Bill Mitchell — France has received its orders from the masters

Angela Merkel and Bundesbank's Jens Weidmann rain on Charles DeGaulle wannabe Emmanuel Macron's parade. There will be no fiscal union with the North picking up the tab for the South.

This is a long post setting forth the issues standing in the way and why they are unlikely to be overcome. The chief obstacles are cultural and political rather than economic. A federation among sovereign nation states is not possible without restrictive concessions that the German elite reject.

Conclusion

The point is clear.

Macron can say what he likes. But unless he can get it past the masters (Germany) anything he says will be hot air.

And it is clear from history that Germany will never tolerate the creation of a true federal fiscal capacity.

Which tells me the Eurozone is never going to work in the way the leaders claimed it would at the outset – it will always be prone to stagnation and crisis.

Macron destined to be another Hollande? Bill thinks so.

Bill Mitchell – billy blog
France has received its orders from the masters
Bill Mitchell | Professor in Economics and Director of the Centre of Full Employment and Equity (CofFEE), at University of Newcastle, NSW, Australia