True, but that came mostly from being in a beggar’s shoes and not so much from how the EU political system is structured, though it’s not like there isn’t any overlap…
Both Portugal and Greece used to “solve” (temporarily, of course) such problem when they had their own currencies by changing the interest rates to essentially inflate away the excess debt, something that they can’t do in the Euro.
In fact, if you look at for example the history of GDP Growth in Portugal, you see a huge increase in growth after the 1974 revolution (which replaced Fascism with Democracy), then another increase when the country joined the EU and then a steep decrease down to levels barely above those during Fascism when the Euro came to be.
Those countries gave away their control over their monetary policy and thus when push came to shove the big countries fucked them up spare large banks from those countries having to suffer the consequences of lending money at stupidly low interest rates to countries whose economies and economic and fiscal policies did not justify it.
Giving up on having a Central Bank has consequences, but none of them are relevant in the context of comparison with US states, as this thread started from, because they also all use the dollar and have the same central bank.
If I’m not mistaken, in the US there are money flows at the Federal level from the stronger economies to the weaker ones.
There is no such thing in the EU beyond the “structural funds” which countries with weaker economies receive when they join but which stop after a while (and which both Portugal and Greece wasted in roads and corruption).
So those two situations are not the same, they’re only partially similar.
You mean the growth and stability pact? That puts caps on deficit and debt, and would force austerity measures, but had been repeatedly broken, notably by Germany and France in the early 2000s, with no punishments, so it’s a very week mechanism at this point.
The Greek and Portuguese bailouts were negotiated with the “Troika” of the European Central Bank, European Commission and the International Monetary Fund. These weren’t part of EU law at all, but a consequence of the absolute failure of the stability mechanisms and a widespread fear that defaults would drag a bunch of other countries along and cause massive economic turmoil - remember that this is in the follow up to the 2008 crisis.
More the other way round during the last sovereign debt crisis.
Ironically it’s France that’s now drowning in debt.
True, but that came mostly from being in a beggar’s shoes and not so much from how the EU political system is structured, though it’s not like there isn’t any overlap…
Nah, that came from being hogtied by the Euro.
Both Portugal and Greece used to “solve” (temporarily, of course) such problem when they had their own currencies by changing the interest rates to essentially inflate away the excess debt, something that they can’t do in the Euro.
In fact, if you look at for example the history of GDP Growth in Portugal, you see a huge increase in growth after the 1974 revolution (which replaced Fascism with Democracy), then another increase when the country joined the EU and then a steep decrease down to levels barely above those during Fascism when the Euro came to be.
Those countries gave away their control over their monetary policy and thus when push came to shove the big countries fucked them up spare large banks from those countries having to suffer the consequences of lending money at stupidly low interest rates to countries whose economies and economic and fiscal policies did not justify it.
Giving up on having a Central Bank has consequences, but none of them are relevant in the context of comparison with US states, as this thread started from, because they also all use the dollar and have the same central bank.
If I’m not mistaken, in the US there are money flows at the Federal level from the stronger economies to the weaker ones.
There is no such thing in the EU beyond the “structural funds” which countries with weaker economies receive when they join but which stop after a while (and which both Portugal and Greece wasted in roads and corruption).
So those two situations are not the same, they’re only partially similar.
EU austerity was enforced though. That’s no different from federal law
That statement is just too vague to address.
You mean the growth and stability pact? That puts caps on deficit and debt, and would force austerity measures, but had been repeatedly broken, notably by Germany and France in the early 2000s, with no punishments, so it’s a very week mechanism at this point.
The Greek and Portuguese bailouts were negotiated with the “Troika” of the European Central Bank, European Commission and the International Monetary Fund. These weren’t part of EU law at all, but a consequence of the absolute failure of the stability mechanisms and a widespread fear that defaults would drag a bunch of other countries along and cause massive economic turmoil - remember that this is in the follow up to the 2008 crisis.
Six-Pack, Two-Pack, and the 2012 Fiscal Compact (Treaty on Stability, Coordination and Governance)
https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX%3A52012DC0342