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someone has really screwed up the european economy.....

The EU is having a full-blown existential crisis. Someone has really screwed up its economy, and the culprit is conspicuously absent from a new report outlining the carnage. Are there no mirrors in Brussels?

 

Has the EU suddenly realized how much it has screwed itself over?
Mario Draghi’s ‘competitiveness report’ says the bloc’s economic situation is dire… but shies away from pointing out the culprit

BY Rachel Marsden

 

Former European Central Bank president and Italian prime minister, Mario Draghi, has published a new “economic competitiveness” report after a year of work at the request of unelected ‘Queen’ Ursula von der Leyen’s ‘Royal’ European Commission. And it’s a real page-turner, one of the great mysteries of our times.  

One is left to breathlessly leaf through the 400-page document looking for a culprit responsible for the massive amount of economic carnage detailed by Draghi. “For the first time since the Cold War we must genuinely fear for our self-preservation,” he told reporters in Brussels. How about starting off by not actively self-sabotaging?

Draghi said that the bloc desperately needs to keep up with China and the US, but has been failing. Perhaps it has something to do with the fact that the EU readily jumped in to ride shotgun alongside Uncle Sam along regime change highway, but now finds itself kicking dirt on the roadside and wanting to make its own way. 

“Now conditions have changed,” Draghi said. “World trade is slowing. China is actually slowing very much, but it’s become much less open to us, and actually it’s competing with us in global markets on all accounts. We’ve lost our main supplier of cheap energy, Russia. And now we have to start for our defense again for the first time since the Second World War.” Apparently, the jokers ruling Europe from the big top tent in Brussels are shocked to discover that they’ve been victimized. Who could possibly have done such a thing? 

Gotta love the use of the passive there. “Lost” their cheap energy from Russia. Like it just fell out of their pocket like a set of house keys on the way back from the store. 

Listening to Draghi, you’d also think that the EU hasn’t actually adopted “de-coupling” from China as a strategy, egged on by Washington, which wanted Europe all to itself, before EU officials rebranded it a “de-risking” when they realized how stupid a move it would be to fully alienate China as the bloc’s top trading partner and customer. 

And now, oh gee, the EU has to start thinking about its own defense again, Draghi said, rather than just using it to shake free some natural resources from all the places with fortuitously-located terrorist problems. 

The Ukraine conflict has been an equally convenient excuse to make more weapons at taxpayer expense for the EU’s own defense after emptying out the old junk from its closets. Good thing, too, because making more weapons is about the only real easy answer for improving the economy right now, judging by the dire state of things outlined in this new report. Still, the EU can’t even do the military-industrial racket right. 

Draghi has pointed out that EU members are basically idiots for buying most of their weapons abroad, with nearly two-thirds coming from the US. Big mystery as to why Washington wants to keep the party going in Ukraine when it’s making bank by drumming up the need to ramp up weapons purchases for EU members under the guise that their former top economic lifeline and energy supplier (Russia) was suddenly a big threat to them. The bonus: making Europe more dependent on the US for pricier gas, too. 

The whole report is just loaded with gems, like this one: “If Europe cannot become more productive, we will be forced to choose. We will not be able to become, at once, a leader in new technologies, a beacon of climate responsibility and an independent player on the world stage. We will not be able to finance our social model. We will have to scale back some, if not all, of our ambitions. This is an existential challenge...” 

Draghi’s going on about all these grand ambitions like leading new tech and being a climate and social icon, while European elites have been yelling at the plebs to turn down the heating and air conditioning to stick it to Putin and cheering mild winters like we’re living in the dark ages. Draghi also said that the EU needs another €800 billion ($890 billion), which is about 4.5% of the entire bloc’s GDP, just to be able to stay globally competitive. And that competitiveness can only be achieved by thoroughly unscrewing everything they screwed up over the past two and a half years through self-inflicted idiocy in the interests of impressing their girlfriend Vladimir Zelensky (aka president of Ukraine). 

Draghi also said that the amount of cash needed to make the EU competitive now is so massive that private investment just won’t cut it. And well, you know what that means. In related news, EU taxpayers, there’s a sale right now on Amazon France for €4 tubes of lube. 

But what if EU taxpayers don’t want to comply, because they’ve had enough of paying for all these screwups, as recent elections across the EU suggest, with anti-establishment parties surging. Well, here’s Draghi with a plea. Cue the violins: “Why do we care so much about growing. Yes, we have to finance these needs, and these needs are important, but why are they so important? Well, they are important because they have to do with our founding values, prosperity, equity, peace and democracy in a sustainable world. And the EU exists to ensure Europeans that they actually will benefit from these fundamental rights. And if Europe can no longer provide them to its people, it will have lost its reason for being.”

