Europe's Citizens

The Lehmann Letter (SM)

  

Today's Wall Street Journal has a number of worthwhile articles on the European financial crisis.

Begin with, “How a Radical Greek Rescue Plan Fell Short,” for a historical description of those events:

http://online.wsj.com/article/SB10001424052702304203604577393964198652568.html?mod=ITP_pageone_0

Greek voters rebelled against their government and austerity in last Sunday's election. The electorate said “Enough; we can't meet Europe's demands."

Europe’s response has been stern: No money without reform. See, “Europe Delays Bailout Payment:”

http://online.wsj.com/article/SB10001424052702304070304577393604233164954.html

Spain, on the other hand, has been working with Europe: Trying to convince Germany to give the leash a little slack. ”Spain to Get Room on Deficit Rules” details how Spain will have a little more time to reduce its budget deficit:

http://online.wsj.com/article/SB10001424052702304543904577394381158093936.html

Finally, "Euro in the Eye of Continental Storm,” provides reasons why the euro has held up well despite all the turmoil:

http://online.wsj.com/article/SB10001424052702304543904577394491110287180.html?mod=ITP_moneyandinvesting_0

But let's not forget that there are voters in Germany as well as Greece and Spain. German citizens are tired of giving, and Chancellor Angela Merkel must give credence to their views if her government is to survive. So there is a tug-of-war going on among Europe's citizens, not just its governments and their leaders. Germans demand austerity because they are tired of paying, while Greeks and Spaniards insist that they need more assistance because they can't live with continued austerity.

These are huge challenges for Europe's leaders and Europe's citizens. Since they have met such challenges before, there is optimism they will meet them again.

(To be fully informed visit http://www.beyourowneconomist.com/)

© 2012 Michael B. Lehmann