Current front runner for president in France François Hollande may be on the boring side but he’s right about scrapping the failing policy of austerity. Germany is not going to be happy about this but the German efforts to strip spending is failing miserably across Europe. The UK is going back into recession and the debt crisis is hitting the austerity countries as well, despite assurances that that would not happen. The Germany model has to change unless they want the entire EU to collapse.
Mr. Hollande also praised the position taken in Brussels on Wednesday by the head of the European Central Bank, Mario Draghi, who said he favored “a growth compact” of structural reforms in parallel with the fiscal treaty limiting budget deficits and national debt. But there was little indication that Germany, the driving force behind the austerity-driven fiscal treaty agreed to last month, was warming to his ideas. In the first news conference of his campaign, Mr. Hollande said that he would propose four modifications to the European Union treaty, favored by Germany and approved in March but not yet ratified. Most significant, perhaps, he called for the creation of collective euro bonds, but to be used to finance industrial infrastructure projects, not to consolidate debt, which the Germans oppose.