Is Soros right – Could the Euro crisis destroy the European Union?

“Germany is going to smell like roses but (the rest of) Europe is going to be pushed into a downward spiral, stagnation lasting many years and possibly worse than that,” George Soros said in 2010. And what he predicted is now taking place.

Flaws built into the euro from the start have become acute, Soros told a seminar, warning that the euro crisis could destroy the 27-nation European Union.

So it’s worth reviewing what he said three years ago: “The euro’s lack of a correction mechanism or of a provision for countries to leave it could be a fatal weakness”, he said.

German model implemented on all Euro countries

Germany has now imposed its ideas on how a 750 billion Euro zone rescue mechanism should be used. In other words, the rest of the Euro member states have to follow in Germany’s footsteps and have a trade surplus as well as a high savings rate.

Downward spiral

“That’s the real danger of the present situation — that by imposing fiscal discipline at a time of insufficient demand and a weak banking system, by wanting to have a balanced budget you are actually … setting in motion a downward spiral,” he said.

Like between World War I & World War II

“If there is no exit, (it) is liable to give rise to social unrest and, if you follow the line, social unrest can give rise to demand for law and order and (sow the) seeds of what happened in the inter-war period,” Soros said.

No interest in a Federal Europe

His conclusion is that “Political will to forge a common fiscal policy in Europe is absent and since Europe is liable to move backwards if it did not advance, the crisis of the euro could then actually have the potential of destroying the European Union,”.

His analysis based on the flaws of the Euro from the start is correct and I agreed with him in 2010, and still do. Not least since what he said is happening. It is my hope though that it will not lead to social unrest, but he may very well be right. Europeans have throughout their lives paid for their pensions, health care and all kinds of other services. Governments turning around and telling the electorate that they can not get what they have paid for isn’t ging down very well.

The danger of poverty

If Europe continues to implement austerity measures and poverty increase, the situation in Europe could turn ugly. And if so, needless to say, social unrest will take place and more and more political parties with extremist ideologies will see the light of day. And what’s worse, they will be successful.  It would consequently be beneficial if the EU would listen to the IMF and stop implementing austerity. What needs to be done is stimulating European economies to start growing again, create jobs and bring back prosperity to the people of Europe.

Do you believe that George Soros is right that the Euro crisis coupled with the current state of the world could eventually destroy the entire European Union? Or maybe only the Euro but not the whole European Union? Do you believe the Euro is worth saving? Would stimulating the European economies create jobs and bring back prosperity? Or do you believe austerity will do the trick?

(photo: mexadrian – flickr)

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53 Responses to “Is Soros right – Could the Euro crisis destroy the European Union?”

  1. jepaladino Says:

    It's possible the Euro crisis could destroy the European Union. Paul Krugman, the Princeton economist who writes a column for The New York Times, eloquently described the Euro crisis in a a recent column entitled "The Euro Trap." http://nyti.ms/dgtXwo It is worth reading for more insights.

  2. catarinaalexon Says:

    Seems we agree Amer. Knew from the beginning that there were fundamental flaws with the euro. Am not the right person to analyze fluctuations in the dollar.

  3. catarinaalexon Says:

    Really hope that the European Union will not be destroyed. Europe needs it for free trade and movement of labour. However, to have a single currency was always a bad idea, especially when you lump together countries with such diverse economies as Germany and Greece under one central bank. It's a receipe for problems. Read Paul Krugman's article some time ago about his sceptisism about the future of the euro. Thankfully he doesn't go as far as Soros regarding the European Union as a whole.

  4. GuyW Says:

    I think it's worth remembering that George Soros is, first and foremost, a currency speculator on a grand scale. His shorting of the British Pound in 1992 caused the UK to withdraw from the European Exhcngae Rate Mechanism (forerunner to the Euro) and netted him some $1.1 billion (wortha LOT more nowadays, of course).

    Could his bearishness on the Euro be the start of his trying for another big profit through shorting a currency?

    That aside, I don't see the EU collapsing – it is just too important to all member nations as a free trade zone as somewhere over 50% of member country trade is intra-Europe. What the current crisis will do is cause the EU to put real measures in place for membership (and retention of membership).

    A recession (the second part of double dip) is possible, but I think (hope!) the governments will prevent this from happening. People will need to accept that they will have to work harder and have a smaller safety net than before, though, so industrial unrest is certain.

  5. catarinaalexon Says:

    Nowadays he is more of a philantrophist Guy. Having said that he may very well look at making a profit from what's happening with the euro.

