http://www.telegraph.co.uk/news/wor...rk-Rutte-resigns-over-austerity-measures.html Everyone's been busy noticing the power of the protesters in the Arab Spring, but I also think it's time to start recognizing the bondholders of the Austere Winter. With the latest resignation, the number of governments that have collapsed in the Austere Winter has reached four (Romania, Italy, Greece, and now the Netherlands), which now equals the number that have collapsed in the Arab Spring (Yemen, Libya, Egypt, Tunisia). Who will be next? Where do we go from here? The Netherlands was one of the strongest voices for European austerity. To see their government collapse because of it is just the height of irony. Growth vs inflation, revolution vs devolution...what can be done? America would do well to keep an eye on developments, as never-mind the direct effect, anything that happens over there, can happen over here. Push too hard for austerity, violate the set rules of economics, and you can see what will happen. For some, this is a happy thought. For others, a sobering reminder that the medicine can kill the patient.
The Euro was bound to fail the moment it began 1. A score of countries with vastly different economies 2. Voluntarily giving up monetary soverignty 3. Tethering themselves to single currency over which they have zero control 4. Still pursuing independent fiscal policies without the safety net of a fiscal union Fiscal austerity/restraint is the only way the member states' governments can get their balance sheets in order. Unfortunately, that requires draining the private sector of its hard-earned financial assets, increasing the pain of an already painful demand-shock recession.
I don't think what happened in the Middle East could be equated with reasonably democratic shifts in power elsewhere.
There is nothing democratic about governments falling according to the whims of sometimes irrational bondholders. The reference was more symbolic than anything, but I would argue what is happening to Europe is even more sinister when one considers that this is a very real possibility for America and other developed countries.
Dont get too far on the Dutch. The odd thing about the Eurozone crisis is that both far left and far right parties oppose austerity. In the case of the left, they oppose cuts to social services and on the right they oppose EU mandates. Needless to say, countries with multi-party coalitions that have any sort of far left or far right party are vulnerable. All this goes to show is the vulnerability of coalition governments and parliamentary systems in times of crises. You could argue that the 2010 election in the US was much of the same. Literally two years after sweeping into power the democrats lose control based on discontent with the economy. I dont know why you think its shocking that the same thing happening in Europe (which is far worse off than us). And they have parliamentary systems to boot so these types of collapses happen even faster. That's not to say this is a good thing. Conservatives would disagree but I'd say we're seeing the consequences of rash anger. Europe will see it as well. But to suggest any real or symbolic connection doesnt seem right to me.
While I was looking further into this Dutch crisis, I stumbled across some amazing images taken from the International Space Station by a Dutch astronaut currently up there. Here's an example: Great Britain, Ireland, and part of the European coast. Those are some Northern Lights in the upper left. Paris by night. Here's the link. Carry on! http://www.telegraph.co.uk/technolo...ures-to-Earth-via-Twitter.html#?frame=2192573
I'm suggesting it's a symbolic tie, but it could be a very real one soon. There have already been multiple suicides because of austerity--- http://www.telegraph.co.uk/news/wor...Greek-pensioner-shoots-himself-in-Athens.html ---and let us not forget the riots in London, Madrid, Rome, and Athens that have already been started. Sure, there are different systems in place, and obviously Europe's issues don't hover around democratic reform, and human rights abuses on a massive scale. But the consequences could be just as dire sooner than most people realize.
That's the bigger loss. If he goes down, Germany is on its own. Germany wont be able to muscle through its agenda in the EU anymore without Sarkozy.
The Netherlands was also the other strong voice for austerity both in ECOFIN, and the ECB governing council, them losing a peg pretty much means Germany is the only one left standing on that side.
