The European Project: the future of the EU.

[Kyriakos]

With all the talk about trade in and with the EU and the talk about the surge of China trade (a factor 10 between 2000-2019) here a nice vid showing the amount of export and ranking for the global top 20 for 1948-2019
As small caveat
The Netherlands and Belgium show high trade but lots of that is from re-export of goods that came to the ports. Estimated effect: Netherlands true trade about 50% and Belgium true trade about 70%

Now imagine what happens to those nice german exports when half the Eu (South) has large tarifffs on them

 

[Verbose]

Now imagine what happens to those nice german exports when half the Eu (South) has large tarifffs on them

The south ends up paying more for those things, while using proceeds from those tariffs NOT at making their own production industries more internationally competitive but for gold-plated civil service functionaries retirement plans etc. (i.e. not sensible investment but short-term vote-buying), while borrowing more money from Germany to continue buying BMWs etc., while the Germans double down on making their exports even more competitive – more robots, automation, just-in-time-production – oh, and the Czech and Hungarian autoworkers assembling the cars take a pay-cut also?

That's roughly how it has been happening so far. There are a couple of ways to get out of that kind of trap, but mostly they don't really hinge on blaming the Germans and demanding more money from them.

 

[Kyriakos]

The south ends up paying more for those things, while using proceeds from those tariffs NOT at making their own production industries more internationally competitive but for gold-plated civil service functionaries retirement plans etc. (i.e. not sensible investment but short-term vote-buying), while borrowing more money from Germany to continue buying BMWs etc., while the Germans double down on making their exports even more competitive – more robots, automation, just-in-time-production – oh, and the Czech and Hungarian autoworkers assembling the cars take a pay-cut also?

That's roughly how it has been happening so far. There are a couple of ways to get out of that kind of trap, but mostly they don't really hinge on blaming the Germans and demanding more money from them.

Hey, only money I demanded from germans was those they haven't paid as reparations for WW2, awarded by the victors treaty. Not my issue you support the nazi state getting away with it
And no, that's not how tariffs work. It is a tool to ensure exporters aren't parasitic.

 

[Verbose]

Hey, only money I demanded from germans was those they haven't paid as reparations for WW2, awarded by the victors treaty. Not my issue you support the nazi state getting away with it
And no, that's not how tariffs work. It is a tool to ensure exporters aren't parasitic.

It's a way of putting the fundamental need for structural reforms and investment in southern Europe. (Bad short-terms choices of spending have bad long-term effects.)

But for the record I'm in favour of the Germans giving up their fetishistic attachment to the car industry as its export industry linch-pin, in favour of shrinking the German low-wage sector, social reform and generally allowing the Germans a bit more affluence, meaning among others the southern European economies might claw something back from the Germans that way – let the Germans have a bit more of the good life long enough for others to be able to scratch that work-ethic. If the south demands something like that, it could actually find allies for it in Germany even, for a more sensible structuring of the economy of the EU.

But tariffs by themselves won't do squat for reforms. Nor will just demanding more money off of the Germans.

 

[Kyriakos]

It's a way of putting the fundamental need for structural reforms and investment in southern Europe. (Bad short-terms choices of spending have bad long-term effects.)

But for the record I'm in favour of the Germans giving up their fetishistic attachment to the car industry as its export industry linch-pin, in favour of shrinking the German low-wage sector, social reform and generally allowing the Germans a bit more affluence, meaning among others the southern European economies might claw something back from the Germans that way – let the Germans have a bit more of the good life long enough for others to be able to scratch that work-ethic. If the south demands something like that, it could actually find allies for it in Germany even, for a more sensible structuring of the economy of the EU.

But tariffs by themselves won't do squat for reforms. Nor will just demanding more money off of the Germans.

You seem to have become rather more racist (you do strike me as having expressed a rather racist view about an entire population there, no?) in your time of absence... Everything ok?
There's no german work ethic, they work less (Stannis: fewer) hours than people in the south.