    There will almost certainly be another recession in Europe and social turmoil is also possible. However, as you know, I agree with you that it's unlikely that the EU as a whole will be destroyed.

    Another problematic country that 's outside of the euro is the UK. The trade unions there may very well create a lot of trouble. Some of them as you know, are really militant.

    However, let's hope that the current volatility will be sorted out and real recovery begins.

  6. MSK Says:

    GuyW is exactly right. If you could follow the trades, I would bet that Soros shorted the Euro before making his comments. He will make billions again off the backs of the worst affected, then claim to be a great philanthropist later on when he donates 0.001% of the profits, which will still be millions. The man always has an agenda. Don't be fooled.

  7. catarinaalexon Says:

    Chris as far as I'm concerned Soros isn't the important issue here. What interests me is what will happen in Europe because of the euro crisis. That there will be another recession is almost certain, social unrest could very well happen but hopefully the European Union will not collapse as a result. What is your opinion?

  8. catarinaalexon Says:

    To me as a European, the important issues here is what will happen in Europe becasue of the euro crisis. Another recession is in my opinion almost inevitable and social unrest is possible. I do hope however, that Soros is wrong when he says that the whole European Union may be at risk. But it could happen. What is your opinion?

  9. Laura Sherman Says:

    I can't say that I'm an expert in this area. However the one thing that I can comment on here is that I was very concerned with the concept of the Euro when it took over. I hated the idea that the individual countries were giving up their currency for a universal one. It just seemed dangerous.

  10. admin Says:

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  11. Badar Says:

    EU is a project and an experiment. The sponsors of this project are: a) BIG business and b) some others with global political goals. It took Europeans a few centuries to come to this point. Europe is going down economically for many reasons some of its own making and some not. Euro is crucial in keeping the EU intact. If it goes down, EU can be seriously threatened.

  12. tariq Says:

    Yes, the main point is if the Euro falls, then will it lead to more riots and more uprisings in the streets, you can bet on your Euro that it will.

    The only way to rein the people in to a common point is to engage with an ‘enemy’ and only during conflicts are people willing to listen and scarifice to a single voice.

  13. catarinaalexon Says:

    Tariq there are already riots and have been for years. However if another recession, or worse, depression hits you will have more such problems.

    Nobel price winner Paul Krugman and others think there is a big risk there will be a world-wide depression. If so Tariq, not only Europe but all countriesm, including yours, will have. So let's hope your comment will not happen.

  14. BFY123 Says:

    Soros is a speculator….well, in free-market economy, we're all speculators. Any time I acquire an asset, I assume that I am getting a great deal. Ironically, the seller believes he/she is getting a great deal. When I do business in France, I keep my mouth shut (or even praise socialism). In the US, most biz owners/decision-makers tend to praise socialism only when it serves their biz needs (oh, such as getting a government contract from Democrat-controlled government entity, etc). SOROS IS AS MUCH OF A BRILLIANT, PROFIT-DRIVEN MAVERICK AS DONALD TRUMP IS. Soros' first big financial success was a result of his ability to shake investors' confidence in Britist Pound Sterling (hey, we may dislike him and his methods, but this is business….as far as I know, he did not break any laws and he exercised his freedom of speech — fundamentals of capitalistic system….so, SOROS AND HIS PREDICTIONS REGARDING EURO OR EU ARE NOTHING MORE THAN "BUSINESS AS USUAL" :-).

    Having said the above: I don't care too much for Soros and his "methods"…but, this is my own, subjective opinion.

    EU & Euro: I am pessimistic about future of Euro and EU.
    I lived and worked in Brussels for a while (and few other EU countries) . To put it bluntly: unlike the Union that evolved naturally into the United States, EU/Euro are an artificial "creation." I apologize for my cynicism, but EU/Euro remind me of the game of Monopoly. Yes, the board game. Deutsche Mark's strength was a result of its economic power, etc. It stemmed from the coordinated fiscal policy by Germans….On a very basic/fundamental level: before Euro, if Germans pulled off the stunt we've witnessed in Greece, I DOUBT THAT THE DUTCH OR THE POLES WOULD FEEL TOO SORRY FOR THOSE IRRESPONSIBLE GERMANS! Let them starve so they'll learn how to live within their means!!
    Anyway, I am stating the obvious: as a resident of Florida, I don't expect for my taxes to ensure a comfy life-style of Alaska or Nebraska, or whatever. If my neighbor goes bust, I try to help out, but I don't hand over half of my life savings.

