Economically weak European countries will be kicked out of the euro zone
Euro-rescuers plan to make a virtue out of need, they write German economic news, as the EU effectively splits due to the UK's intention to hold a referendum on leaving the European Union. According to the new plan, the euro area should turn into a small unitary state. Principles of the new financial model: redistribution and joint guarantee of bank deposits. France and Italy will benefit from this system first of all.
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An important EU summit will take place at the end of June. Two documents published by Financial Times, which talk about plans for the unitarization of the EU and the compression of the euro area.
The documents report that as a result of integration processes in the EU, Italy suffered heavy losses. Monetary union brought Italy: reduced growth, increased unemployment, risk of prolonged stagnation economics.
The Italian government reports that there is growing concern about the alienation of citizens from the European project, and anti-European sentiment is widespread, leading to the emergence of populist forces. Citizens are still seriously affected by unemployment, poverty and growing inequality.
The paper argues that a deeper political union must therefore be achieved if the monetary union is to be sustainable and strengthen social cohesion. Then concrete schemes for joint unemployment insurance and deposit insurance could be created as the third pillar of the banking union.
Already in the autumn of 2013, the overall level of unemployment in the euro area alarmed the then French Finance Minister and the current EU Commissioner for Monetary Policy, Moscovici. “Euro asymmetrical design,” he called the “EU fiscal union.” He said the EU must create a “strong supranational budget” from which some unemployment benefits could be financed.
Italy's unemployment rate is currently more than twice that of Germany, so spending on unemployment benefits is creating large holes in the government budgets of cash-strapped countries. The unemployment rate in the euro area was 11,4% at the end of last year.
This project to unite the euro area into a virtually single state completely excludes the admission of new members to the EU, since the financial capabilities cannot cope with the existing members of the union.
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