The English press and the euro crisis

The appropriate attitude to the global economic crisis?

 



Since the economic storm hit us all, I have been intrigued by the differing attitudes of the English - or I should say Anglo-Saxon - press and their French colleagues.  As far as the latter are concerned, France is basically ok and a collapse of the euro is more or less unthinkable - or, if thinkable, not desirable.  Whereas the Anglo-Saxons regard the collapse as inevitable, displaying a rather unattractive Schadenfreude whenever there is an adverse turn of events that makes things more difficult on the Continent.  Similarly, the Anglo-Saxons regard the French economy as floating on air, while the UK is basically solid.  On this point, however, the French usually confine themselves to commenting that the UK is in no better a situation than France.

This last is the one point that appears accurate.  The two countries have a similar debt/GDP ratio.  In principle France could resolve its problems by slashing the public sector, which sounds easy for a country with one of the highest levels of government costs in the EU.  In practice this is far from easy, and could cause massive social unrest.  The UK has a leaner public sector, so there is no easy solution, and tax revenues are less than anticipated.  The austerity vs. growth conundrum is similar in both countries.  And while France is exposed financially in providing support to the southern European states and Ireland through the central EU mechanisms, it also has the richer EU partners to lean against. 

My own concern is that, in each of Greece, Spain, Portugal, Italy and France there are profound cultural changes that have to occur before I can see any material improvement.  And I don't see how that is going to happen.  For example, in Greece the professional classes - which count the majority of MPs among their number - habitually avoid (possibly evade) their taxes.  Nothing much is to be gained by cutting salaries and pensions of civil servants while this sector of the population effectively escapes having to join in the pain.  In Spain, Italy and Portugal cronyism is the name of the game, blunting competition.  In France the burden of bureaucracy on business has to be eased in order to free up the entrepreneurial energy that is being stifled in the private sector.

I have to say that I don't see how any of these issues are going to be satisfactorily tackled.  In the circumstances, I think that our dog Oscar, pictured above, has found the appropriate solution: find a patch of sun, stretch out and go to sleep!

Antony Mair