    EU has become a monster…national interests supersede EU interests. EU reminds me of what former European colonial powers did all over the world — they'd created arbitrary national borders in Africa, Asia (Irag!!!) without any regard to inhabitants' sense of nationality, religion, language, etc. Sorry, but it's rather surreal to expect EU members to agree on ANYTHING!!! National/cultural identity that has evolved for a thousand yrs cannot be changed via a decree or a referendum. Look at the Balkan region…look at divided Cyprus…look at Belgium on a brink of breaking up!!!

    Euro as a currency: well, call me an idiot, but I feel comfy with my US dollar.
    – Greece knew that it would never be allowed to default….if Greece defaulted, then the entire European Union and Euro currency would cease to exist overnight.
    – When I hear people talking about China or Russia replacing their foreign currency reserves from US dollars to Euros, I feel like laughing. For some reason, OPEC sticks to the US dollar.

    Greek crisis exposed the fundamental weakness & uncertainty associated with EU and Euro. My European friends tend to say: there would be no Euro without Germany & France. My question is: WHAT HAPPENS IF GERMANY'S ECONOMY WERE TO COLLAPSE? Would the Estonians be able/willing to save this rather idealistic dream of "Europe as one nation",

    EU and Euro did just fine when EU's membership was limited to a small group of wealthiest European countries and when the post-war economic boom allowed Europe to establish a comfy (but unsustainable) social safety net, etc.

    The Greek crisis (which is likely to be followed by countries like Spain or whoever) drove one point home: the party is over. We lived it up for 50 yrs . Now, it's time to pay for it.

    I hope I am wrong. And, I really don't care what Soros has to say about it all. Soros is simply trying to do what he did in the past — make a financial killing thanks to instability of one nation's currency. Right now, EU and Euro are one nation just like UK was back then. So, do we really need Soros to tell us what to think and where to invest?
    Jay Yurkiewicz

  15. catarinaalexon Says:

    In other words, despite what you think of Soros, you agree with his statements. So do I. By the way, how often is Soros wrong?

  16. BFY123 Says:

    I agree with his CURRENT position re: EU and Euro's future. Yet, Soros has a tendency to speak out on controversial subjects (especially when these comments attract media's attention). For example, his sudden lack of faith in "socialist" system sounds a bit amusing….attention is guaranteed when one of the most "notoriously socialist" American billionaires seems to lose faith in "socialism."

    But, it's easy to praise socialism (read: big government, etc) and act like a philantropist when you have more money than you need. His ego (as for any financier) is rather large — despite his only claim to success is a lucky bet against the pound that netted him billions of $. Since then, he became more interested in politics/influence/celebrity status than in actual business. For example, in the 1990's he tried to become a "major power broker" in former communist countries, especially in his native Hungary.

    I put Soros and Trump in the same category re: ability to predict future :-). If you make 100 ridiculous predictions, you're guaranteed:
    – media attention
    – the odds are that one of your "nutty" predictions does come true…great for an ego :-)

    Of course, the above comments should not be misinterpreted. I have utmost respect for Mr. Soros (and Mr. Trump) and businessmen, philantropists, human beings, etc :-)

    Jay Y.

  17. catarinaalexon Says:

    The purpose of a headline is to attract attention. If you put Soros name in it you get more readers. I happen to agree with him regarding Europe and hence put it in his name instead of mine. And it worked.

    Your personal feelings aside, Soros is astute when it comes to predicting what will happen with the world economy. If he earns money because of it, good for him. Most specutlators keep a low profile i.e. they don't let the world know what they believe/fear will happen – just make money for themselves. :)

  18. Jay Yurkiewicz Says:

    Catrina, you got it!!! AS LONG AS SUCCESS IS LEGAL & ETHICAL, THEN IT EARNS MY COMPLETE ADMIRATION. And, I find the following fact amusing: the more successful you are, the more criticism you tend to receive even if everything you do is 100% legal & ethical.
    Humans are programmed to be envious/resentful of others' success, aren't they?

    Of course, my generalization about human nature opens another can of worms :-). Needless to say, this is a ploy on my part — to make a controversial generalization in order to generate "response/reaction" :-). In all seriousness, I'd love to pose a question: is there such a thing as BAD PUBLICITY? For example in case of Tiger Woods? (haha….Tiger's name does attract attention, doesn't it?..and so it goes).
    Jay Y.

