Tuesday, July 24, 2012

Italy Wants a Signal

As I said in a previous post, the euro crisis is coming to a head. Italy wants a "signal" from "Europe" that it will stand by commitments made at the recent summit.

ROMA - Per Corrado Passera non c'è più tempo. "Un segnale lo deve dare l'Europa. Ed è ora che lo dia". Sia per tranquillizare i mercati che per raffreddare lo spread. Così il ministro per lo Sviluppo Economico, a margine di un'audizione sulle ecomafie, ha risposto ai giornalisti che gli chiedevano un commento sull'attuale situazione economica dell'eurozona.
But who speaks for "Europe"? And what sort of signal will it take to calm the markets this time? La Repubblica seems to think that "Parigi" is standing with Italy:
Parigi, Roma e Madrid: "Attuare impegni"

But "Parigi" is speaking softly, if at all, and not carrying a very big stick, as far as I can see.

UPDATE: See Trisha Craig's comment on the regional contribution to the woes of Italy and Spain.

Response to Commenters

Some comments on a previous thread concerning Hollande's speech at the Vel' d'Hiv' prompted this response from me, which I think is worth posting here, where it will be more visible:

Yes, Roosevelt loathed de Gaulle, because in his eyes de Gaulle was a fantasist who took himself to be "France." A bit like Joan of Arc hearing voices, or an asylum inmate imagining that he is Napoleon. And you can see the thing from Roosevelt's point of view. In one discussion, Roosevelt and Churchill were laying plans for a major operation, talking about deployments of troops, fleets, airplanes. De Gaulle piped up: "France will contribute 1,000," he said. Roosevelt wondered, "One thousand what? Tanks? Divisions? Ships?" So he put the question to de Gaulle. The answer: "One thousand men." To a leader thinking in terms of hundreds of thousands of troops, this may well have seemed ... risible.

But Roosevelt underestimated the importance of symbolism, which was de Gaulle's forte, and when circumstances are right, symbolism can turn into real force. It has been estimated that the French Resistance was worth several divisions to the Allies. But all this is quite irrelevant to Hollande's apology. Unlike Boris, I find the Franco-Israeli historian's contribution quite small-minded. True, de Gaulle and the Resistance did not have the fate of French Jewry in mind (nor did Roosevelt, for that matter). But it's quite right of Hollande, who is the leader of all the French, not just French Jewry, to recall, while apologizing for France's failings, that de Gaulle and the Resistance did save France's honor by refusing to capitulate. What made Hollande's speech so splendid was that he didn't feel the need to choose: either I am a Gaullist or I am a defender of the Jews. No: he said forthrightly that one can speak of the Jews and still pay homage to de Gaulle. I wish that Henri Guaino, now joined by Bruno Le Maire, who really should know better, understood this.

(I will have to rethink my previous praise for Le Maire. Both his interview with Mediapart and his statement on the Hollande speech were extremely disappointing. I gave him credit for more intelligence.)

Greece Is On Its Way Out ...

I'm not normally a betting man (although I do invest in the casino known as the financial markets, which may be a crazier thing to do than putting on a tux and heading for Monte Carlo), but I'm willing to give odds that Germany has decided to let Greece go. I know that the FDP doesn't speak for Germany, but here is what the party's secretary-general said:
"Athen ist bei der Euro-Rettung zum Hemmschuh geworden. Die mangelnden Fortschritte Griechenlands bei allen Reformen, Sparvorhaben und Privatisierungen führen dazu, dass die Finanzmärkte die immensen Anstrengungen in anderen europäischen Ländern nicht ausreichend würdigen", beklagte Döring nun.
"Athens has become an impediment to saving the euro." You can't put it any more bluntly than that. Making an example of Greece didn't prevent contagion to Spain and Italy, which was the real purpose of putting the screws to Greece, so why bother pouring more money into that bottomless pit? So say Germany's archest neoliberals. So it's on to plan B, or is it plan W--I've lost count.

Hollande has thus far been quiet, but with Germany now on negative watch by the ratings agencies, it's clear that Europe must try something new. If the Germans jettison Greece, there's not much France can do to stop them--if it even wants to. But the growing danger is that Germany may decide that it's had enough of the euro altogether. It may persuade itself that it conceded too much to France in the construction of the euro, not to say the EU, and decide to go it alone, or propose a new currency union excluding the troubled economies. I think the endgame has begun, and France will not be able to remain silent much longer.

La Bise, or France Comes to America

After freedom fries, French kissing in the land of the free and home of the brave, armed to the hilt? The French are amused.