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very differentiable
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First of all, i have not studied economy and do not claim any expertise in that area. However, i do follow the news quite extensively, and these are just amalgations of observations combined with logical reasoning.

With both the U.S.A as well as Europe having to deal with colossal problemns considering the economy, i can't help but think that the economy in it's current state is slowly dying. First, the situation in the U.S. which is probably known to most. As the debt of the U.S. is constantly rising, it slowly reaches the limit the government might have as a debt. However, due to the absence of a majority in both of the political entities for one side (and ultimately the biggest flaw of a two party dominance) nothing is done to solve that crisis and one could speak of a stalemate. This results in the loss of trust in the dollar as a world-currency, which also results in inflation of the dollar.

Less known is the situation in Europe. The EU, modeled after the U.S., is in a crisis not seen before. As the EU harbors both countries on with debts rising fast, as well as a country that is nearly bankrupt, it struggles to solve these problems. If these countries go bankrupt, the trust in the euro too wil dwindle, as it is the currency used by all these countries. Greece, which doesn't have that big of a gnp, is being held on life support and might slowly recover. To prevent the demise of the countries with a bigger gnp that are in the danger zone, a supranational financial emtity is required that has a mandate to act independently. This requires the loss of sovereignity, which will not be accepted by every country. This basically makes it yet another political stalemate, though this one shows the flaws of a currency union that is not backed by a political union. The result is a low trust in the euro, and thus inflation.

The fundamental problem of our economy is shown by these two similar examples. The whole problem being that politics can't get a grip on the problems by it's own incompetence. The fact that stock brokers have a sizeable influence which only worsens the problems also is a big flaw in the economy, which slowly dies as a result.

The economy has an effect on us all in some way, so i'm curious what others think. Disagree, or not? Are there any solutions worth a shot?
 

Xiao

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I think a huge problem is that with globalization, we're all so dependent on each other. If America suffers, Europe suffers. If Greece suffers, the Euro suffers. There's already early talks of abandoning the Euro. Unfortunately I don't think there's any plausible way to reverse the dependence.
 

very differentiable
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That might be quite a realistic scenario, though i hope that does not happen. I think that the most succesfull option would be to reduce the influence of stock brokers, since the political route seems like hell. I have no clue how you could do that though.
 

Orion

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The question is, where does all that money go and how can it be retrieved.
It gets pumped into other parts of global or national economies to pay off a country's debts. It can't really be 'retrieved' because it ends up going more or less back into circulation anyway.

An interesting and unusual thing to note about the massive debts of the USA - probably because it's seen as such an important player in the world economy - is that its debt has become surprisingly cheap to pay off. Because I read an article about this a couple of months ago, I'm a little shady on the details, but basically now that the US has started to pay off its debt, it's been realised that it's far easier to pay off than previously anticipated, or something like that.

The entire idea of the European Union - both politically and economically - is something that should cease to exist. Yes, it does provide support for floundering nations, but its super-governmental power takes away power away from the constituent nations' own government and by extension their people. At the same time, of course making the Euro the main currency for so many countries is a bad idea in times of relative economic crises. One country flounders - let alone several - and the value of the Euro is impacted. If European countries each kept their own currencies - or the most a multi-national currency spread was over only a few - each would likely be better off financial; though the number of factors contributing to countries in a status like Greece's are too many to definitely mention causes.
 

very differentiable
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Though i wholeheartedly agree with you on the nature of the EU, i don't see it going anytime soon. It's a megalomaniacal project just to create lucrative jobs for politicians, after leaving national politics. However, it's these same politicians which have the power to step out of the EU, showing the stranglehold the citizens are in. The whole problem with the EU is the mentality of countries. Northern europe (Germany, the Netherlands, the U.K., scandinavia, Austria and Switzerland) have a mentality of working hard and fiscally conservative. The southern countries (the ones in trouble) don't eally care for working, and rather deal with things by fraud and creative accounting and thus almost have no tax income. This results in money from northern governments flowing to that of the south, while they also have to cut spending. If countries collapse or are saved, citizens will pay the price either way. Citizens from the south however, they go scott-free.
 
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Mr. Wilhelm

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I have to disagree that the idea of European Union should cease to exist. Europpean countries are all rather small, and lose lots their weight on the international scene, especially as time pass and more countries evolve.

One European country means nothing. In the end, the only solution I see for the European crisis is to go for a Federal State. Yeah, I'm French, and I'd like the Euro to fade away, because life was much cheaper at the time of the Franc. But not only it's too late, price won't go down even if we go back to our old money; but that just wouldn't be a good thing. Europe has the means to be a big player, that'd be a waste to throw away all what we've spent years to build; I'd rather we evolve upon it.

Yes, it does provide support for floundering nations, but its super-governmental power takes away power away from the constituent nations' own government and by extension their people.

I agree, but that's what I think a Federal State option is better than a disappearance of the union. It would give back the power to peoples; yet make each countries of the union stronger. I seriously think our little European countries are too little to matter on their own. Germany, maybe. But that's a different question.

If countries collapse or are saved, citizens will pay the price either way. Citizens from the south however, they go scott-free.
From what i have seen, those are moistly the rich citizens that go scout-free. As a matter of example, Greece has taxed the poor/middle class for a while, but they really started to tax the riches only very recently. And even then, that's far from enough. Of course, official excuse is that the riches can leave the country, so we better don't tax them. An understandable excuse, but this doesn't justify the absolute lack of real taxes w can see.

