Eurocalypse Now?

May 18th, 2012 at 7:00 am by David Farrar

This should be a superb debate and discussion in Auckland.

Eurocalypse Now?

a discussion with

Daniel Hannan, Member of the European Parliament

and

H E Francis Etienne, French Ambassador to New Zealand

chaired by

Dr Oliver Hartwich, Executive Director, The New Zealand Initiative

Can the Euro crisis get any worse?

With a pro-growth Socialist president firmly installed in France, Greece in political gridlock, soaring unemployment and a deepening banking crisis in Spain, and Angela Merkel’s pro-austerity Christian Democrats suffering a crushing defeat in the big German state of North-Rhine Westphalia, are we finally approaching the end game for the European Union?

Join Dr Oliver Hartwich, executive director of The New Zealand Initiative, for a moderated discussion with firebrand anti- Member of the European Parliament and Youtube sensation Daniel Hannan and French Ambassador to New Zealand and cheerleader His Excellency Francis Etienne.

I so wish I could attend. If you wish to attend, you need to register at this page.

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35 Responses to “Eurocalypse Now?”

  1. philu (13,393 comments) says:

    chrs 4 that..

    phillip ure@whoar.co.nz

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  2. Dave Mann (1,168 comments) says:

    @philu

    Much as it pains me to even comment on something you have written, I have to agree with you, philu :)

    I logged on to thank DPF for the heads-up and saw that you beat me to it and we think alike on this one! :D :D :D

    (FFS what’s the world coming to?)

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  3. All_on_Red (1,335 comments) says:

    When Europe’s finance ministers meet for a group photo, it’s easy to spot the rebel — Anders Borg has a ponytail and earring. What actually marks him out, though, is how he responded to the crash. While most countries in Europe borrowed massively, Borg did not. Since becoming Sweden’s finance minister, his mission has been to pare back government. His ‘stimulus’ was a permanent tax cut. To critics, this was fiscal lunacy — the so-called ‘punk tax cutting’ agenda. Borg, on the other hand, thought lunacy meant repeating the economics of the 1970s and expecting a different result.

    Three years on, it’s pretty clear who was right. ‘Look at Spain, Portugal or the UK, whose governments were arguing for large temporary stimulus,’ he says. ‘Well, we can see that very little of the stimulus went to the economy. But they are stuck with the debt.’ Tax-cutting Sweden, by contrast, had the fastest growth in Europe last year, when it also celebrated the abolition of its deficit. The recovery started just in time for the 2010 Swedish election, in which the Conservatives were re-elected for the first time in history.

    ‘Everybody was told “stimulus, stimulus, stimulus”,’ he says — referring to the EU, IMF and the alphabet soup of agencies urging a global, debt-fuelled spending splurge. Borg, an economist, couldn’t work out how this would help. ‘It was surprising that Europe, given what we experienced in the 1970s and 80s with structural unemployment, believed that short-term Keynesianism could solve the problem.’ Non-economists, he says, ‘might have a tendency to fall for those kinds of messages’.

    He continued to cut taxes and cut welfare-spending to pay for it; he even cut property taxes for the rich to lure entrepreneurs back to Sweden. The last bit was the most unpopular, but for Borg, economic recovery starts with entrepreneurs. If cutting taxes for the rich encouraged risk-taking, then it had to be done. ‘In most cases, the company would not have been created without the owner,’ he says. ‘There would be no Ikea without [Ingvar] Kamprad. We would not have Tetra-Pak without [Ruben] Rausing. They are probably the foremost entrepreneurs we have had in the last few decades, and both moved out of Sweden.’

    But they were not rich, I say, when they were starting out. ‘No, but they were becoming rich. If you have a high wealth tax and an inheritance tax, people emigrate because it becomes too costly to own a company. Ownership is a production factor. Entrepreneurs are a production factor. Yes, these people are rich and you can obviously argue that we want to encourage social cohesion. But it is also problematic if you drive out entrepreneurs from your country, because they are the source of job creation.’

    What even Borg did not expect was that his tax cut for the low-paid would increase economic growth so much that it has almost entirely paid for itself. Borg had created something that Osborne’s critics say does not exist: a self-financing tax cut. ‘There was some criticism at the time that we were borrowing to finance tax cuts,’ he says. But Sweden could do it, because it was expecting to return to surplus soon; Britain has no such luxury, he says. His main advice to Osborne is: ‘Keep on dealing with the deficit, because deficits destroy everything else.’

