An amusing
interpretation of the financial crisis from both sides of the pond, this entry
provides a rather eye-opening truth which has shown the effects of
globalization, especially on the US’s economy. Suffering from a 5 year crisis,
America has limped for the past few years, rolling with the punches of
consumption faltering and perking cyclically as well as investor and business volatility
based on weather, politics, and anything else we can remotely make relation to
in the way the markets dip, inch up, and flat-line. But ever so rarely does the
American media ever look outside of North America and pay attention to the
increasing turmoil of the EU.
In 2009-2010, news of
Greece, Spain, and Italy’s bank troubles briefly ran in the news. Financiers
proceeded cautiously, but little changed, even after Ireland’s banks ran into
trouble later on, on the US’s side. So, what does this say about the US’s
current situation? It only confirms that its financial standing is not built
upon those of the countries which once colonized it. However, unsettling
parallels can be drawn between America and the EU. Talk of EU dissolution and
the reversion back to previous currencies is mirrored in the way that the
states function much like their own countries. It is ever so tempting to pull a
Germany, cut ties, and rebuild internally, but the Federal Government has kept
a strong-hold to prevent such extreme actions.
Another parallel
already brought to the table is the US’s overspending and how Greece got itself
into a fix. If the US continues to push deficits to long-term debts, inflation
or bank failure is bound to be the result.
Now, there is a point
made that I have to disagree with: the US does have stronger mini-economies
which have kept it afloat, but unlike Europe, the regions of highest
GDP-dollar-per-capita are perhaps the most in debt. States such as New York,
New Jersey, Connecticut, Massachusetts, Rhode Island, Oregon, California, and
Washington have seen a shift in their tax basis as their population has fled
for states of lower tax codes (namely the Southeast.) So, the economic
powerhouse has become regions of high production potential (no unions) and low
property tax and minimum wage.
Despite it being an
uphill battle to recovery, at least the exterior European markets will not push
the US to belly-up in the long run.
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