Last month, the president of France Nicolas Sarkozy and German Chancellor Angela Merkel announced new initiatives to tackle the growing euro zone debt crisis. Some of these initiatives include: taxing financial transactions to raise much-needed revenues, syncing German and French corporate taxes, and electing a euro zone head. This announcement came shortly after a much anticipated economic summit in Paris the two attended. As the two leaders have become more known working more and more closely, the two have begun to know as “Merkozy” jokingly. All of these events appear to be leading up to one of two, a full scale unification of fiscal policy or a messy breakup for “Merkozy.” If the two countries do, in a way, have this fiscal marriage, they will in a sense create a United States of Europe; some believe this to be essential and inevitable. However, even with all these events taking place, the markets and the euro’s value have continued to decline.
This article discuses a global social problem happening in Europe, the euro zone debt crisis. It is causing economic turmoil for both citizens and Europe’s society as a whole. Both leaders recognize that this is a problem and are trying to fix it with their new initiatives. With these initiatives yet take effect, one has to ask if it will be enough or if it will be too late. Investors in France are unloading shares in banks with copious amounts debt and their government is rumored to be getting a downgrade on its credit rating. Germany isn’t doing much better with their economy stalling. The next thing one has to ask is if unifying their policies and becoming a joint entity is really the best idea.
http://www.globalpost.com/dispatch/news/regions/europe/110816/merkozy-merkel-sarkozy-fiscal-union
2 comments:
The growing debt crisis in Europe is very predictable. At this stage in the global economy every nation is struggling financially. The debt crisis in Europe will affect us also.
We all saw this crisis coming. You can't run on a trade deficit forever somehow the economy will work itself out to the point where it hits rock bottom in order to get back to the state in which it can run in an orderly manner without being at such a low in the economy.
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