Skip to comments.France cuts frantically as Italy nears debt spiral
Posted on 11/07/2011 3:31:05 PM PST by bruinbirdman
France has unveiled the toughest austerity measures since World War Two despite the looming danger of a double-dip recession, vowing to slash borrowing by 65bn over the next five years in a last-ditch effort to save the country's AAA rating.
French Prime Minister Francois Fillon
"We wish to protect the French against the grave problems facing other European countries. Bankruptcy is not an abstract word," said premier Francois Fillon.
The belt-tightening plan -- the second package since August, taking total cuts to 112bn -- include a 5pc super-tax on big firms, a rise in VAT on restaurants and construction, and cuts on pensions, schools, health, and welfare. It is the latest squeeze in a relentless campaign of fiscal tightening across the eurozone.
"It is like the 1930s: imposing austerity on countries already in recession is the way into a death spiral," said Danny Blanchflower, a former UK rate-setter.
Left-wing critics have evoked grim parallels with the "deflation decrees" of Pierre Laval in 1935 when France had to take ever harsher measures to preserve the country's viability on the Gold Standard, a gamble that ultimately set off violent street protests.
France's move came amid a further blizzard of grim data from Europe, confirming that most of the region is already on the cusp of recession. Growth has reached a "virtual standstill", said EU commissioner Olli Rehn.
Eurozone retail sales fell 0.7pc in September from the month before. German industrial output plunged 2.7pc, the steepest drop since the depths of the crisis in January 2009. Factory orders fell 12pc.
Mr Fillon said the country must accept sacrifice to "avoid the day where policies are imposed upon us by others," insisting that France would meet its "untouchable" deficit target of 4.5pc of GDP next year -- down
(Excerpt) Read more at telegraph.co.uk ...
All the time welcoming more and more and more muslins to invade their nation. They are as stupid as we are on allowing low lifes into the nation.
One of the ways The Obammunist can claim there is no recession (two quarters of falling GDP) is by increasing government spending more than other factors of GDP decrease.
Right now, Hussein has increased spending 13% more of GDP than the 2008 budget. Take that away and what does the 2.5% growth look like?
In addition to the low-life corporations here who refuse to train any american, instead demanding more H1 Visas for those from muslim/communist countries like China, Pakistan, India and Mexico so they can pay them pennies. The stench of corruption goes all the way up the ladder.
One of the things people forget about Keyes is that he wrote when most major economies were on a gold standard and not in the fiat, central bank managed currencies.
“Right now, Hussein has increased spending 13% more of GDP than the 2008 budget. Take that away and what does the 2.5% growth look like?
Actually it kinda looks like this:
Perverse, n’est ce pas?
“In addition to the low-life corporations here who refuse to train any american, instead demanding more H1 Visas for those from muslim/communist countries like China, Pakistan, India and Mexico so they can pay them pennies. The stench of corruption goes all the way up the ladder.”
You can’t “train” someone to be an electrical or mechanical engineer. Takes a college degree. Indians and Chinese are willing to put in the hard work to become real engineers. Many American kids prefer college majors like “____-American Studies” or “Medieval French Literature” (dont’ laugh - got a cousin who did that). And they’re shocked that they are unemployable.
A company that needs an electical engineer will often have to get a foreigner on an H-1B visa. Either that or outsource the job to India or China. Take your pick.
It’s the difference between sopping up excess inventory and devaluation. I don’t think Keynes ever advocated the latter. I think even Keynes would find the debt levels we’ve obtained with cheap credit offensive and counterproductive.
Liberal Arts = good for government work, unless you're willing to start at the bottom and prove you can climb the ladder.
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