Top Ten Reasons Why America Needs to Care About Greece’s Crisis

July 8, 2012 by

Marcela De Vivo 

Image © robertgourley-photo

It has become well-known that Greece is in a state of economic difficulty. In fact, it is estimated that the government debt is at 125% and steadily rising. However, since Greece is thousands of miles away, why should Americans worry about the complications that Greece is facing regarding their budget? There is no simple answer, as there are numerous reasons that should alarm us about the predicament in Greece. Let’s deliberate the top ten reasons why Americans should not disregard that fact that we may be facing a very serious crisis.

Wall Street

Everything tends to revolve around Wall Street. In fact, since many Americans are becoming worried about the Greek crisis, stocks have started to slip. As time goes on and Greece continues to face hardship, the stock market continues to fall at an alarming rate. Simply put, a large majority of investors are worried about the huge debt that Greece has accumulated and are not investing in stocks.

Contagion

What if this problem spreads to other countries? For example, Spain could be the next likely culprit to be faced with a large budget problem. Americans could be faced with disaster. Europe happens to be one of America’s largest trading partners; therefore, numerous areas of American economics are affected.

Resolution

One of the biggest uncertainties is what will happen if there is not a clear resolution in Greece. Big investors tend to be comforted by the fact that a solution is at hand or that there is an easy fix.  With the Euro Zone lacking a unified political system for the sixteen countries that share common currency, this could become a large and never ending dispute. Read more of this post

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Moving to the Right?: Cameron to Consider Vote on EU

July 2, 2012 by

Francis Pitt 

Image © Nick Atkins Photography

The British Prime Minister, David Cameron has stated that he is prepared to consider a vote on Britain’s relationship with the European Union, adding that an in/out referendum is not what the majority of the British public “most wanted”. Britain’s relationship with its partners across the channel has always been complex and Cameron now wants to add yet another chapter to this book.

Before I carry on, I must clarify my own position on the European Union. I am a passionate supporter of Britain in Europe and studied the European Union for my undergraduate degree. I have also enjoyed studying in Europe as part of the European Union’s Erasmus Exchange Programme. For me, Britain should be integrating further into the union, and not turning its back on our European partners.

Britain’s history with Europe has been on a bumpy road, with Britain acting as the stroppy child sitting in the back seat of the car, constantly asking the drivers (France and Germany) “are we there yet?” When the forerunner of the European Union, the European Coal and Steel Community, was founded, Europe was still recovering from the aftermath of World War Two and Britain refused to join the club.  It was not until 1973 when Britain was finally admitted to the community in its first expansion, along with Denmark and Ireland. But almost from the start, the question of whether the UK should remain in Europe came to the fore when the 1975 referendum on continued membership took place. However, back then the British public was far more pro-European than today, as 67% of the voters backed Britain’s continued membership. The following 37 years have seen Britain refuse to give up the rebate, join the single currency (although this might be a blessing in disguise in hindsight), and have recently decided to use their veto.

Britain has managed to get to this position by constantly dragging their feet over practically every EU decision or treaty. In 2011, Cameron vetoed joining a new European treaty on fiscal discipline, in order to protect the City. The move left Britain more isolated in Europe and even drew criticism from the Archbishop of Canterbury.  Read more of this post

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Master Storytellers

February 1, 2012 by

Seamus Peter Johnstone Macleod

Image © Saul Gordillo

It is argued that Scottish nationalism under the stewardship of the SNP has come of age. Gone are invocations of the spirit of William Wallace or Robert the Bruce. Less frequent too are references to the barbarity of Margaret Thatcher’s rule without mandate. It is said that romanticism has been replaced with a clear-minded pragmatism. The dominant narrative north of the border is that Scotland’s prosperity would be ensured and increased if it were free to pursue its own economic and political goals, free of control from Westminster.

There is much that supports elements of this account.  The SNP succeeded in presenting a convincing case that a pro-Europe, foreign investment friendly, socially conscious, independent Scotland would constitute a cause for monetary celebration. And it’s not all bluster. Mr Salmond’s high profile publicity trips to the Middle East and China, ostensibly securing bilateral trade and investment ties, are backed up by solid figures that show that foreign money has been flowing into Scotland – at a relatively steady rate – since 2002. The SNP’s dream to follow Ireland’s example of prosperity through low corporation tax, a skilled workforce, and modern infrastructure attractive to multinational companies cannot be discounted merely due to the unfortunate end that met that arc of prosperity. SNP ministers are more likely to be found quoting economic statistics than Rabbie Burns these days.

Scott Hill has rightly pointed out that it is the unionist side that now appear to be the champions of sentimentality and myth. Claims that “we are stronger together” sound hollow and are mostly unsupported by the rationality that appears to colour the rhetoric of the SNP. Melanie Philips does her cause no favours by perpetuating the false notion that Scotland receives a sizeable windfall from taxpayers elsewhere in the UK. Though the truth of this matter depends on which year or years of data are considered and what proportion of North Sea oil is considered to be Scotland’s, it is not the case that Scottish citizens would lose significant funds through independence. Equally, the notion that Scotland would have been bankrupted by having to independently bail out RBS during the credit crunch are grounded more in fiction than in fact. Joint bailouts by groups of states did take place during 2008 and this would likely have happened in the case of RBS given its sizeable presence south of the border. Read more of this post

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