Βι¶ΉΤΌΕΔ

Sensible Economist? Now there's an oxymoron if ever I heard one.

Basket case or not, "Europe" and the "Euros" who live there is the official whipping boy for right-wing Americans when looking to blame the failure of their wars on someone else.

A whole coterie of experts, including the Βι¶ΉΤΌΕΔ, and luminaries like Nick-I-Was-A-Leftie-Once-Cohen and the team of yes-men who surround him, tell us that we Europeans may not notice this barrage of hatred from the USA, acknowledge its existence, nor (especially) retort.

So they can bash us all they like - but we have to pretend it's not happened, and it's not been Americans who did it?

I hope you're all on-message about that now. After all, the Βι¶ΉΤΌΕΔ's mission is to become a "world broadcaster", and as we all know, the only important bit of the world is the bit south of Canada and north of Mexico.

Now America vs. Europe is something worth a blog entry if nothing else is... but of course, there's much more to it than meets the eye.

Looking at the statistics it can often appear than Europe is in a much worse state than America - particularly in things like growth. But there's forces at work here, which seldom get much attention. One imporant one is the increase in the US population through immigration - legal and not. That means that while the US economy grows, much of that is down to all the extra people (and mouths to feed). How much each individual makes grows much less.

A second part of the story is the slow drop in hours of work by europeans. Basically, we're cashing out quite a lot of our gains in productivity as extra holiday rather than as making more stuff.

If you take those two stats into account then Europe and America aren't doing too differently - so more to it than just the headlines!

I live in Madrid , where itΒ΄s been boom town for at least the 5 years IΒ΄ve been living here . Strikes me the "Euro Area" doesnΒ΄t exist , many of the individual parts are running at different speeds . DonΒ΄t know if thatΒ΄s a good or bad thing in principle !

I remember my parents generation complaining about the inflationary effects of decimalisation years afterwards. The fact was the UK economy and the world economy was in a bad way. I feel there is a certain price inertial that is suddenly lost when currencies are changed and there is a short term inflationary effect, but its the state of the economy that drives it from there on.

Europe is on death's door. It's economy is based on a host of contradictions and falacies which will ultimately bring it to ruin. Its expensive social safety nets and bureaucracies are unsustainable but in places like France, abandoning them would spell political ruin. It cannot compete with the developing world especially China, India, and Brazil, the US, Japan, South Korea, or Taiwan as a producer of manufactured goods and technical services. If it tries protectionist tarrifs, it will not only violate WTO rules, it will provoke retalliation of what it has to sell. If it doesn't, its domestic producers will be driven broke by a flood of cheap imports. It has a demographic time bomb ticking, an ethnic time bomb ticking, an energy crisis time bomb ticking, a global warming time bomb ticking, and the prospect of massive social upheavals and wars directly to its south and southeast in Africa and the Middle East. It has so alienated the United States, it is on the verge of an open trade war with it, a war it cannot afford and cannot win. Frankly, I think at this point the US is so fed up with Europe, it is spoiling for a fight. Europe recovering? The bright light at the end of the tunnel is the headlight of an oncoming train.

Good luck with the blog. I look forward to following it.

But may I take issue with your headline for this post.

I wonder if you realise where "basket case" derives its meaning and power? Its force comes from the image of a double amputee, written off, as it were, as hopeless.

It is distractingly, even distressingly, graphic. And as a metaphor only has meaning insofar as we assent to the underlying notion that the life of a quadraplegic is damaged beyond hope.

I'm not sure you wanted to convey any of that. I recognise that the term has been much used among economists. Perhaps it is time to stop.

PJ

i would like to add my simple opinion
to this blog. i had a house which when i purchased it went from 27k to 140k in a matter of 5 years . when i purchased this house i thought it was a fare price
wages an everything in proportion. now i have friends buying small semis for 140k
with payments of 1k a month going out there accounts with credit cards and loans coming out of there ears ! not just one person but a vast number of them. the point being house prices have risen far out of normal peoples reach and the banks are still borrowing large amounts that people have to work lager and harder to pay for ! i my self sold and moved to thailand out of the 'rat race' over here people can work save there money and have there house payed for in 5 years . there is hardly any credit and people always go around with a smile on there faces . i can sit here and read about high prices and things going up .taxs here there and everywhere and i do wonder where it all going to end ?? this money has to be paid back some time or does it?
good luck uk u need it !!