I bet it won't because more austerity means less tax collection etc. I'm not saying France should not reduce their public spendings which are indeed high but doing it in a such a drastic way at a time of recession is foolish (just like this 3% mark, BTW). And when several countries do such a politic at the same time it's even worse.
Maybe the 3% rule is a bad rule and should be revised, then again, if it is done away with it, it could lead to countries abusing the "rule" and go on running deficits even when times are good.
Perhaps but the average deficit in the Euro Zone between 2004 and 2007 -ie before the crisis started in 2008- was low (1.5 %), except for Greece. It was significately lower than in the USA, UK and Japan. Focusing on France it reached a 1.8 % low point in 2000 when the GDP growth was strong and 2.5 % in 2006. The public deficit was not really an issue before 2008.
Public deficits are not an issue as long as the GPD growth is strong. France should have reduced public spendings which are indeed high when the growth was strong but I don't think France does worse than other countries in that area (on the graphic : PIB means GDP and DEF means... deficit) : Account balance is a serious problem however. It's no coincidence that the deficit has been deeper and deeper every year since the Euro currency was created. It's sad to say but the Euro is killing the country's industry. And it's the same in other countries except of course Germany and to a lesser extent the Netherlands.
The French insisted on having the Euro, in return for letting Germany re-unite. Not too sure if letting them have a say is for their own good...
Germany wanted euro first, for obvious economic reasons. Kohl exposed the idea to Mitterrand in 1990 and both agreed on it. That would result in the Maastrich Treaty two years later. The irony of the story is that Mitterrand thought the Euro would prevent Germany from being too powerful in Europe because they would depend too much on other countries (he said Euro would "nail the hands of Germany on the table"). Of course, the exact opposite happened.
The French measure the croissant deficit? Y'see, that's TYPICAL of them... concentrating on ALL the wrong things
Right, 'cause protecting the exclusive interest of export-oriented/financial multinational capital* has really done wonders for workers all across the EU, as exemplified by the brilliant economic performances of most Eurozone countries (even those that never incurred in interest rate hikes). * In no way am I suggesting that the Italian government, weren't it for the 'evil Germans', intended to pursue the interest of the Italian working class (the plethora of right-wing pieces of shit we had and still have in charge in the past decade speaks for itself)...just that our politicians didn't have the strength nor the sway to implement the mad, obtuse, anti-social neoliberal policies which gutted the country without receiving 'external' support.
While nobody in Europe really wanted German 'reunification', the truth is that both governments and national capitalistic classes pushed for fixed exchange rates long before the DDR was tragically anschluss-ed by its Western neighbor.
About the Euro issue, a growing number of economists now thinks the best option would be to stop this mess and to get back to national currencies. Unfortunately it will most likely not happen. In France these opinions are best exemplified by Jacques Sapir : http://russeurope.hypotheses.org/1575 http://russeurope.hypotheses.org/1220
No surprise since growth didnt really exist in the French economic model since the days of Jean-Baptiste Colbert. And as if any further proof was needed that they have no clue about economics:
On your first point, France's growth hasn't been particularly worse than Germany's since 1990 (Germany is in blue on the graphic). Germany has had a stronger growth since the mid 00's thanks to Shroeder's non-cooperative policy of low-wages and because of negative effects of Euro on the French economy (as opposed to the positive effects Euro has on the German economy) : Even on a longer period of time France followed the same pattern as other developped countries in terms of growth : Secondly, I bet you think these guys -all of them Nobel Prize winners and eurosceptiks at the same time- have no clue about economics :
lol, Krugman thinks the EU is not united enough, he want the EU to behave more like the United States with more revenue sharing among the countries. (Edit: I also assume that he would want a more powerful central government in Brussels.)
Krugman is not against EU and I don't think any of these Nobel Prize winners are against EU. What they say is that the Euro is a disaster. Some of them clearly wish that some countries -like Spain- abandon the Euro.
After fukcin 5 years of French I cannot even order Pizza and it certainly doesnt help career-wise but I got that joke. Just another export success! Is Agenda2020/SapinIV coming soon? I fear heuteshow will be running out of jokes once things (and people) start working in France....
