EU

[CaptainPanic]

The EU mandarins like to portray themselves as some sort of essential requirement to enable market forces, but they aren't and they don't. They just burden and hinder market forces. That's why countries within the EU are overburdened with debt and essentially bankrupt, because they are overburdened with bureaucracy and rules and the policy of throwing money at problems.

 

You build your argument on the first assumption, but the first assumption is just not necessarily true. The EU is government is not some sort of essential requirement to enable market forces, and they do not see that as their primary task - if you disagree, please provide a source for that. There are far more rules and regulations in the EU, and the EU tends to be far more socialist too. You can argue that this is merely a burden or a hinderance, but there are people (like myself) who vote for socialist parties and are happy to see their political views reflected in EU policy. Also, as this crisis has shown, certain countries (e.g. the Netherlands) are quite capable players on the international financial market, striking rather good deals in the bail-outs of insurance companies and banks. The Dutch didn't bail-out a bank, they just bought it. I would be surprised if they cannot sell it at a profit (although time will tell). If anything, the EU is some sort of essential requirement to hold back the extremes of market forces.

 

As for bailing out countries like Greece... I agree that lending them money at a low interest rate is probably a bad investment for the short term - and the investment itself may never be paid back. But from such a short-term perspective, the Marshall plan was probably a horrible idea too. That investment by the USA in Europe only paid back decades afterwards.

 

But you all seem to portray the entire EU as a financial disaster, but looking around me (and living right in the middle of it), I just don't see it. Sure, Greece, Spain, Italy, Ireland, Portugal and Cyprus are in financial trouble. But altogether, that is a minority of the total EU economy. The Scandinavian countries, as well as Germany, and multiple Central and East-European countries are doing surprisingly well. The EU has absorbed a number of weak economies, and pumped billions into it in order to make them stronger. In many East European countries (as well as the Baltic) this is a complete success, as the GDP growth in the period 2005-2012 shows. And the EU is still the largest economy in the world.

[Delbert]

 

Yep, and it's better to confront said market forces with the power of numerous economies under one control, than it is for each comparatively small individual economy to do so on their own. I wish what you're saying was true, but it's just not the case.

I'm not disagreeing with you in terms that such would be nice. But by setting up control as you suggest one has to create suitable rules. But introducing rules, or new rules, simply changes the environment in which market forces operate. Market forces would still operate and be cold and brutal as I described. You will still be competing in the world market, and manufacturers will still move their operation abroad if it's cheaper.

 

One also has to give consideration to one's customers, and perhaps that's why the Chinese are investing as mentioned. I also read the other day 27% unemployment in Greece.

 

If you need to build a new factory, would you build it in a place with tight and controlling rules when your competitors have theirs in places with freer rules?

 

As said, we might not like cold and brutal market forces, I can't say I like them too much, but I suggest we freely and willingly engage in them everyday without a second thought. Even brag about a good deal we might have got. We even like it so much we get very excited about free money - you know, winning a competition like the lottery.

Edited September 9, 2013 by Delbert

[CaptainPanic]

But the EU is one huge experiment where multiple markets with multiple sets of rules are slowly merged into one huge market with the same set of rules.