10.30.2011 12:00 AM

In today’s Sun: how we’ve avoided the European contagion

As we peer across the Atlantic — shaking our heads in wonder at the implosion of the European Union (EU) — give thanks, Canadians.

In comparative terms, we’re in pretty good shape. In fact, we’re in really good shape.

The European “leadership,” meanwhile, is busily at work on blowing itself to bits. The EU has become “ungovernable,” billionaire George Siros said this week, adding that “a dynamic of disintegration” is tearing through Europe.

Early on Thursday, European leaders hammered together a deal, of sorts, to save the Union from ruin. But the 11th-hour deal addresses the symptoms of the crisis, not the root causes. Greece still has a debt level that is an extraordinary 150% of its gross domestic product (GDP).

Italy, with a far larger and far more significant economy, still has a debt-to-GDP level of nearly 120%. Places like Ireland are deeply in recession already — and there, as in Belgium and supposed super-powers like Britain and Germany, the debt-to-GDP ratio hovers at or above 80%. The exit of one or more countries from the EU now seems inevitable.

The damage done to European economies has been mainly self-inflicted. In some Euro-zone nations, their approach to pensions, retirement, taxation and public spending is the stuff of science fiction. The Union did little or nothing to address the economic cancer that has now spread throughout Europe.

9 Comments

  1. Pete says:

    True enough it was not fiscal conservative monetary policy or we would be worse off than Greece right now. Thanks to the keptomaniac Mulroney we were nearly bankrupt. Chretien/Martin returned the lost funds to the provinces when times got better and did so in spades. In terms of the so called UI fraud, why hasn’t Harpercrite returned the fund it to its former independence.

    There was no choice but to cut provincial transfers and other expenses. In terms of burgluring we just always refer you back to the G8 which is where the largest theft ever of public funding occured.

    Your red neck abusrdity is starting to make me think of more “ma and pa” red neck jokes. You fit tright in.

  2. Cam Prymak says:

    Right after they inherited the massive deficit from Mr. Mulroney and the Conservatives.

  3. Cam Prymak says:

    What I remember is Mulroney ‘Conservatives’ raising taxes to eradicate a deficit and then watching them continue to spend. Some time later, the Chretien Liberals eliminated the problem and began paying down the national debt.

    Time to man-up, Gord and stop blaming Liberals for the world’s problems.

  4. Cam Prymak says:

    “In a little-noticed speech before the U.S. Chamber of Commerce, Clement lauded the government of Liberal prime minister Jean Chretien for “rather remarkable” fiscal reforms in the ’90s which have protected our economy ever since.

    Said Clement: “Successive Canadian governments, across political lines, faced the challenge square on, delivering fiscal reforms that started us on a path to balanced budgets.”

    This is one of the first times I’ve heard such an acknowledgment from a key Conservative and I think it appropriate to applaud Mr. Clement’s non-partisan view.

  5. Mandos says:

    You neglected a major reason why Europe is in this pickle, if not THE major reason: Greece cannot export at German currency rates. Or, you can put it as: Germany refuses to become an importing country and insists that everyone be in a trade surplus, which is mathematically impossible. Either Germany must subsidize Greece directly, or agree to devalue the Euro to give Greece time to catch up. Neither one matches the German way of doing business—so, impasse.

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