Red Ice News

The Future is the Past

A new stage in the euro crisis
New to Red Ice? Start Here!

A new stage in the euro crisis

Source: wsws.org


Reading the latest headlines on the euro crisis, one experiences a feeling of déjà vu. Like last summer, the rating agencies are lowering their ratings, interest rates for government bonds are rising to astronomical heights, and governments are announcing new austerity measures. Only this time Spain has supplanted Greece, whose economy is just one fifth the size of Spain’s, as the focal point of the crisis.

Despite the billions in bailouts and trillions injected by the European Central Bank, as well as round after round of austerity measures, the euro stands closer to the abyss than ever before. “We believe that Europe is sleepwalking toward a disaster of incalculable proportions,” 17 leading European economists warn in a report published this week.

It would be naïve to attribute the worsening of the crisis to a purely technical response by the markets to rising public debt in Southern European countries. Even the Financial Times’ editorial on Wednesday acknowledged that Spain’s public debt is “well below the euro zone average,” and that “there are no underlying economic reasons to feel differently about Spain now than a week ago”. Nevertheless, interest rates on ten-year Spanish bonds have risen far above the critical level of 7 percent.

Behind the onslaught on the euro lie fundamental class interests. The international financial oligarchy that dominates the financial markets and stock exchanges will not rest until all the social gains won by the European working class after World War II have been destroyed. In their eyes, collectively agreed upon wages and workers’ rights are illegitimate restrictions on their wealth, as is government spending on education, health, pensions, public services and infrastructure.

A definite pattern has been established. First, the rating agencies downgrade the creditworthiness of a country, which results in an increase in the interest it must pay on its debt. The country falls into a debt trap and turns to the European Union (EU) and the International Monetary Fund (IMF). These institutions, dominated by the major international banks, guarantee the creditors’ loans and dictate drastic austerity measures to the country. It slides into recession, the debt continues to rise, there follow further austerity diktats, and the recession deepens—until the welfare state is destroyed and the working class is ruined.

[...]

Read the full article at: wsws.org

Comments

We're Hiring

We are looking for a professional video editor, animator and graphics expert that can join us full time to work on our video productions.

Apply

Help Out

Sign up for a membership to support Red Ice. If you want to help advance our efforts further, please:

Donate

Tips

Send us a news tip or a
Guest suggestion

Send Tip

Related News

Being Beastly to Scoundrels: European Police Forces in Crisis
Being Beastly to Scoundrels: European Police Forces in Crisis
Erkenbrand Conference - European Resurrection: Identitarianism in Europe
Erkenbrand Conference - European Resurrection: Identitarianism in Europe

Archives Pick

Red Ice T-Shirts

Red Ice Radio

3Fourteen

How Right Wing Is Japan Today?
Yoko Mada - How Right Wing Is Japan Today?
European Cooking & Philosophy
Elisabeth - European Cooking & Philosophy

TV

The Great Twitter Purge: What Should We Do? - Operation Reinhard
The Great Twitter Purge: What Should We Do? - Operation Reinhard
Infiltrating Flat Earth International Conference - Leftovers
Infiltrating Flat Earth International Conference - Leftovers

RSSYoutubeGoogle+iTunesSoundCloudStitcherTuneIn

Design by Henrik Palmgren © Red Ice Privacy Policy