Why politics matters

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It has been quite a couple of weeks. Francois Hollande is elected President of France on a less Austerity ticket. The Greeks don’t elect anyone to run the country but open the door to some of Europe’s most agressive fascists. And the fickle English electorate finally shows that it realises that the Conservatives rule in their own interests. It may be too late on that one, however, if healh service ‘reforms’ and educational ‘reforms’ go unchecked.

This all challenges the ‘fix’ agreed by the previous generation of European leaders regarding the Euro and sovereign debt. Yesterday morning we learned that Spanish government bailed out the country’s fouth largest bank, Bankia. Today they are shoring up the rest of the banking sector against the backdrop of no growth, high unemployment and investor withdrawal of funds.

It is clear, however, that electors are unlikely to be swayed by policies that continue to support those who have brought on the misery by their own greed, self-belief and inability to manage their own financial instrument creations. (This morning we find JP Morgen Chase have reported an embarrassing $2bn loss generated by a trader in derivatives that were designed to hedge against risks elsewhere in the bank.)

I’m hopeful about the French. The Greeks, however, have resorted to a fascist response. I suspect a contagion is not likely across Europe, the Greeks will need to manage them robustly. They are not democrats.

Flag courtesy of Stlemur

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