Same in France, although the tax is ridiculously low and they got taxed only because the riches themselves petitioned to be taxed. That's amazing, the riches have to ask to be taxed or the government won't do it... Actually I think the same happens in America, but the Republicans won't allow it to happen.
 

very differentiable
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The problem with a federal state (as one such as the U.S.) is how we get yet another layer of governance. A layer that, to many, is a lot further from the spotlight then a national government is. After all, what comes from the european government and what comes from the national government? Not to mention the distribution of power. Will the influence of nations be proportional to the amount of citizens it have, or will it be divided equally. Either way some countries will be unsatitisfied. Another thing is the fact that the U.S.A. is a nation found by immigrants, they all had something in common. What do the germans have in common with italians? Or the spanish with hungarians? Near nothing. For a federation, one needs people who share the same history, european nations don't, except for their nearest neighbours.

As the mentality in greece is shared by most of them, i doubt only the rich evade taxes. For a country to go near bankrupt, it's income must be extremely low. Seems to me that, with some exceptions, the overwhelming majority is evading taxes.
 

Mr. Wilhelm

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▽;5608557 said:
The problem with a federal state (as one such as the U.S.) is how we get yet another layer of governance. A layer that, to many, is a lot further from the spotlight then a national government is. After all, what comes from the european government and what comes from the national government? Not to mention the distribution of power. Will the influence of nations be proportional to the amount of citizens it have, or will it be divided equally. Either way some countries will be unsatitisfied.

That's going to be very difficult indeed, not to mention as you said, not everyone can be satisfied. That layer would have to be established "fairly", I don't think it's impossible. The other option is to lose the Union altogether, which is the worst. You're doing fine in the US with that system; ok you could do better but the democracy still works. Taking inspiration from your System, we could build up something good. Germany and Italia have experience of a Federal-like system with their Regions; that'd take a lot of work but we could come up with something really good for a Federal Europe. I believe talks to establish a real, fair and efficient European Constitution leading to the Federal State should start now, it's already late and if the Federal State doesn't happen, I doubt we'll avoid a dissolution of the Union (the worst possible case).

But we can't force the countries who do not wish it to join a Federal State. Becoming a mere "State" in a Federal State, as it is renouncing to your country's sovereignty it cannot be imposed to a nation by its parliament, so unlike the Treaty of Lisbon, there won't be a possibility to avoid asking peoples their opinions through a Referendum. Hence, if there are countries who are far from satisfied with the the Federal State; they just won't join it, and those who will join it are those who have an interest to do so.

If it were to happen in the next five-ten years, I think the Federal State would be made of 6 States at best (France, Germany, probably Italia, Spain and a few others). It's not a lot, but that's exactly how the Economical Union started. When it worked, it attracted more countries into the union. I believe that's how the Federal Europe would work, the new Federal State would manage to get out of the crisis, and previously unsatisfied countries would find an advantage to join.

tl;dr. That's just how I see things really.

Another thing is the fact that the U.S.A. is a nation found by immigrants, they all had something in common. What do the germans have in common with italians? Or the spanish with hungarians? Near nothing. For a federation, one needs people who share the same history, european nations don't, except for their nearest neighbours.

But we do have history in common, over 2000 years. I see your point, but the Americans immigrants were all different. English, Spanish, Germans, French, Russians even- What they had in common was the hope, their dream, whatever it was. Otherwise, they didn't have more in common than today's European have. They came from different countries, different cultures, what bound them together was their hope, their purpose, not their origins. And they didn't need more than that.

The same holds true for today's Europe, and we have 60 years of Union to back it up. WWII is still a scary thing for a lot of peoples. We got a taste of how destructive Europe is when we're divided, and of how good it can be if we are united. We shouldn't let this chance go to waste.

As the mentality in greece is shared by most of them, i doubt only the rich evade taxes. For a country to go near bankrupt, it's income must be extremely low. Seems to me that, with some exceptions, the overwhelming majority is evading taxes.

Of course, didn't say otherwise, what I meant is that the riches have been taxed only with the latest measures. When the crisis started, they weren't bothered, but the government immediately targeted middle-poor classes.
 

very differentiable
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I'm dutch, so i don't experience the U.S. system in practicality. I like the idea you have with a federal system involving the strongest economies. But i am sceptical of how a referendum will be treated by our own government. As the referendum on the european constitution was ignored by our own government (majority voted no), and was still ratified under a somewhat different guise that still didn't fool us, i am scpetical.

I think the common history and similarities between many european states aren't that present, and that, as you said, the EU was more of a means to prevent another devastating war. That is a good goal, but i think that it went to far with the EU, at least considering it's original goal.
 

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just talking about Greece, i heard on BBC world service that suicides had risen 25%, drug addictions were up, and people were turning to prostitution to fund their habits. not truly related to the economy issue, but they were considered side effects of the bad economy. so i thought i would mention it.
 

very differentiable
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Well, in a way, that is related to an f-ed economy, people become desperate. They've been able to prevent it by fooling the EU for a while, but eventually strict measures are neccesary. Might sound a bit harsh but they made it come to this themselves.
 
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