The inevitable is getting closer and closer. The economy of the Eurozone as a whole officially slipped into recession today, according to Reuters.
The French and German economies both managed 0.2 percent growth in the July-to-September period but their resilience could not save the 17-nation bloc from contraction as the likes of The Netherlands, Spain, Italy and Austria shrank.
Economic output in the euro zone fell 0.1 percent in the quarter, following a 0.2 percent drop in the second quarter.
Those two quarters of contraction put the euro zone's 9.4 trillion euro ($12 trillion) economy back into recession, although Italy and Spain have been contracting for a year already and Greece is suffering an outright depression.
A rebound in Europe is still far off. The debt crisis that began in Greece in late 2009 is still reverberating around the globe and holding back a lasting recovery.
. . .
Most economists expect Germany to contract in the fourth quarter for the first time since the end of 2011. And where Germany goes, France is likely to follow.
There's more at the link.
Liberal and progressive economists in Europe are blaming spending cuts and austerity programs for the renewed recession, but this is, of course, ridiculous. The Eurozone, like the USA and other countries, has plunged headlong into debt over many years. That debt is now a millstone around its neck, soaking up vast resources to pay the interest on it even as more and more borrowing is necessary to fund social programs. The only cure is to stop spending money the Eurozone doesn't have, stop printing money like there's no tomorrow, and return to a balanced economic program; but that would mean cutting back on entitlement programs and social safety networks. That would spell disaster at the polls for politicians, who will do literally anything - including spend their economies into ruin - rather than accept that fate. The people of Europe, too, are unwilling to hear any message that they must accept a reduction in the amount of money the state spends on them. Anti-austerity protests and riots broke out (again) all over the Eurozone today.
I expect the same to happen in this country when (as must inevitably happen one day, probably soon) our government runs out of money to fund the free stuff it's been handing out so liberally to buy political support. Meanwhile, our own economic future appears bleaker by the day. The Christmas shopping season is off to a very dubious start, and I think it's unlikely to improve. If you see breathless news stories about how much money people are spending, I strongly advise you to take them with, not a few grains, but a few pounds of salt. I'm hearing very worried noises from friends and fellow bloggers who work in a number of large consumer-oriented companies, none of whom are at all happy with the current state of affairs.
This Christmas, I suggest we give each other gifts that will be useful in an economically bleak future. We'll be all the more grateful for them before long.