 

[Hrothbern]

Hey, only money I demanded from germans was those they haven't paid as reparations for WW2, awarded by the victors treaty. Not my issue you support the nazi state getting away with it
And no, that's not how tariffs work. It is a tool to ensure exporters aren't parasitic.

After the war, our country in tatters, an estimate was made about the damage amounting to 25 Billion Guilders. Our GDP at that time was only 5 Bilion Guilders.
We got at first nothing and started rebuilding with a national debt of 240% of GDP and most of our industry missing the confiscated machinery, up to our most important means for transport our bicycles.
In the early 60ies we got 1% of the damage paid by Germany. Later there was some money from Switzerland as well. Sweden supplied by the Red Cross some food droppings at the height of the famine winter of 1944-1945.
Atthe end of the 40ies the US helped with the Marshall plan, having about the same financial level during a couple of years as EU funding to the weaker countries over decades by now.

Greece was no doubt economically hit harder by the Nazis because of the destruction damage of buildings, infra etc as well.

The rest of western Europe had much less damage in economy and casualties (as % of GDP and as % of population). Especially the countries who were "neutral". I cannot remember BTW any solidarity from countries like Portugal or Spain, who cry out for solidarity now.
East Europe was hit most. And did they got much help ???

WW2 is water under the bridge by now.

 

[Thorgalaeg]

After the war, our country in tatters, an estimate was made about the damage amounting to 25 Billion Guilders. Our GDP at that time was only 5 Bilion Guilders.
We got at first nothing and started rebuilding with a national debt of 240% of GDP and most of our industry missing the confiscated machinery, up to our most important means for transport our bicycles.
In the early 60ies we got 1% of the damage paid by Germany. Later there was some money from Switzerland as well. Sweden supplied by the Red Cross some food droppings at the height of the famine winter of 1944-1945.
Atthe end of the 40ies the US helped with the Marshall plan, having about the same financial level during a couple of years as EU funding to the weaker countries over decades by now.

Greece was no doubt economically hit harder by the Nazis because of the destruction damage of buildings, infra etc as well.

The rest of western Europe had much less damage in economy and casualties (as % of GDP and as % of population). Especially the countries who were "neutral". I cannot remember BTW any solidarity from countries like Portugal or Spain, who cry out for solidarity now.
East Europe was hit most. And did they got much help ???

WW2 is water under the bridge by now.

So you expected solidarity from Spain which was isolated and segregated from the rest of Europe, completely destroyed by a brutal civil war and privated of any exterior help as the one you received? How? Why? And anyway, was Spain (or Portugal BTW) in any kind of common market along the Netherlands to have any economic or political reason or interest in helping you?

 

[Kyriakos]

So you expected solidarity from Spain which was isolated and segregated from the rest of Europe, completely destroyed by a brutal civil war and privated of any exterior help as the one you received? How? Why? And anyway, was Spain (or Portugal BTW) in any kind of common market along the Netherlands to have any economic or political reason or interest in helping you?

Doesn't their national anthem refer to loyalty to the king of Spain?

 

[Hrothbern]

So you expected solidarity from Spain which was isolated and segregated from the rest of Europe, completely destroyed by a brutal civil war and privated of any exterior help as the one you received? How? Why? And anyway, was Spain (or Portugal BTW) in any kind of common market along the Netherlands to have any economic or political reason or interest in helping you?

How big was the damage of the Civil war in Spain ?

Doesn't their national anthem refer to loyalty to the king of Spain?

We impeached Philips II
At that moment we did not yet revolt against the Spanish Throne.
That came later
Do mind that our anthem is the apology of William the Silent
and when he was murdered ordered by Philips II.. well

 

[Thorgalaeg]

How big was the damage of the Civil war in Spain ?

Pretty huge. Dont have the kind of charts and numbers you like so much, but to make an idea, food rationing lasted until 1952.

 

[Hrothbern]

Pretty huge. Dont have the kind of charts and numbers you like so much, but to make an idea, food rationing lasted until 1952.