Okay, put the lube on ice, folks – he’s giving seduction a try. Queen Ursula will no doubt be along shortly to play the “bad cop.”

So basically, the EU’s ‘braintrust’ blew a bunch of cash and deregulated the economy “for Ukraine”, but now they need Europeans to be okay with handing over even more cash, because it’s totally for their own good. This time it’ll work out. Promise. Just like it did with that ex who you let crawl back into your life one too many times. 

Meanwhile, von der Leyen is talking about the need for economic supply security and Draghi is saying that the EU needs more friends. Ones that happen to have a ton of resources that they can cozy up to, preferably. And he’s also saying that some countries are already trying to do that on their own, but it would be better if the EU took charge of it. Draghi added that the bloc was “punching under our power.” 

More like it’s been punching itself right in the face, over and over again, if the EU’s recent policies and performance are any indication. 

 

https://www.rt.com/news/603975-eu-mario-draghi-report/

 

YOURDEMOCRACY.NET RECORDS HISTORY AS IT SHOULD BE — NOT AS THE WESTERN MEDIA WRONGLY REPORTS IT.

 

no more tourists...

 

EU report shows Ukraine conflict damaging bloc’s tourism
The loss of Russian tourists has hit Finland and Cyprus especially hard, a European Travel Commission study suggests

 

The conflict between Moscow and Kiev has severely affected EU tourism in a market that was recovering from the Covid-19 slump, a major report shows. 

The loss of Russian and Ukrainian tourists, a drop in consumer confidence, and increased travel costs, all stemming from the conflict, have severely hit some of the bloc’s tourist destinations, according to a major European Travel Commission (ETC) study published in September.

Prior to the outbreak of the Ukraine conflict in February 2022, Russian and Ukrainian outbound tourism accounted for 3% ($14 billion) of global spending in the industry, the study says. In Europe, Russian tourists made up 10-20% of incoming business in neighboring countries such as Latvia, Lithuania, Estonia, Finland, and Moldova, as well as coastal destinations like Türkiye, Montenegro, and Cyprus.

Cyprus, the report notes, has suffered especially, losing nine-tenths of its Russian tourists – its second biggest market – and entirely losing the Ukrainian market. Finland lost its biggest tourist market in Russian tourists, causing “extreme difficulties for businesses, especially in the eastern part of the country,” the report says. Bulgaria similarly lost two of its priority markets, Russian and Ukrainian tourists.

The wider impact of the conflict was felt in slower economic growth, higher inflation, interest rates, higher oil prices, and the resulting hike in transportation costs, the report suggests. This was accompanied by lower demand for Europe as a travel destination due to the area being perceived as unsafe, especially for US and Canadian tourists, it adds.

Prior to the Ukraine conflict and the Covid-19 pandemic and subsequent travel limitations, Europe was the most popular tourism destination for Russians, official statistics show. Finland and Estonia were the most popular EU destinations for Russians in 2019, followed by Germany, Italy, and Poland, according to outbound border crossing statistics from the Federal Security Service (FSB), as quoted by the media. 

Russians have traveled to Europe 13 times less in the first half of 2024 than in a similar period in 2019, recent FSB statistics suggest.

These statistics do not only include tourist trips, and do not include Russians arriving via other countries.

READ MORE: Germany to monitor visa applicants’ social media – UK watchdog

After the Ukraine conflict began, the European Council fully suspended the Visa Facilitation Agreement it had with Russia. This complicated the visa application process for Russians and made it more expensive. Some European states have stopped giving tourist visas to Russians entirely.

https://www.rt.com/news/604457-ukraine-conflict-damaging-eurotourism/

 

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YOURDEMOCRACY.NET RECORDS HISTORY AS IT SHOULD BE — NOT AS THE WESTERN MEDIA WRONGLY REPORTS IT.

 

MEANWHILE:

https://www.rt.com/russia/599742-russian-tourists-china-surge-turkiye/

Russian tourism to China surging – data

brics vs g7.....

