Growth and Stability More Debt At G8 Summit
The word of the day is now “Growth“.
At his G8 Summit in Camp David yesterday, the tone was set with a frosty greeting between Obama and German Chancellor, Angela Merkel. And rightly so. On Friday, Obama exuberantly welcomed his fellow Socialist at heart, French President Hollande, to the White House for a pre-Summit visit. During their meeting, they established a kindred commitment to pulling Europe out of its fiscal chaos through more stimulus spending and rejecting the current EU agreement of “austerity”. Even though the U.S. and France’s economies are plunging deeper into debt, while Germany’s economy is growing itself out of it. But Socialists live in the land of make believe where reality is what they wish it to be…and other people pay for it.
According to Reuters,
There are weeks in the political life of Angela Merkel that were surely more pleasant than the last one. …
On Saturday, she looked isolated with her insistence on fiscal austerity – also known as “consolidation” -for the ailing euro zone at the G8 summit hosted by President Barack Obama at Camp David in Maryland.
And she might have been upstaged by the new man at the top table, French President Francois Hollande, who defeated her close ally, Nicholas Sarkozy, just weeks ago and ended the so-called “Merkozy” era in Europe. …
Pundits may view this week as the first chapter of decline not only for the mightiest woman in Europe, but also for the German way of managing Europe’s debt crisis in recent years.
A grand coalition of leaders including President Barack Obama, Hollande, Italy’s Mario Monti and Spain’s Mariano Rajoy want to press her into a more flexible approach to buttress Spanish banks, tackle the Italian deficit and save a rapidly crumbling Greece.
But Merkel and her allies have quite a different view. The stress on “growth” as well as spending restraint is something she has been pushing for weeks, they say. Ultimately, cold fiscal realities could bring Hollande and his allies back down to earth.
“It is a great success, that all agree now that we should have both growth and fiscal consolidation”, Merkel stressed on Saturday with a look of satisfaction. …
The chancellor fiercely denies being isolated around the table of leaders at the U.S. presidential retreat.
She did get an endorsement from British Prime Minister David Cameron, and other leaders praised her emphasis on fiscal rectitude.
“I think the German chancellor is absolutely right that every country needs to have in place strong plans for dealing with their deficits,” Cameron told the BBC. “Growth and austerity aren’t alternatives. You need a deficit reduction plan in order to get growth.” …
Hollande told reporters he “didn’t feel” Merkel was isolated. But her name was conspicuously absent when he said: “It’s true that growth was widely discussed and desired not just by myself, President Obama, but others like Mario Monti.”
Since the chancellor noticed her policy approach was increasingly attacked domestically and abroad as a cold “austerity policy,” she has chosen to use the words “growth” and “employment” much more often in public. She also stresses that it was she who pressed the EU-partners in 2011 to adopt a “euro plus pact” on competitiveness and growth.
But the harsh public reaction only changes the wording, not so much the policy.
One reason is that Merkel has got something most of the critics don’t have – a successful economic model. Germany boasts strong economic growth that has mounting weight in the European Union and an industrial sector now exporting more to countries outside the euro zone than to those within.
So, all policies are called “Growth” policies now. The question is, “what are they growing”? Germany is growing a stable and strong economy. The rest of the Socialists in Europe are growing debt, greater fiscal chaos, and impending doom. Of course, Obama is pushing for the latter. He’s learned nothing from his disastrous Stimulus that piled $800 Billion onto our deficit without adding the jobs and growth he promised.