Ally the emerg­ing tox­i­c­ity in its pol­i­tics

The East African - - OUTLOOK -

l in­surance against ak coun­tries. hese sta­bilis­ers. It also obil­ity: If one state exn, its work­ers can go out fac­ing lin­guis­tic is stuck in the mid­dle ntries of the euro zone bank but mul­ti­ple -in­surance schemes. ing goes, the only he mid­dle of the road ists have pro­posed the mon­e­tary union. st a po­lit­i­cal fact: Rich h don’t want to un­der­ones on the pe­riphrd as ir­re­spon­si­ble. pulist na­tion­al­ism has deep­ened the north­ern­ers’ tight-fist­ed­ness. Re­cently, a bloc of eight hawk­ish north­ern states made clear its op­po­si­tion to a “trans­fer union.” In Ger­many, the surge of the xeno­pho­bic Al­ter­na­tive for Ger­many party has nar­rowed the gov­ern­ment’s scope for sol­i­dar­ity with the pe­riph­ery.

But the worst news comes from Italy. Last month’s elec­tion yielded a par­lia­ment dom­i­nated by two pop­ulist par­ties that re­ject eco­nomic re­spon­si­bil­ity. Even though Italy’s gov­ern­ment debt is al­ready off the charts, the pop­ulists sup­port a ru­inously ex­pen­sive uni­ver­sal ba­sic in­come and a rolling back of pen­sion re­form. In­deed, their ir­re­spon­si­bil­ity ex­tends fur­ther: More than a month af­ter the vote, they con­tinue to bicker about the shape of the next gov­ern­ment.

Europe’s mon­e­tary fragility, too ob­vi­ous to deny, means the re­gion will at least pre­tend to do some­thing. France’s pres­i­dent is keen to see progress, and some Ger­man lead­ers sup­port him. But Italy looks less de­serv­ing of trust and as­sis­tance than it has in a long time. Odds are that the French will ex­tract min­i­mal con­ces­sions from the north­ern­ers.

Maybe Trump is reck­less enough to tank the world econ­omy with a trade war. But the po­lit­i­cal risk looks higher in Europe. Re­mem­ber the ar­madil­los.

“The Man Who Knew: The Life & Times of Alan Greenspan.”

Pic­ture: File

Euro­pean economists have pro­posed mul­ti­ple ways to fix the mon­e­tary union. But they can’t get past a po­lit­i­cal fact: Rich coun­tries don’t want to un­der­write the pre­car­i­ous ones on the pe­riph­ery, which they re­gard as ir­re­spon­si­ble.

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