BREAKING! West In SHOCK As IMF Reveals BRICS GDP Just Surpassed G7!

https://www.youtube.com/watch?v=F6JgYOyrLvg

 

In this breaking video, we delve into the recent shocking revelation by the IMF that the combined GDP of BRICS nations has surpassed that of the G7 countries. The implications of this significant shift in global economic power are profound and far-reaching. Join us as we analyze and discuss the potential impact of this monumental development on the world stage. Don't miss out on this essential update!

 

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YOURDEMOCRACY.NET RECORDS HISTORY AS IT SHOULD BE — NOT AS THE WESTERN MEDIA WRONGLY REPORTS IT.

EU elite's economy.....

 

BY Phil Mullan

 

The European Union’s proposed solution to its economic struggles? More centralisation. More interventionism from Brussels. More EU, in other words.

That is the key message from Mario Draghi’s report on the future of European competitiveness, published last month. It may present itself as a sober economic analysis, complete with proposed policy solutions. But this report – commissioned by the EU and produced by a former head of the European Central Bank – is best understood as a political manifesto for an ever closer EU, controlled from Brussels.

Indeed, Draghi contends that the EU’s economic difficulties stem from what he calls too much ‘fragmentation’ along national lines. He even attributes the cumbersome nature of EU regulations to their ‘national fragmentation’. This, he writes, has led to inconsistencies and differences in how rules like the ‘commendable’ General Data Protection Regulation (GDPR) are applied. ‘The ultimate goal’, he states, ‘should be to make EU and national regulation a consistent single corpus’, formulated by the European Commission.

Draghi consistently blames the EU’s economic and political problems on the difficulty of reconciling differing national views and interests. For him, at least, the answer is obvious: more EU. ‘We must take a new stance towards [members’] cooperation’, he writes, by ‘removing obstacles, harmonising rules and laws, and coordinating policies’.

‘Coordinating policies’ here clearly does not mean co-operation. It means Brussels’ top-down control of Europe. That is why Drahgi’s report is chiefly concerned with ‘strengthening governance’ – a euphemism for the extension of the European Commission’s power. Stronger governance, he writes, ‘means “more Europe” where it really matters’. And this means less national sovereignty where it really matters, too.

The report’s economic analysis, such as it is, serves as a justification for the EU’s key objective – namely, the further political centralisation of Europe. Draghi argues that the EU needs to implement interventionist economic and industrial policies in order to compete with the US and China, and that these would be best undertaken on a Europe-wide scale by Brussels.

To come to this conclusion, Draghi rehearses a familiar economic narrative. Until the turn of the millennium, Europe’s economies were generally doing okay, he claims. Since then, though, Europe has fallen way behind the US and, more recently, China, which is described as a ‘geopolitical rival’.

He also reiterates the now standard suggestion that to rescue its economies, Europe needs to emulate the US and adopt the sort of industrial policies introduced by the Biden administration. This means pouring hundreds of billions of euros into ‘forward-looking’ sectors, like green energy, semiconductors and storage batteries.

Each part of this narrative is flawed. Firstly, the contrast between US dynamism and European sluggishness is overstated. Anyone can cherry-pick economic data from the US that look better than Europe’s, but that doesn’t tell us much about their relative economic dynamism. What we have seen in recent years, rather, is America’s greater economic resilience to recent global shocks, from the financial crisis to Covid to the war in Ukraine. This partly derives from its strongest asset – the continuing global role of the dollar. This helps maintain demand for US Treasury bonds, thereby facilitating federal borrowing and enabling the extraordinarily loose budget policies we’ve seen under presidents Obama, Trump and now Biden. For example, this year’s US budget deficit is expected to be about six per cent, double that across the EU.

This unusually high level of Washington spending, not least during and after the pandemic lockdowns, keeps the American economy active. But it has not prevented the decline in American productivity growth. Even with its high levels of public spending, and its huge fossil-fuel resources, the US is suffering from similar problems to Europe. Workers’ incomes have stagnated, the quality of jobs remains poor and infrastructure is crumbling.

Moreover, Draghi is sometimes a little economical with the truth to establish his thesis – that Europe needs similar levels of investment to the US, controlled centrally by Brussels.

To illustrate the gap in overall productive investment between the two economies, Draghi’s researchers exclude Ireland from the EU data – presumably because of Ireland’s high investment rates since 2015 – and selectively exclude investment in housing from their measure of overall investment. This partial comparison with the US helpfully generates what looks like an annual investment shortfall as a share of GDP for the ‘EU (without Ireland)’ in the years following the financial crisis.