    Hannah will really embarrass her as the Hollande is totally the opposite to the above. Under Hollande France is truly fucked.

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  4. Falafulu Fisi (2,176 comments) says:

    Can I recommend idiots & economic illiterate as like David Cunliffe, Brian Edwards, Bernard Hickey, Herald finance/economic reporters to attend Daniel Hannan’s debate? I’ve been following Daniel Hannan’s various TV interviews (also on internet & youtube) over the last 2 years or so and no one listened to him. His economic views is closer to the Austrian School of thoughts, so there’s no surprise that Austrian economists have warned about central banking, government interference n the markets & command economy for over 100 years and nobody listen. This is the main cause of financial/economic disaster as Austrian economists have been saying. No one can say for certainty when disaster will strike, but the outcome is pretty much clear that there will be financial/economic tsunami that will arrive with devastating effects.

    There have been many laws after laws being passed over the last 100 years (in half size capitalistic economies) to prevent crises but time and time, it still happening. As congressman Ron Paul has said in recent months. Passing more laws to prevent future financial crisis, won’t stop crises at all, because the problem is Govt interference. That’s the problem. He thinks that the Fed Reserve should be killed and get the Govt out of the free markets and the problem will be diminished slowly over time (but not completely), ie the effects of crises will be minimal.

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  5. philu (13,393 comments) says:

    “..(FFS what’s the world coming to?)..”

    how about the left and the right working together for the common-good…?

    ..(oh..!..hang on..!..that was a dream i had last night..)

    phillip ure@whoar.co.nz

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  6. philu (13,393 comments) says:

    “..because the problem is Govt interference…”

    and there you have it..yr traditional simplistic rightwing (non)-solution…

    ..(it really was a ‘dream’..)

    phillip ure@whoar.co.nz

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  7. graham (2,214 comments) says:

    All_on_Red Says:

    He continued to cut taxes and cut welfare-spending to pay for it; he even cut property taxes for the rich to lure entrepreneurs back to Sweden. The last bit was the most unpopular, but for Borg, economic recovery starts with entrepreneurs. If cutting taxes for the rich encouraged risk-taking, then it had to be done. ‘In most cases, the company would not have been created without the owner,’ he says. ‘There would be no Ikea without [Ingvar] Kamprad. We would not have Tetra-Pak without [Ruben] Rausing. They are probably the foremost entrepreneurs we have had in the last few decades, and both moved out of Sweden.’

    But they were not rich, I say, when they were starting out. ‘No, but they were becoming rich. If you have a high wealth tax and an inheritance tax, people emigrate because it becomes too costly to own a company. Ownership is a production factor. Entrepreneurs are a production factor. Yes, these people are rich and you can obviously argue that we want to encourage social cohesion. But it is also problematic if you drive out entrepreneurs from your country, because they are the source of job creation.’

    What even Borg did not expect was that his tax cut for the low-paid would increase economic growth so much that it has almost entirely paid for itself.

    It seems so obvious, doesn’t it? Hard to understand why so many cannot see it. Slam the entrepreneurs, watch them leave in droves, and wonder why your economy fails.

    France will be extremely interesting viewing over the next three years if Hollande walks his talk – in the same way a good train wreck is interesting viewing.

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  8. tvb (4,193 comments) says:

    Instead of running around like headless chooks they should be planning for an orderly exit for Greece, a managed exit for Spain and Portugal. It simply has not worked to have weaker economies bundled in with others without tight fiscal control and subvention payments.

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  9. Falafulu Fisi (2,176 comments) says:

    traditional simplistic rightwing

    Now, I’m just quoting of what real scholars in economics are saying and that’s simplistic, huh? Scholars say the Keynesian government involvement in the economy fails and you still argue otherwise?

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  10. philu (13,393 comments) says:

    yeah..it really ‘failed’ during that post-war boom in america..eh..?

    ..as just one example..

    ..that ‘boom’ that created the american middle class..and lifted all boats..

    ..and what the right has now successfully wrecked..

    ..as they work not for the common good..but for the ‘good’ of a few..

    phillip ure@whoar.co.nz

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  11. graham (2,214 comments) says:

    Falafulu Fisi: Ignore him. Not worth it.

