On CNBC today, Steve Liesman said it's time the U.S. took the lead in creating and implementing a European rescue plan.
We can't fix our own mess, but Europe's going to open its arms and let us restructure its quagmire?
That's crazy. Since 2008, all kinds of cash has been pumped into failing entities at home and abroad, but nothing's been fixed. A flood of new IMF (U.S.) cash might push Europe's catastrophe back, but it won't stop it.
A big reason for trouble in Europe now is the EU removed age-old economic safeguards. National economies used to act like the bulkheads of a ship, usually containing damage if one economy ruptured. But the EU model eliminated bulkheads or at least rendered them far less efficient. Now trouble in one state quickly flows to another and then another.
Liesman's plan may sound good to conventional thinkers, but like all the other bailouts and cash infusions, it's unlikely to fix anything. It might buy some time and push disaster back by six months or even a couple of years, but unless Europe's bulkheads are restored and its nations trim the flood of unsustainable spending, the Titanic will still go down.
Does anyone think we'll fare any better having tightly lashed our own ship to its side?
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