Monday, May 07, 2012

The other election

In addition to Greece - where the pro-austerity quislings have officially lost their majority - there was another important election today: France. And there, Socialist candidate Fran├žois Hollande has trounced Nicolas Sarkozy to become France's first left-wing President in 17 years.

This is going to make a big difference. Hollande is opposed to austerity, so he'll be running a better economic policy in France. But he'll also be opposing German attempts to impose an austerity straitjacket at a European level - and that will be enough to make sure it won't happen. The result is that Spain, Portugal and Italy will have more space to grow their way out of trouble, rather than being required to crash their economies to please the Germans. And it will mean that whatever emerges from the rubble in Greece will probably be able to get the better bailout terms their people are demanding.

The markets are not going to like this of course (let alone the austerity cultists at the European Central bank), but they are just going to have to learn to cope. The people have spoken, and their message is clear: they are not willing to crucify themselves for the profit of bankers. Politicians elsewhere should take heed.