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  12. philu (13,393 comments) says:

    no answer/counter to that one..eh fisi..?

    phillip ure@whoar.co.nz

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  13. Ross12 (1,143 comments) says:

    Falafulu Fisi –given your thinking you’ll really enjoy this speech given by Robert Wenzel to the New York Fed Reserve

    http://www.economicpolicyjournal.com/2012/04/my-speech-delivered-at-new-york-federal.html

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  14. Joseph Carpenter (210 comments) says:

    I’ll take one for the team.
    Mr Philu you clueless dolt, in the USA federal spending as a percentage of GDP peaked at 54% in 1945 (the end of WW2), by 1949 it had plummeted back down to 22%, it remained under 30% from 1946 to 1971 (the post war boom years), post 1971 (oil shock – Keynesian response – stagflation and Keynesian failure) it steadily started to rise from 31% peaking in 2011 at 47% and still escalating (projected to hit 49.5% for FY2012). So much for Government stimulus.

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  15. unaha-closp (1,111 comments) says:

    With a pro-growth Socialist president firmly installed in France,

    With a pro-stagflation Socialist president firmly installed in France, – fixed that.

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  16. philu (13,393 comments) says:

    (astonishing how so many economic-believers have such a narrow/limited view/perspective…)

    “..So much for Government stimulus…”

    sigh..!..ok..a more recent example:

    it is generally accepted obama saved the american auto industry…using ‘government stimulus’..

    ..whereas those such as yrslf no doubt argued back then how obama was ‘just throwing good money after bad’..

    ..and that ‘they should be allowed to fail’..

    ..eh..?

    (you can really add ‘simplistic’ to that ‘narrow’-view…eh..?)

    phillip ure@whoar.co.nz

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  17. tom hunter (4,367 comments) says:

    Judging from the comments out of Greece yesterday, the leader of the Syriza party has decided to engage in some brinksmanship with the rest of the Euro. He was arguing that they could not afford the collateral damage of Greece leaving the Euro.

    In short, he’s telling Europe that continuing to shovel cheap loans to Greece – even with no fundamental changes made to Greek systems and the subsequent write off of those loans in the future – will be less than the damage caused now with a Greek exit. It’s an interesting threat because it goes to the heart of the calculations the rest of Europe is undoubtedly making, but I don’t think the leader of Syriza has actually made them; he’s just rolling the dice.

    The Greek people themselves seem utterly schizophrenic on the matter, with something like 70% not wanting to leave the Euro, while a majority don’t want to abide by the terms of the deal that got them the Euro loans. The typical, final stage of dependency: the demand for endless free stuff and no consequences.

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  18. unaha-closp (1,111 comments) says:

    ..whereas those such as yrslf no doubt argued back then how obama was ‘just throwing good money after bad’..

    ..and that ‘they should be allowed to fail’..

    Hey Phil, while you are claiming the “success” of socialism bailing out things that are too big to fail

    don’t forget the banks

    and the insurance companies

    and the auto-executives

    and the pension fund mangers

    and every other mega rich recipient of government largesse…

    Thats all your socialism amounts to isn’t it?

    Making sure the mega rich get paid off, from tax payers money.

    how about next time a big tiome loser lets a few $billion go down the toilet we let them fail

    stop being socialist and boasting about how it saved the fat cats.

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  19. philu (13,393 comments) says:

    unaha..you have got that so wrong from so many angles..presumption piled on assumption..eh..?

    i don’t really have the energy/will to bother..eh..?

    ..you just carry-on..eh..?

    ..but be assured you have got everything wrong about my attitudes..

    ..and we’ll leave it at that…eh..?

    phillip ure@whoar.co.nz

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  20. Seán (396 comments) says:

    What’s important to the man on the street? Common currency and free movement of labour.
    What’s important to the business owner? Common currency and free movement of labour.
    These things must be maintained, and the root causes to the problems fixed, not dismantled.
    Politics can just piss off.

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  21. unaha-closp (1,111 comments) says:

    phil,

    You’re a borrow more money, middle road socialist

    as long as the bankers get paid

    as long as the auto companies get bailed out

    as long as no one ever “fails”

    you’re happy.

    Because as long as on one fails the world is so marvellous it smells like freshly baked bread – right?

    No – wrong.