I did a serious attempt a long while ago to find numbers on the WW2 damage of European countries.
The numbers on casualties are mostly there with here and there some controversities-rougher estimates. For Spain IIRC also some 10,000 Spanish casualties in France to help the resistance there.
The damage however to the economies is however not readily available on internet and my Spanish language is zero.

Our rationing was stopped in 1950 though put back again in 1956 with the Suez crisis.
But a damage of 500% GDP is really huge Thorgalaeg.
NOTHING was left except outdated equipment or equipment of no use to German factories or equipment best staying in NL to produce there for German demand. All produced food was confiscated by the Germans and we got rations back.
At the end of 1944 400,000 Dutch people were in total working in Germany, deported to Germany first orderly and then with razzia's.
On a population of 9 million, with around 70% of working age you have 35% male workers or around 3 million. That 400.000 was 13% of our workers.

If you look at Covid now:
the financial aid programs will cost our countries something 20-30% of GDP. Add two or three years loss of GDP growth of 2% and you end up at 25%-35% of GDP.
Completely neglectible to the NL WW2 damage.

But if you can find something for Spain I will be happy !
The thing is that because these economical damages are not transparant available our opinion consensus on realities is affected.
Like for example that Greece was devastated by the Germans in WW2 compared to the other south EU countries.
Kir is not a cry-baby when he complains about that imo.

I get very much the impression that some countries do not like to hear the differences and I stated that in my post in a provoking way.

 

[Thorgalaeg]

Spanish civil war ended in 1939, rationing lasted until 1952. Netherlands involvement in WW2 ended in 1945, rationing lasted until 1950. 13 vs 5 years.
That fact only speaks volumes about how different was the economical struggle in both countries. Spaniards had to face the consequences of war alone. In fact there was an economical and diplomatical blockage against Francoist Spain after WW2 which formally lasted until 1955, known here as the age of the Autarchy. Only few countries, like Peron's Argentina dared to commerce with Spain.

About the death toll, the exact number is unknown. Numbers go from 500,000 to a million without counting deaths by hunger and repression in the years after the war.

 

[Hrothbern]

Spanish civil war ended in 1939, rationing lasted until 1952. Netherlands involvement in WW2 ended in 1945, rationing lasted until 1950. 13 vs 5 years.
That fact only speaks volumes about how different was the economical struggle in both countries. Spaniards had to face the consequences of war alone. In fact there was an economical and diplomatical blockage against Francoist Spain after WW2 which formally lasted until 1955, known here as the age of the Autarchy. Only few countries, like Peron's Argentina dared to commerce with Spain.

About the death toll, the exact number is unknown. Numbers go from 500,000 to a million without counting deaths by hunger and repression in the years after the war.

Thanks for the info you gave. That blockade new for me though unsurprising.
Perhaps I give it another attempt to find trustworthy macro numbers.

 

[innonimatu]

The south ends up paying more for those things, while using proceeds from those tariffs NOT at making their own production industries more internationally competitive but for gold-plated civil service functionaries retirement plans etc. (i.e. not sensible investment but short-term vote-buying), while borrowing more money from Germany to continue buying BMWs etc., while the Germans double down on making their exports even more competitive – more robots, automation, just-in-time-production – oh, and the Czech and Hungarian autoworkers assembling the cars take a pay-cut also?

Why, we could solve that by putting especially high tariffs on those BMW from Germany. But keep saying that the dirty southerners are corrupt, that warm feeling you get from it must be really pleasant.
You think Sweden and France are immune from the same financialization and deindustrialization fostered by the EU rules?

 

[Kyriakos]

Turkey boycotts french products
I also like Germany being called fascist, by Turkey. Pretty amazing how much one can pretend to be deaf when they want so much to sell submarines to Turkey for a few euros more.

 

[mitsho]

The south ends up paying more for those things, while using proceeds from those tariffs NOT at making their own production industries more internationally competitive but for gold-plated civil service functionaries retirement plans etc. (i.e. not sensible investment but short-term vote-buying), while borrowing more money from Germany to continue buying BMWs etc., while the Germans double down on making their exports even more competitive – more robots, automation, just-in-time-production – oh, and the Czech and Hungarian autoworkers assembling the cars take a pay-cut also?

