Bad news for southern Europe. It seems that coronavirus will further strengthen longstanding differences between north and south.
According to European Commission estimatesThe economies of Italy, Spain and Greece will shrink by 9%. For comparison, the EU average is 7.4%. France will decrease by 8.2%, while most countries of Northern Europe and Germany will decrease by less than 6.5% (these are Germany, Sweden, Denmark, Austria, Finland).
EU unemployment is expected to rise from 6.7% to 9% this year. Unemployment will rise to 9.7% in Portugal, 10.1% in France, 11.8% in Italy, 18.9% in Spain and 19.9% in Greece. Germany will have 4%.
The deficit is rising: from 0.6% of GDP in 2019 to 8.3% this year. Debt will grow to more than 102% of GDP with huge differences: more than 115% for Spain and France, almost 160% for Italy and 200% for Greece. Germany’s debt, on the other hand, will grow to 75% of GDP, and the UK to 102%.
In terms of jobs and debt reduction, all hard-won over the past five years or so have been destroyed.
Nominal GDP per capita (in euros) in selected European countries (source: Eurostat). Italy and Greece never restored the standard of living of the early 2000s. Note the separation of France and Germany from 2010.
Unemployment (%) in selected European countries (source: Eurostat). Southern European countries have never recovered from the 2010 eurozone crisis. Please note that since then, France has been significantly worse than Germany and the UK.
Macroeconomically, France is now actually part of southern Europe. From about 1965 to 2000, France was, uncharacteristically, much richer than Britain. In the 90s, France was about as rich as Germany, which was then overshadowed by the annexation of former communist eastern Germany. Today, without its own currency (as opposed to Britain) and its vast wealth and overly regulated labor market (compared to Germany), it cannot be denied that France is lagging behind.
Even before the COVID recession, southern Europe was hardly on the path to slow debt growth. Now these hopes are completely destroyed.
Economic disparities between north and south of Europe – which have appeared at least since the end of the nineteenth century and especially since the Second World War – going to become deeply rooted.
This is one of the reasons that I am skeptical of short-term or even medium-term racing scenarios in Western Europe. The fact is that the most diverse and, most often, jealously diversified parts of the Western world – Germany, the Netherlands, the countries of Northern Europe, Great Britain, the USA and the former White Dominions, mainly the north-western European and Germanic backgrounds – continue to be more economically dynamic.
Northern Europe and its colonial branches continue to create better economic prosperity – despite being hindered by African, Islamic and Latin American minorities, which constitute economic resistance to indigenous peoples – than the relatively homogeneous countries of Southern Europe and their colonial branches (namely The whitish nations of Argentina and Chile, which have enough Indian blood).
In the 90s and early 2000s, the European Union could still confidently hope that, despite significant inequality, its countries would gradually approach the same standard of living and level of development.
These hopes were supported by Boomer’s special assumptions: wealth grows on trees, and all are equal. When the single euro currency was created in 1999-2002, the European Central Bank stated that the public debt of the countries of Southern Europe is as creditworthy as that of Germany, and investments in them are actually subsidized. German and, especially, French banks took the opportunity to make large investments in southern Europe, which led, in particular, to the hypertrophied public sector in Greece and a huge bubble in the real estate market in Spain. The bubble burst around 2010.
All this has great political consequences. The scale of the economic disaster in southern Europe is probably due to why German Chancellor Angela Merkel agreed doubling the EU budget by 500 billion euros over the next three yearsattracting EU loans to finance transfers to countries affected by coronavirus, especially in southern Europe.
This improvised quasi-federal scheme is unprecedented in terms of speed and scale in EU history. As Jean Quattremer notes, given that the new budget will be financed relatively painlessly lendingEuropean leaders may have strong incentives to resort to such plans again in order to find the ultimate quirk during their endless top-level negotiations.
It is noteworthy that, it seems, the German establishment – apart from the German Constitutional Court – basically agreed with the adoption by the ECB of mass lending in the English style to support the economy. If this goes on forever, it is likely to prevent a 2010-11-style financial panic in southern Europe, but it has conflicting effects on redistribution and inflation in the medium term.
Today, even if you do not take into account highly fertile immigrants, the birth rate in northern Europe seems to be slightly higher than in southern and eastern Europe, I suspect because (potential) parents use excellent childcare / social welfare services and higher / safer income in Northern Europe.
If southern Europe does not recover economically, we can expect to continue extermination of the population as their birth rates remain low, and their more adventurous youth, especially educated ones, are heading north. The financial and political dependence of these countries on the north will increase. The economies of Northern Europe, of course, will benefit from an influx of immigrants from Southern Europe, which partly counteracts the effects of Afro-Islamic immigration.
Politically we have fertile soil for instability. The Macron regime is already barely able to hold on to the more arrogant elements of the (neo) French population – be it white Vests-Jaunes or Afro-Islamic BLM marchers are in awe.
Italy looks on the verge of an explosion. Both the political establishment and the general population are becoming anti-EU. at first Five-Sar populist left-wing movement collapses, Nationalist Lego Matteo Salvini is on the flank. ,, even more nationalistic brothers of Italy.
Imagine that the European-globalist establishment in these countries will now have to cope with this pressure with additional years of mass unemployment and tightening their belts. Italy has great prospects for a decisive transition to the national-populist regime in the coming years and joining the Visegrad ranks. (I am less optimistic for France.)
In the long run, I say 30-40 years, we can expect that Northern Europe will become so dysfunctional that people prefer to live in Southern or Eastern Europe. Non-whites currently make up about 20% of the population of northwestern Europe. When this figure rises to 40 or 50%, we can expect that the situation will indeed become very unstable.
We hope that by then the southern and eastern Europeans will take note of the mistakes of their brothers and begin to take the necessary measures. I mean the adoption of enlightened biopolitics: the preservation of their ethno-national identity (accepting only assimilated immigrants, including compatriots) and a systematic policy that ensures the reproduction of their nations and, moreover, with the aim of improving the genetic and phenotypic quality, European nations will So Unfortunately, in the world by that time we will have no room for new excuses, misconceptions and half measures.