If the latest polls—and the accompanying press coverage—are to be believed, Nicolas Sarkozy's time as president of France will soon come to an end. In the all-important run-off election scheduled for May 6, most believe the incumbent will lose to his Socialist challenger, François Hollande. This is a prospect that no doubt worries Sarkozy and his supporters in France. But it should also worry people elsewhere in Europe, as well as here in the United States. To be sure, Sarkozy’s unmaking has been a long time in coming.
Though the continent's collected prime ministers will no doubt again pledge to do all that's within their powers to preserve the grandeur of the European Union when they meet today in Brussels, the continent's fate ultimately rests on the quiet, technocratic governments of Italy and Greece. Unfortunately, those administrations have since seen their fortunes diverge considerably. It’s worth noting, however, that their respective failures and successes have been entirely predictable (if not entirely preventable.) Take Italy first.
Another month, another EU Summit. And once again, markets are judging the compromise as, at best, incomplete—at worst, disastrously insufficient. On top of everything else, the new agreement has managed to formally isolate Britain from the other 26 EU member states. (British euroskeptics are applauding their country's newfound estrangement, but more considered commentators realize the situation is fraught.) So is Europe ultimately doomed to all that jazz about euro breakup and financial apocalypse? Not quite.
Everything said and done around the World Cup in the last month has seemed right and wrong, spot on and deluded—and often simultaneously. First it was the “African Cup.” The dream was ephemeral, save perhaps for Ghana. Then there was talk about a “new Europe”: forget aging Italy, England, and France, here came the vibrant sons of a united Germany. (Though, it must be said, less and less of them are actually German). Almost as soon as it started, however, it became the “Latin American Cup.” European tactical conservatism seemed doomed against the Latin love for the game.
Europe is burning. The unpronounceable Eyjafjallajökull volcano won’t stay put; Southern European countries are competing with each other to announce the most draconian austerity measures imaginable; a liquidity flood of Biblical proportions has failed to restore market confidence; and, if that weren’t enough, Simon Cowell is getting cold feet about marriage. These are dark days. So what better time for me to flee stern Con-Lib London and seek relief at the Cannes Film Festival? Surely better Penelope Cruz than Premier Cameron. Penelope was too busy to hang out.
Otherwise-obscure central bankers spent an unprecedented amount of time in the global limelight last year. As the crisis brought down not only banking behemoths, but also macroeconomic axioms, the expansionary measures enacted by the Fed’s Ben Bernanke, the European Central Bank’s Jean-Claude Trichet, and the Bank of England’s Mervyn King have been credited, at least for now, with preventing a second coming of the Great Depression.
Less than two months ago, key members of Argentine president Cristina Fernández de Kirchner’s cabinet boasted that the global financial crisis would not affect Argentina. At the Waldorf Astoria in New York on September 25, the president herself reacted bitterly to an American executive who asked about her plans to cope with the looming downturn: “It is you [the US and Europe] who need a Plan B.” They spoke too soon.