However, if Draghi had simply compared the EU with the US over this period for all gross investment (gross fixed capital formation), then it would have shown the US lagging behind Europe. From 2009 to 2022, gross investment averaged 21 per cent across the EU versus 20.3 per cent in the US.

Draghi doesn’t let inconvenient data get in the way of his argument. Instead, his team were able to finesse the statistics to justify his demands for more US-style intervention and more EU control.

In fact, going back to the start of the 21st century, there isn’t much difference at all between the equally disappointing records of both Europe and the US when it comes to productivity growth. A comparison of the decade before the 2008 financial crash (2000-2007) and the one after (2011-2019) is revealing, and directly contradicts Draghi’s claims about the US’s superior performance. It shows that US productivity growth fell by slightly more than Europe’s did in the decade following the financial crisis.

Secondly, these drops in productivity growth have been accompanied by a broadly common set of economic policies. On both sides of the Atlantic, governments imposed easier monetary policies, similar regimes of business subsidies and had similar recourse to protectionist trade measures.

Thirdly, this transatlantic policy alignment points to what has actually become the biggest obstacle to the US and the EU escaping their productivity slumps. The underlying source of Europe’s economic plight, like those of other mature economies, has been the gradual seizing up of its productive mechanisms since the 1970s. This ‘seizing up’ is shown by the reduced churn or turnover in businesses and jobs. Over the past few decades, company exit-and-entry rates have slowed, industry concentration levels have risen and both job creation and destruction have trended downward.

This contrasts to historical periods of economic crisis when business churn would tend to rise as the less efficient companies went bankrupt, allowing workers and resources to move into more productive sectors and companies. This churn would have the beneficial outcome of higher average productivity levels. Now, we have more rigid and inflexible business structures, where most of the unprofitable firms manage to keep afloat. This clogs up resources and tends to lead to the freezing of productivity levels.

Draghi himself recognises this problem. ‘Europe is stuck in a static industrial structure’, he writes, ‘with few new companies rising up to disrupt existing industries or develop new growth engines’. Yet while this is true, Draghi fails to drill down into the reasons why this has been happening. This is likely because the ‘reasons why’ would contradict his argument for heftier state activism.

For almost four decades, novel fiscal, monetary, procurement and regulatory policies have all tended to prop up existing business, whether they are productive or not. This ongoing attempt to support the economic and corporate status quo has not been a purposeful strategy. Rather it’s been the semi-conscious product of a culture dominant within European and other Western elites. A culture fearful of change and prone to micromanagement. A culture with no grand visions, no trust in people, and no confidence that genuine change could make things better. As a result, policymakers across the West have sought to avoid any unnecessary risks and disruption, and have tried instead to preserve what exists, at all costs.

In Brussels in particular, this apprehensive, safety-first approach has found favour in place of the traditional ‘creative destruction’ that usually characterises capitalism. The huge downside of this protective, safety-led state intervention is that by preventing many businesses from collapsing, it robs the market system of its periodic bouts of cleansing, when unproductive businesses and debt would get wiped out. In the absence of any cleansing, we have economies dominated by large slow-moving, state-dependent corporations. These exist alongside an assortment of zombie businesses – corporate deadwood, kept alive because of state-backed largesse, and with a limited capacity to invest in technology. Hence, the weakness of innovation and the sluggishness of productivity growth.

Most of the Draghi report’s proposals reflect this cultural disposition to support the status quo. Yet throwing enormous amounts of money at a stagnant economy doesn’t kick-start innovation. As we’ve seen in America, it mostly helps bigger businesses expand their operations and defend their market position. Intentional or not, this acts to buttress the incumbent corporations. Outwardly they can appear stable, but internally they can be pretty fragile, as is well illustrated by the current troubles at Volkswagen, or Danish wind-farm firm, Oersted.

To hasten productivity growth, what European economies really need is a twin approach aimed at transforming this damaging economic culture. In short, we need to get government out of business matters, and businesses out of government responsibilities. Instead, what we get from Draghi is a 400-page tract for more intrusion by the Brussels bureaucracy in the affairs of both businesses and national European governments.

This article is based on an introduction given at the conference, Unshackling Europe’s Economy: What Holds Us Back?, held in Brussels on 24 September 2024, organised by MCC Brussels.

Phil Mullan’s Beyond Confrontation: Globalists, Nationalists and Their Discontents is published by Emerald Publishing. Order it from Amazon (UK).

https://www.spiked-online.com/2024/10/02/more-eu-wont-save-europes-economy/

 

 

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