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EU Businesses

EU Clinches Massive Stimulus Deal To Bind Continent Together (bloomberg.com) 182

Posted by msmash from the moving-forward dept.
European Union leaders agreed on an unprecedented stimulus package worth 750 billion euros ($860 billion) to pull their economies out of the worst recession in memory and tighten the financial bonds holding their 27 nations together. From a report: The agreement, in the early hours of Tuesday after more than four days of acrimonious negotiations in Brussels, required the unanimous approval of the member states and represents a victory for German Chancellor Angela Merkel and French President Emmanuel Macron, who drafted an early outline for the proposal in May. The emergency fund will give out 390 billion euros of grants and 360 billion euros of low-interest loans. Almost a third of the funds are earmarked for fighting climate change and, together with the bloc's next 1 trillion-euro, seven-year budget, will constitute the biggest green stimulus package in history. All expenditure must be consistent with the Paris Agreement's goal of cutting greenhouse gases.
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EU Clinches Massive Stimulus Deal To Bind Continent Together More

EU Clinches Massive Stimulus Deal To Bind Continent Together

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  • The article fails to mention whether the U.K. gets any part of the stimulus or not. Without looking further I would bet they get nothing.

    Of course they will get some benefit from it anyway, as long as their economy is operable enough and they have something to sell to the EU. I have no idea what that might be.

    • Re: (Score:2, Informative)

      by Lilo-x ( 93462 )

      UK aren't in the EU so aren't part of this.

    • Without looking further I would bet they get nothing.

      And why would they? They aren't formally part of the EU and they weren't even present at the negotiations as they aren't a EU member and thus no longer party to its meetings.

  • The countries will be shackled together by billions of Euros of debt. However, one man's debt, is another man's pension plan, so it is OKish I suppose.

    • However, one man's debt, is another man's pension plan, so it is OKish I suppose.

      Debt without an increase in productivity results in currency devaluation (price inflation). Productivity is conserved - everything consumed must first be produced. If you try to consume more than you're producing (hand out money so people can buy "more" stuff, even though they're all locked up at home not producing anything), the economy has to figure out how to keep consumption and production equal. The way it does it is

    • Arguably, it's a better plan than the US congress writes, where apparently they just make up $ numbers with lots of zeros, and no consideration whatsoever about where that money is ACTUALLY coming from.

      For example, the first US stimulus package, ostensibly recognized as the one that handed out $1200 checks to everyone.

      $3 trn.
      There are 330 million people in the US.
      Only about 50% of them pay any federal income tax at all, so 150 million.
      This works out to about $20,000 per taxpayer, to hand out $1200 checks.
      Of

  • But I thought Europe was on a single plate anyway.

  • In order to defray the cost of the program, the bloc will increase the amount of revenue it can collect. A new tax on non-recycled plastic waste will be introduced next year, and the European Commission is preparing proposals on a digital tax and a carbon border adjustment mechanism that would take effect in 2023.

    That should make the U.S. digital giants sit up and take notice.

  • Ok, you can't stimulus spend when stuff is shut down. It's like walking into a carnival midway 30 minutes after they turn off the lights for the night.

    We should call it what it is: throwing money at people so they won't hate us, the politicians.

    Boy, it's a good thing there's no votes allowed for people who won't be born for decades.

    • I disagree with your central point, but even setting that aside I'm not sure what you're advocating here. Little/no economic stimulus, coupled with austerity? Didn't work so well for the EU in 2008, and I don't see any reason it'd work better today.

  • When the US gets through printing stimulus money, people will be getting paid in million-dollar bills. After the equivalent happens in the Euro bloc, there is going to be a shortage of wheelbarrows to carry these around in. A few of the really old Germans will remember the last time this took place. It may take detailed coordination among home improvement distributors in major nations to make sure that ther will be enough wheelbarrows for all. We don't want recovering Covid survivors to have to drag their m

  • You can't spend your way out of a recession. At best this kicks the necessary economic adjustments down the line, and at worst they'll inflate the euro so much that the whole thing augers in. Given the policies used over here in America for the past, oh, twenty years or so it'll be interesting to see which of us wins the race to the bottom.
    • Comparing the US (aggressive stimulus) and EU (austerity) following the 2008 financial crisis seems to show that you can in fact spend your way out of a recession. Of course, there's no counterargument to the claim of "just wait and see! inflation and economic collapse are just right around the corner!"
  • I don't understand why the market is doing OK when the physical reality of the situation is bleak.

  • One stimulus to rule them all (Score:3)

    by Dunbal ( 464142 ) * on Tuesday July 21, 2020 @04:28PM (#60316433)
    One stimulus to find them, One stimulus to bring them all and in the darkness bind them. In the land of Brussels where the Shadows lie.

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