new currency probably tanks. If it devalues by 50% then you just doubled your debt and it will hurt you for decades to come.
One of the reasons I hate this currency devaluation discussion. I feel like it's mostly a tool so politicians in certain countries can always promise more spending while at the same time destroying savings and increasing the burden on future generations.
Way more than that actually, but minimum wage is an awful way of looking at economies. Germany didn't even have one until recently.
I would not be surprised.
Southern Italy's wages are in the 600-1000 range, and they're mostly non-standard contracts, aka people being paid without contracts or with non-congruent smaller contracts compared to the actual jobs. Those people don't results on actual statistics for worker wages, while for example, state workers do (and those are on the usual 1200-1400 € minimal official wage). They probably appear as unemployed or employed only for brief periods each year, while the reality is different.
Farm workers make about 200€ a month there as well while working up to 60 hours a week and oftentimes have to prostitute themselves if they're women. The situation is supremely shitty, and i have no doubt it may very well be worse in greece. I have a lot of interesting articles about how actually bad the situation there but they're all in italian.
With the irony of it being that everyone(including Germany) agreed that the D-Mark became too strong and the Euro was an idea to "weaken" Germany. Whelp.
ClosingADoor
Member
True, and I don't mind it that much. But with a lot of Southern Europe being unemployed, is getting cheap labor from Romania and Bulgaria really the best choice. It is obviously great for those countries, but this expansion also creates more anti-EU sentiment and additional problems in the short term.
Theonik
Member
That wasn't really the case when that decision was made, and that decision can't exactly be unmade. People should have probably protested more as it was a deliberate decision to undermine their worker's rights, but on the flipside they still benefit from the economic growth these immigrants brought in. It's not so simple as 'Why are we paying these countries for!'
Central currencies like the Euro help increase trade imbalances in countries with less efficient production sectors. That's because in normal currency exchanges, trade imbalances are punished by making imports more expensive, when your currency is pegged to a much stronger economy, that means you import as if your overall trade deficit was the total external trade deficit of the EU as a whole, but in practice without a fiscal union you don't get the revenues that would come with that kind of trade!
Ignoring the current economic situation(in which the EU outperforms the US) OP is trying to create a narrative or what?
Charles Brandon
Member
Is it possible to have fiscal union without political union?
Ha. I wondered why they use data only up to 2014, but it didn't occurred to me to check the data on the article. I trusted the OP too much.
Chittagong
Gold Member
Came across my social media today, not sure why it's trending again. I really need to start checking dates of what I read.
That is not to say it's not topical, Euro certainly an interesting discussion, the world looks quite different today than it did in 2015.
Added a disclaimer top of post
Didn't the US start like that?
Germany is not the wonderland everybody thinks it is. We are currently transforming into a cheap labor country as the wages haven't raised like they should have in the last few years.
eg: Many people, especially in the automotive sector, are only temporary employed, by a sub-company. There's a law that states that the temporary employed people have to become a full employer after some time, but the companies just cancel their jobs right before this time period is up, hire new people and re-hire the fired people back after a few months - so the cycle begins anew.
eg: Many people, especially in the automotive sector, are only temporary employed, by a sub-company. There's a law that states that the temporary employed people have to become a full employer after some time, but the companies just cancel their jobs right before this time period is up, hire new people and re-hire the fired people back after a few months - so the cycle begins anew.
Theonik
Member
The US started as independent colonies with their own governments, that were paying taxes to the crown until the crown got too busy being in war to bother collecting said taxes. When the crown tried to start collecting taxes again the states revolted, but having a fiscal union was very difficult to sell to the states when the whole point of the war was to avoid paying their taxes to the United Kingdom! Eventually this model was deemed unworkable and the constitution was written to replace that which included an effective political union, as well as gave congress the power to raise taxes.
Arguably, they all come in a pack. Once you have monetary union the other two must follow. Even Thatcher warned about this. Though she was still full of shit since she was one of the people that pushed for the single market and for the Euro to be created as a means to control a unified Germany.
Frankfurter
Member
? The key is real wages actually have risen, which is in stark contrast to, say, 10 or 15 years ago. Plus now we have a minimum wage.
That thing about re-hiring people is bollocks btw. Temporary employed people can't be rehired indefinitely. It's two years (unless there is a specific reason for the job to be temporary) for the same employer/employee. I.e. an employer mustn't just rehire the same employee over and over again with temporary contracts.
The irony is that Germany is not propping up Greece, they are actually holding them back. Then Euro acts as a sort of de facto gold standard for the smaller weaker economies and is a major factor why Greece can't fix its shit.
Peter Ian Staker
Member
You think the employers that pays 200-400 a month registers his employs and pays their insurance?
Greece has too big of a black economy for official sources to make sense.
The Hamburglar
Banned
No shit. Just another stupid idea not thought out properly. Sums up most of the eu.
Frankfurter
Member
So what? This does not dispute anything that I've said. Yes, Leiharbeit is an issue. But it has nothing to do with what you just said (companies hiring, firing and rehiring on temporary contracts).
Edit: As a Leiharbeiter, you are employed at the respective Leiharbeitsfirma, not, say, Daimler. So of course those rules (24 months of temporary contracts as a maximum) apply to the company that you are an employee of, not the one that it has "rented" you to.
Don't get me wrong, the whole concept is a little bollocks, to say the least.
This is patently false! 40% of the EU's budget goes on agriculture, down from previous years and continuing to fall.
Why do Americans (I'm talking about the WaPo in this particular instance) feel the need to pontificate on OUR affairs and lecture to us what is best for us. Krugman at the NYT has been proclaiming the imminent death of the Euro for years and still.....nothing. It does seem as though the US is unnerved by a successful and prosperous Europe stealing its crown as world's number one economy.
Far from being a failure the Eurozone is growing at a healthy rate. American economic nationalists who work to break up a union I'm exceptionally proud of can fuck right off!
Hasphat'sAnts
Member
But fiat money is bad tho.
That's what internet libertarians who hate the fed tell me
That's what internet libertarians who hate the fed tell me