  19. catarinaalexon Says:

    Human nature is the way it is and has always been since time immemorial. People behaved the way they do today during the Roman Empire and will keep on doing so. It's amazing that humanity doesn't learn from history. But it boils down to human nature. By the time one generaton has learnt and evolved another generation takes over that are yet to learn.

    There is no such thing as bad publicity. Only that you have to be able to stand all the critizism, which can be trying sometimes.

  20. GuyW Says:

    It's interesting to revisit this now in the light of the continuing problems in the Eurozone. I still can't see the Euro collapsing completely as it's too important to the main founding nations, especially to Germany and France.

    The problem was really that while there were clear requirements in terms of deficit limits, etc., for nations joining the Eurozone, there were no consequences for nations failing to maintain those levels once they were in.

    I'm increasingly of the opinion that Greece will end up in default and will leave the Eurozone, reverting to its own currency so that it can float the currency appropriately to its financial position. However, I can see a future Eurozone of two parts: those countries (the strong, central ones) where the Euro is the only currency, and those (like Greece) that reintroduce their own currenices, but where the Euro is still legal tender (albeit on a floating exchange rate with the local currency). This is similar to a number of countries in Central America that allow the US Dollar to be used as legal tender while maintaining their own currencies.

    This will assure the Euro's survival and enable the free-trade zone to continue unimpeded, as well.

  21. catarinaalexon Says:

    Glad you agree that a re-publishing this article was a good idea. Let's see what will happen. Maybe a two tier Euro zone, maybe not. Seriously it would be better to admit a common currency was a mistake and abolish it, but something drastic probably have to happen for that to take place. :-)

  22. keithrossiter Says:

    Fascinating conversation. I'm tending to be on the side of the Soros-sceptics who remember all too well what he did last time round and mistrust his motives.
    Why does differing sovereign wealth within the EU matter more than differing state wealth matters within the USA? I'm not saying it doesn't matter, only that I can't see the mechanism.
    Surely it matters only if the citizens of the rich areas don't buy into the collective presumptions, which I think in Germany and France they do to a great degree.
    It's a pity the UK stayed out of the euro, for all its flaws.
    Where would you draw the line in transnational currencies? For example, some Transition Towns have created their own local currency. Is that a good, bad or indifferent idea?

  23. catarinaalexon Says:

    Keith the UK economy was doing fine until Gordon Brown got his hands on it. Like other EU countries such as Sweden and Denmark the UK economy was doing very well outside the Euro until the advent of Mr Brown.

  24. Marquita Herald Says:

    Very informative article, as are the comments. I won't pretend to be up on this topic, but I can certainly see the areas of concern and the skepticism expressed about Soros under the circumstances. I'll be watching for more news and to see how this matter evolves. Thanks for the enlightenment!
    My recent post 30 Day Self-Discovery Challenge

  25. catarinaalexon Says:

    Glad you like my article Marguita.

  26. Arno Uijlenhoet Says:

    This is mainstream thinking of mr. Soros. The point is that in the end no national/european political leader has the courage and even the political power to say no to financial help to EU-states in financial and economic problems. Even now, were rightwing politics is flourishing (as for example in The Netherlands) there's support for bailout operations. The cynical point is that its not about helping countries, but about helping the banking- and institutional investing sector, it's about helping our pensions.

    What realy is at stake is the fact that the European people are not part of the decisionmaking proces. This lack of democratic, legitimate decisionmaking is what in the end might create a collapse of the EU: populism and nationalism is not a result of the financial and monetary crisis within the EU, it is the result of the lack of leadership of national politicians to say that we need a political Europe. By talking in a nationalistic fashion and acting European they fuel populism at home and throughout the EU. So democracy is at stake! It's time for normal EU-citizens to take a stand! We need a new French (European) revolution! Perhaps the most valuable outcome of European history is at stake, not the Eurozone: democracy….

  27. catarinaalexon Says:

    Yes Bob, it looks like that will happen. The Euro was a bad idea from the beginning. And the US definitely is in dire straits.

  28. catarinaalexon Says:

    Yes growth and decline are cyclic. But that's another issue. If the EU is destroyed that may not be such a good idea, however.

  29. catarinaalexon Says:

    Good points Arno.

  30. Jane | Find All Answers Says:

    Thanks for the informative article Catarina. Just like Marquita, I am not too familiar with all these. I would surely Google it up to find out more.

