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The European Union – Toxic Mix of Confusion, Neo-Liberalism and Failed Policy

France, Italy, the European Union - Toxic Mix of Confusion, Neo-Liberalism and Failed Policy (article)

CNBC, the US financial news organization reported two days ago, that the EU, specifically Italy, France and the UK/Brexit stories were signs of a beginning stress patterns in the EU. We at Classiarius have reported for over a month that the budgets of these states are under severe stress and it will only get worse. Keep reading below regarding Neo-liberalism, demographics and more.

Here at Classiarius we make rather aggressive predictions with time archs of 10 to 20 years or more. Currently we are focused on the European Union and its member states` inability in the near future, to please both the European Commission and their local populations. Of course there is the issue of elected officials and sovereignty that seem to be elevated but more importantly, the idea of demographic implosion is eroding the tax base of the member states – we see a serious budget issue for the entire European block of nations in 5 to 10 years. In short there are too many people asking the government for handouts and too few new programs for business formation.

Specifically the budgets of these countries will not be able to cope as tax revenues fade in a weakening global economy while social services and their demands from an aging population and waves of newcomers increase. Over the past month riots in the streets erupted in France and President Macron capitulated, questioning the Neo-liberal model, the European Union and Welfare State. Are the French now having serious problems? It seems that this is the case.

Right now the European Union is telling individual states to stretch their budgets by taking in millions of new citizens who are not adding enough value to the states that are sponsoring them. More importantly when European economies start to slow – in terms of economic growth – social welfare  programs will be bankrupt and these states will be forced to decide to give support to the indigenous populations or the imported populations. To be clear, we at Classiarius (ourselves immigrants and expats) do support immigration, and more importantly, assimilation of manageable numbers of newcomers.

Several hours ago, France`s Macron announced tax cuts and wage increases in the face of violent protests.

According to the Marcon proposal people will see their wages increase by 100 Euros per month from 2019 without any added costs to the employers. Still, with tax cuts also aimed at the protesting middle class, many of whom are complaining that they hard work is supporting migrants and not their families, the question is will the riots in the streets fade out. Also, pensioners earning less than 2,000 Euros will see taxes on social security dropped. These concessions are likely to disrupt economic policies that could eventually damage the budget of France and other countries who follow said policies.

These policies that are being adjusted will only cost the state more and are contrary to the promises that Macron made before being elected. In the end, we feel that our prediction of the weakening economy might come to pass by 2020 and beyond.  The European Union has too many stress points to last another 10 years, we think it collapses.

Team Classiarius

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Disclaimer: We do not provide investment advice or strategies, this article is not intended as such but only to provide you the reader with information. Please conduct your own research before any investment of any kind.

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