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  22. tom hunter (4,367 comments) says:

    I just knew the Greek thread and this one, was going to pull a few unreconstructed leftists out to demonstrate that even utter bankruptcy cannot force them to change their policies. Here’s a classic example from the Greek thread:

    I think this is a wee bit alarmist. Clearly there are right ways and wrong ways to go about implementing government spending and left wing policies and obviously Greece is a great example of doing it the wrong way. And why can’t we raise taxes to get out of deficit, btw?

    Clearly the private sector still has not been prepared to step up since National took office, in spite of their supposed business friendly policy, and subsequently unemployment has increased. Growth has been pathetic, in spite of the utter crap that is the “growth in 10 of the last 11 quarters” line that Key, Joyce, English et al have been trotting out ad nauseum.

    Seems like a prime opportunity to wop on a capital gains tax and get some proper infrastructure spending going. Maybe that Keynes guy had a point hmm?

    Amazing is it not?

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  23. philu (13,393 comments) says:

    there you go again..una..

    ..have you always piled presumption upon assumption…?

    ..phillip ure@whoar.co.nz

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  24. unaha-closp (1,111 comments) says:

    how about the left and the right working together for the common-good…?

    ..(oh..!..hang on..!..that was a dream i had last night..)

    FFS – me too same dream/nightmare

    Dreamed some big as banker/autocompany/insurance firm went bust through shear and obvious stupidity – happy dreams.

    But then nightmare – the socialistconservative rightleft governments gave them $trillions and bailed them out

    But then more nightmare – some other bank/insurance/company went bust through utter and total incompetence and the leftright bailed them out too

    But then more nightmare – some other firms/companies/countries started going bust and the socailistconservatives bailed them out too

    And then the rightleftists leftrightistsor whatever you call yourselves started telling us that all we really need to do is print lots of money from nothing so that it can be given straight to the mega rich so that they never need to be bailled out again.

    Then I wake up and don’t know what will happen next.

    What will happen next phil, should we keep doing the conservativesocialist thing – printing more and more money?

    Or

    should we stop and

    LET

    THEM

    FAIL

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  25. krazykiwi (9,189 comments) says:

    All_on_red 8:30. Excellent comment. I’ve been along time promoter of policy to bring wealth creators to NZ. The deadly embrace of socialism and Keynesism is creating a pool of mobile, wealthy and talented individuals fleeing economic persecution. These are the immigrants we should welcome to NZ.

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  26. Rick Rowling (801 comments) says:

    Mental note, next time I’m pulling a group of countries together to form a common currency: Don’t invite the country where it costs 5000 units-of-currency for an icecream. They may have had money troubles before.

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  27. tom hunter (4,367 comments) says:

    All_on_red ++++ from me too. I’d been aware for some time of Sweden going on a different path from it’s reputation, but I’d not seen that commentary.

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  28. philu (13,393 comments) says:

    “..What will happen next phil,..”

    ..i don’t think anyone has a good grasp on that one..

    phillip ure@whoar.co.nz

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  29. krazykiwi (9,189 comments) says:

    tom, the commentary is valuable… but the country, as MasterCard would say, is priceless. The very mention of Sweden used to have socialist fraternity dewy eyed and weak kneed in admiration, although I have noticed that quieting down as the Swedes have moved wisely and carefully to the economic right

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  30. krazykiwi (9,189 comments) says:

    phil, there’s only one thing you have a good grasp on, which I imagine is quite an achievement :)

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  31. joe90 (273 comments) says:

    All_on_red 8:30. Excellent comment.

    Pity he’s stolen it.

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  32. krazykiwi (9,189 comments) says:

    joe90, stolen? It always looked like a cut’n’paste to me. I’m glad it was copied here.

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  33. joe90 (273 comments) says:

    Not attributed to the original author and posting almost the entire article as his own commentary is plagiarism.

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  34. tom hunter (4,367 comments) says:

    plagiarism.

    Yawn! Given the number of commentators who don’t know how to do hashtags it’s hardly a surprise, and I certainly knew it was not the writing style of a commentator.

    But thanks for the original link Joe. Kiwiblog may give All_on_Red a wedgie about that when he returns.

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  35. wikiriwhis business (3,883 comments) says:

    Can’t believe the term ‘end game’ was used in the MSM.

    They don’t like letting the horse bolt as Jenny Shipley said.

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