    Jane.

  31. Tisha Says:

    Wow…I hope it does not lead to anther recession or a social unrest. I can understand your concern. It seems like this kind of problem is happening in the leading countries all over the world. I hope that it all will be resolved soon

    Tisha

  32. catarinaalexon Says:

    Firmly agree with you Tisha.

  33. Andrea Toscani Says:

    You cannot build something as complex as the European Union without having a roadmap that includes all required "areas of integration": economy, politics, law and defense, just to name the top four.
    The huge difference in speed between them is the root cause of the crisis, in particular reaching as far as having a single currency with a European Central Bank, while the economic situation of single countries is so different and, even worse, the gaps are getting larger and single governments are basically acting independently.
    The original plan of converging to some agreed ratio (Deficit/GDP and Debt/GDP) has failed and there isn't any official long term plan to reform the EU.

    Now, I wouldn't go as far as foreseeing a new Weimar Republic, like Soros tries to suggest, but this is definitely a "up or out" situation that requires immediate strategic decisions, while politicians seem only worried about avoiding a Greek debt default. Greece is only the tip of the iceberg and inaction is not an option.

    Andrea

  34. keepupweb Says:

    These are such unsettling times Catarina. I can't fathom how this will pan out but I'll keep following your blog. I learn not only from your well written articles but (as another reader mentioned) also fron the comments.
    My recent post 6 Reasons to NOT Build a Website

  35. catarinaalexon Says:

    Thank you Sherryl, glad you like the content of my blog.

  36. catarinaalexon Says:

    You are so right Andrea, Greece is only the tip of the iceberg. The Euro was a bad idea from the start. Catch is, how will the EU get out of it?

  37. konraad Says:

    Very nice article, but I think it is important to focus on the underlying issues. Many Europeans will not like to admit or hear that the new generation of Europeans (not generalizing) is not as hard working as the baby-boomers, is very spoilt thanks to the entitlement programs and as result Europe is lagging behind as compared to the emerging countries. The sooner people work up to this reality the better, everything else are just symptoms of a society that is no longer as productive as it once was but still wants to live a good life… unfortunately the two don't go together…

  38. catarinaalexon Says:

    Good point Konraad.

  39. wedding favors Says:

    Those criminals are taking advantage the weaknesses of the refugees. And it is hard to stop them if this is a long time modus operandi, yet the European government can help them by sending securities and accompany these people in different centers or safe place where they can start their new life. :)

  40. catarinaalexon Says:

    Guess this comment is for my article "What would make you flee to Iran?"

  41. Timothy Burns Says:

    Soros rarely comments on financial or economic conditions without an ulterior motive. He doesn't cite existing conditions from an objective perch, He comments in order to move conditions in a direction that serves his profitability, as do all Marxists.

  42. mkslagel Says:

    I wish I was more knowledgable about the European economy. I have tried to keep up with the status of the Euro as this has all unfolded, but to be honest, I have not done my best to educate myself. I would say however, that when the Euro was introduced, I was very fond of the idea and it definitely made traveling through out Europe much easier, but I can see where it is creating the issues.
    My recent post The Liebster Award

  43. catarinaalexon Says:

    Yes in theory it would be wonderful with one continent – one currency. But try to imagine if the US had the same currency as Brazil, Argentina, Honduras and the rest of Central and South America. Or even just the Nafta countries Mexico and Canada. Unless the mechanism is perfect from the beginning you are heading for trouble.

  44. yearwoodcom Says:

    I don’t have enough information to have a good conversation, so please jump in and clarify. :)

    I''ll start by saying that I find the situation that has developed in Europe so disappointing. There was so much optimism associated with the development of the Euro. Imagine, countries leaving behind their historic protectionist attitudes towards their own currency in exchange for a simpler and what was hoped to be, a more efficient system. Yes, there have always been naysayers who saw the pitfalls that are now being experienced, but there was something appealing about the coming together of all those countries and the potential to do more than just agree on currency. It’s a pity that the agreement was on the currency alone and not also on life style. Is it not in Germany’s interest to make staying part of the Euro appealing? It seems that there would be more benefit all round to forgive much of the current depts and lose the austerity measures than to maintain their stance and have anarchy suddenly seem like an appealing option. Wouldn't getting rid of the Euro hurt everyone at this stage, including Germany who gets to sell their products at "bargain basement" prices? Wouldn't currencies go into wild fluctuation or worst still, free fall…or am I missing something?

