Spanish protesters who evidently aren’t reading the Washington Post. (Photo: Reuters)
With an unemployment rate at just over 26 percent and regular street protests against government austerity policies, it’s hard to imagine anyone holding up Spain as a model.
But here’s Howard Schneider, writing in the Washington Post (1/16/13), doing just that–warning France (unemployment rate: 9 percent) that it had better shape up and be more like Spain:
As France’s socialist government raised taxes on the wealthy and threatened to nationalize a steel plant last year, neighboring Spain reveled in the news that exports were rising and several auto plants would be expanded by their owners.
It was a small sign of what could become a defining trend in the euro zone. The most troubled nations, including Spain, have slashed wage costs and overhauled labor and social rules in an effort to become more competitive.
So France is talking about nationalizing a steel plant and raising taxes on millionaires–the wrong way to do it, evidently. Spain is on the right track–becoming more “competitive” by slashing “wage costs”–otherwise known as how much workers get paid.
As Schneider writes:
There is mounting pressure on France to do the same–or risk falling behind in Europe’s struggle for economic revival. The government of new President Francois Hollande has veered between promises of reform and sometimes fiery attacks on corporate interests and the rich, a fact that has worried public officials in Washington and elsewhere about the direction of the euro zone’s second-largest economy.
See how ‘competitive’ Spain is? (TradingEconomics.com)
The assumption here is that Spain’s harsh “medicine” is working. The only problem for the Post is that they can’t seem to find any evidence to that effect–the anecdote about auto plants expanding is all you get. After just barely beginning to recover from the devastating 2008 economic crisis, Spain’s GDP has been contracting for the past year. But the Post is focused on things in France that have “worried public officials in Washington and elsewhere”–like “attacks” on the rich.
The article is a crystal clear example of how corporate media cover the economy, when the facts don’t matter as much as what are consider to be the “right” policies–and media have decided, against all available evidence, that austerity is the right answer for what ails Europe.
As Schneider puts it:
As neighboring countries retool their labor laws, trim social benefits and overhaul Europe’s social contract, they may be forming a new baseline France will have to match.
In other words: “Hey–there’s a race to the bottom. Hurry up or someone else will beat you to it!”
Mark Twain said
“Never let the facts get in the way of a good story.”
Or pimping a very bad deal for working folks.
There is nothing *fair* about your article, and the assumptions that you are making – ie. the current numbers are a sign that france is doing the *right thing* and spain is doing the *wrong thing* Such simplistic thinking is where the danger lies. As we shall see moving forward, France’s numbers are going to get much worse, because the country is simply too impoverished to sustain its welfare system. Indeed, the only way in which it was able to sustain it was by going steadily into debt for the last 30 years, making its economy increasingly sicker, and now the time to pay the piper is fast approaching for France.
The simple fact of the matter is, most countries in the first world have been living way beyond their means for decades – the governments kept going into debt as the politicians kept *buying the votes* of the people by promising goodies (entitlement programs, stronger military etc.) all the while destroying the future of these countries with crushing debt. The era of Sovereign Debt Crisis is fast coming upon us, even as the governments of the world race to monetize debt and devalue their currency in order to “stimulate” their economy out of ongoing world wide depression.
“the current numbers are a sign that france is doing the *right thing* and spain is doing the *wrong thing* ”
There is no claim being made in the article of what IS the right thing to do, only the critique of the presumption that is out there; stick it to wage-earners barely getting by, don’t you dare touch the wealthy.
And Mister Levine, where are these facts that you point to?
Please show us an example since you insist that you know everything about the world and how it should run. I am sure that if everything is “so wrong”, you should no problem showing hard evidence, and not your pitiful corporate re-tweet of the same garbage that has not helped anyone yet.
I suppose you’ll try and tell us next that really Argentina’s in big trouble because they don’t embrace the austerity where the corporation gets the lions share of the money and materials and the population gets the golden shower; if so spare us the trouble and go back to the Right wing Journals and maintain your trollezn-ship there.
Hey JAMES LEVINE – PUT UP OR SHUT UP. There is NO EVIDENCE AT ALL showing that “Austerity” policies “work” (work for who?). THERE IS NO EVIDENCE AT ALL that austerity should be inflicted more harshly on the French (or American) people. Thats what this artticle is saying. I understand that you dont like seeing that pointed out, but SIMPLY REITERATING DISPROVEN AND INVALID TALKING POINTS DOES NOT FURTHER YOUR FRAUDEULENT WHOLLY IDEALOGICAL “ARGUMENT”. I know that wont stop you and your ilk from repeating your lies in public ad nauseum, because so many of the ignorant simply need to be told someting enough times before they believe its true, no MATTER HOW DEMONSTRABLY, PROVEABLY FALSE.