That's roughly how it has been happening so far. There are a couple of ways to get out of that kind of trap, but mostly they don't really hinge on blaming the Germans and demanding more money from them.

I agree with everything but the word „gold-plated“ in there. You do only refer to the civil service functionaries retirement plans, but I do get the current that it is the general level of social services that are „too much“ in the Southern Nations. And I just don‘t get that. I rather think the services are too low in Germany, not too high in Greece. It‘s natural that the civil service will get higher rates as that is the place where the government or the parliament can most easily and quickly change things. That is a problem, but I still don‘t think that makes them gold-plated, that just makes them decent at first. We are a rich continent, we should be able to provide a better social security for our poor - that compassion in the end is what makes the Unique Selling Point of Europe. And introducing tariffs between European countries is certainly not the way to go to increase that strength. Rather, it requires further integration of the Social Security of Europe and that means transfers of money in the end.

Maybe I went off a bit on a tangent here, and I know my connection point of „gold-plated“ is tenuous at best, but again, I do feel like there‘s a whole ideology and populism that swings with it.

 

[Hrothbern]

but I do get the current that it is the general level of social services that are „too much“ in the Southern Nations.

General opinion, general current here in NL by most people, civil society and most political elites is not that social services in the South are at a too high level.
It is best summarised by that the current is that South civil services are not effective from needing more civil servants from overcomplex regulations and causing slower response times to citizens without effectively reaching out with resources to the people most in need.
More in centre right and right in NL, but also among traditional social democrats etc, there is the current that labor mobility is clogged from election voting driven bad incentives. And yes... to be excuted by civil servants. In effect that the south countries do not generate enough jobs and have not enough incentives for productivity increases.

What does hurt as well but most people do not know is that in south countries the average income of civil servants is higher compared to other EU countries.
But the experts in other EU countries, in Brussels AND the south countries do know.

Here a graph on that from an article that makes some analyses on civil servants
https://www.europeandatajournalism....sons-between-European-countries-are-deceptive

As you can see the correlation between the rate and north-south is very high.

 

[Verbose]

I agree with everything but the word „gold-plated“ in there. You do only refer to the civil service functionaries retirement plans, but I do get the current that it is the general level of social services that are „too much“ in the Southern Nations. And I just don‘t get that. I rather think the services are too low in Germany, not too high in Greece. It‘s natural that the civil service will get higher rates as that is the place where the government or the parliament can most easily and quickly change things. That is a problem, but I still don‘t think that makes them gold-plated, that just makes them decent at first. We are a rich continent, we should be able to provide a better social security for our poor - that compassion in the end is what makes the Unique Selling Point of Europe. And introducing tariffs between European countries is certainly not the way to go to increase that strength. Rather, it requires further integration of the Social Security of Europe and that means transfers of money in the end.

Maybe I went off a bit on a tangent here, and I know my connection point of „gold-plated“ is tenuous at best, but again, I do feel like there‘s a whole ideology and populism that swings with it.

Yeah sure, "gold plated" was clearly rhetorical hyperbole – but then again in a way the entire post had a rhetorical bend.

The general point is that the EU needs to come together quite a lot better than it currently does – and not primarily in protestation of sympathy between various constituent part – but very practically in how the "north" needs to become more like the "south", and vice versa.

And if a bona fide transfer union needs be for that, then one is going to be needed. But then a functioning transfer union will bring other measures of accountability and control to bear on individual member states. And how THAT plays out will likely make of break things.

 

[mitsho]

True. so very true. (I really have nothing to add but that)

 

[Hrothbern]

but very practically in how the "north" needs to become more like the "south", and vice versa.

That sounds symphatic

But should the north increase salaries of civil servants with 40% ?
Should the north decrease its level of social securities ?
Should the north complicate regulations ?

Transferring (more) money is the catch all and in reality (I think) the only practical action that is acceptable at public level