    My recent post Tips For Planning A Media Event – Part Two, Getting It Done

  45. catarinaalexon Says:

    Have in-debt knowledge of how flawed the mechanism of the Euro was from the beginning since one of me ex'es was at the time advisor to the governor of the Bank of England. They realised that what happened would happen, just a question of when. And, as you know, the UK did not join the Euro. The only country benefitting from the Euro seems to be Germany and they hence want to keep it. But unfortunately the Germans are not prepared to support the other members, hence the austerity measures. Don't forge that there are parliamentary elections in Germany in September. The situation would not have been as bad as it is today if the crash of 2008 hadn't happened. But it did and it ruined the economies of some Euro member states. German banks sits on a lot of Greed debt which is another reason. Anyway, if they are not careful the people of Europe will rise. They have done it before and it could easily happen again. People who are used to having an affluent life are not prepared to put up with poverty. The idea of the European Union was good at the start. But unfortunately it has developed into an institution of benefits i.e. the North supports the East and South. Needless to say that's an equation that's not sustainable in the long run.

  46. Richard Says:

    Another interesting question is: how did Mr Soros become a trustworthy person? He made a fortune by plundering small countries during the currencies crisis. He didn't give a shit about farmers in Vietnam, workers in Sweden when he made his money. And now he's the good guy, a philanthropist, as Wikipedia puts it. Well, well, if Kissinger got the Noble peace-price…

  47. Susan P Cooper Says:

    The United States has faced this situation and though I am not an expert, I know there is so much more work to be down here. We have seen an extreme economical and social shift in recent years. We have seen an uprise in violent crimes and the middle class have shifted to a lower class. It has taken so many sacrifices on the parts of many people and I hope Europe does not have to face the same.
    My recent post User-Friendly Invoice Software

  48. catarinaalexon Says:

    Richard, Soros is not the main issue here, even though he is good at predicting what will happen, or can be made to happen, which is how he made his money. What's important here is what will happen in Europe.

  49. catarinaalexon Says:

    Good comparison, Susan. Europe is going down the same route, unfortunately.

  50. @patweber Says:

    You are spot on Richard. At least here, in the USA, Soros is not universally thought of as trustworthy or respected.
    My recent post What Is Productive Procrastination?

  51. catarinaalexon Says:

    Pat, have you thought about the fact that if Soros and the financial markets decide to get rid of the Euro, and for that matter, the European Union, they can:-) That's why what he said is interesting. Besides the unrest is starting. People are still a bit stunned. But one day it will turn into anger and then what?

  52. @patweber Says:

    While it is of monumental importance what is happening both in Europe and in the USA, tempering what Soros says is important since I have seen what his greed has done – to innocent people. Still, it's amazing to me that we do NOT learn from history. Many of the same issues occurred during the days of the Roman Empire. It was corrupt politicians (sound familiar?), it was a government which was to represent the people which became a ruling class (ring any bells?), it was high taxes (got it?) and the list goes on, which attributed to one of the longest, if not the longest, countries (empire then) in the world.

    You asked, "Would stimulating the European economies create jobs and bring back prosperity? Or do you believe austerity will do the trick?" My thinking is, we need the right intervention, and while austerity has worked in the past, ie, WW2, would it work now when corrupt uber wealthy like Soros are really the ones pulling the strings and the rest ie, government officials, every day people, are just puppets? I don't know.
    My recent post What Is Productive Procrastination?

  53. catarinaalexon Says:

    Pat, as you know I have written articles comparing the world today to how it worked during the Roman empire. There are a lot of similarities. But the problem then, as well as now is human nature. Greed is unfortunately a part of human nature that we are not able to root out. Why? Because once one generation has learnt what's important in life another one takes over and greed is back.

    When it comes to Europe today austerity is not creating jobs – on the contrary. When it was decided who should carry the burden of the debts of countries such as Greece, Merkel and the EU met with the banking lobbying group IIF. Merkel didn't want the taxpayers to pay the price, but the IIF got Merkel to agree to let the taxpayers carry the burden and let the banks off the hook. The lobbyist from IIF called Joseph Ackerman, CEO of Deutshe Bank, to get the OK, before agreeing on a deal with Merkel and the EU.

    When a private person gets into debt austerity works. But when it comes to economics it's not that simple, unfortunately. Comsumption is vital for an economy to grow so when austerity is implemented it stops an economy from growing and doesn't create any jobs.

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