Yes, we've seen how much a success your internal devaluation export has been in Europe so far : it's killing the Euro-zone market . The best thing that could happen now would be that it kills the Euro currency once and for all. Happy the British, Swedish etc who didn't go into this mess.
I can't tell what's the deal with France or any other European nation other than Germany, but here, the Euro has always been a means towards a political goal, economics be damned. And I have to admit, I too supported it for that reason. Today I see things differently. The Euro is harming everyone while simultaneously contributing towards mutual dislike (hatred would be too strong a word). Originally, the Maastricht criteria were a good idea. Had we stuck to them, it would have caused a massive shake up, but in the mid- to long-term, it would have ensured the future of the Euro. By effectively abandoning it in all but name, the Euro is now more like the Latin Monetary Union and it will end in disaster for exactly the same reasons. Regarding deficits: Budget deficits are indeed a major problem as individual countries can't just inflate their way out as they used to. For example: in 1960, 1DM was roughly equal to 1FF. By 1990, 1DM has gotten you 3FF. So within 30 years, the Franc had to depreciate by 2/3 in order to remain competitive. That door is now closed. The problem is that the attitudes and convictions that formed the foundation for the decisions that led to having to depreciate the currency didn't go away. So either way it has to end in tears. Either the French (in this example) are forced to become like the Germans in which case they'll be unhappy, or the Germans have to pay for the French, in which case the Germans will be unhappy, or something in between in which case everybody will be unhappy and blame the other one. As for current account deficits, they are indeed not problematic by definition. Here the rule of thumb is that as long as the investments of an economy are larger than their current account deficit, they should be ok. If however the investments fall below the deficit you have a problem, especially if it's systemic. In that case, your society is living beyond its means and closing in on a collapse. However, even if investments are larger than the deficit, you're not necessarily safe, as you never know if there's already a bubble at work. For example Spain had massive investments during the 2000s, offsetting their current account deficit. However, those investments mostly went into real estates and as it turned out, a lot of that money was burned. So a current account deficit can only be maintained if the investments of the economy as a whole are larger still and yield a profit, which you can only ever know in hindsight. Here's a good overview over how the Euro countries are doing in that regard: http://www.cep.eu/fileadmin/user_upload/cepDefault-Index/cepAnalysis_cepDefault_Index_2014.pdf
I changed my mind towards euro in the way you describe it. I thought it would benefit to all when it was created but now I see it simply can't work. This said, a mjority of people in France still want to keep it though that number has decreased a lot since a few years. The major mistake was that the euro was created before any kind of 'federal' system -if you see what I mean- was built in Europe : there's no real European budget, the national budgets and fiscal systems remain too different etc. It will take too long to fix that and by the way I don't know if it's even possible because at the end of the day that means Germany will pay for others. Wealthiest places paying for the poorest ones : that's how federal states work. Economist Jacques Sapir estimates that Germany should spend 8-10% of his GDP every year for a dozen of year to reduce the gaps between countries. Of course, Germany can't agree with doing that. By the way, has any monetary union worked in the history ? It seems to me that all of them collapsed at some point. Yes, that's the key issue. When you can't depreciate your currency, the only solution to remain competitive is to make internal devaluation just like Spain and other countries are doing (and even France now), with a high risk of deflation and recession for all. Hence the argument of some heterodox economists like Sapir and others who state that getting back to weaker national currencies would be the less painful and most effective solution for countries like Spain, Italy or France.
Well, there is that one place I believe... begins with an 'A' I think.... Aimureikka?... something like that?! The truth is that ALL currency systems are 'currency unions' in the sense that every part of a country won't be as rich or productive as every OTHER part. The problem is that implies people in the richer areas paying to build up the wealth of the poorer areas until they can compete and contribute and, with people seeing each other as 'foreign' and 'competitors' that becomes politically impossible. What SHOULD happen for a common currency is that the richer countries pay taxes to help the poorer ones develop and only THEN should there be a common currency. Of course, that also means we, (well.... YOU, anyway), can't have countries who are significantly poorer, joining it.