EU Presidency: Obama Plans 'a Way to Hell'

[RipCity]

STRASBOURG, France — A top European Union politician on Wednesday slammed U.S. plans to spend its way out of recession as "a way to hell."

Czech Prime Minister Mirek Topolanek, whose country currently holds the EU presidency, told the European Parliament that President Barack Obama's massive stimulus package and banking bailout "will undermine the stability of the global financial market."

A day after his government collapsed because of a parliamentary vote of no-confidence, Topolanek took the EU presidency on a collision course with Washington over how to deal with the global economic recession.

Most European leaders favor tighter financial regulation, while the U.S. has been pushing for larger economic stimulus plans.

Topolanek's comments are the strongest criticism so far from a European leader as the 27-nation bloc bristles from recent U.S. criticism that it is not spending enough to stimulate demand.

They also pave the way for a stormy summit next week in London between leaders of the Group of 20 industrialized countries.

The host of the summit, British Prime Minister Gordon Brown, praised Obama on Tuesday for his willingness to work with Europe on reforming the global economy in the run-up to the G-20 summit.

The United States plans to spend heavily to try and lift its economy out of recession with a $787 billion economic stimulus plan of tax rebates, health and welfare benefits, as well as extra energy and infrastructure spending.

To encourage banks to lend again, the government will also pump $1 trillion into the financial system by buying up treasury bonds and mortgage securities in an effort to clear some of the "toxic assets" — devalued and untradeable assets — from banks' balance sheets.

Topolanek bluntly said that "the United States did not take the right path.".

He slammed the U.S.' widening budget deficit and protectionist trade measures — such as the "Buy America" — and said that "all of these steps, these combinations and permanency is the way to hell."

"We need to read the history books and the lessons of history and the biggest success of the (EU) is the refusal to go this way," he said.

"Americans will need liquidity to finance all their measures and they will balance this with the sale of their bonds but this will undermine the stability of the global financial market," said Topolanek.

Obama insisted Tuesday that his massive budget proposal is moving the nation down the right path and will help the ailing economy grow again. "This budget is inseparable from this recovery," he said, "because it is what lays the foundation for a secure and lasting prosperity."

Obama also claimed early progress in his aggressive campaign to lead the United States out of its worst economic crisis in 70 years and declared that despite obstacles ahead, the U.S. is "moving in the right direction."

Source

 

[CelticKing]

Some good criticism coming from EU.

 

[RipCity]

We have the same problem now as we had during the election, the American Media is still giving him the soft touch. Criticism of Obama on news networks not named Fox is about nonexistent, and clearly Fox being Republican TV and all clearly they can't offer an objective opinion

And honestly, the laundry list of fucked up things Obama has done since he was inaugurated is quite long and distinguished, I'm not asking for them to bring it all to light as they should, just picking one thing would be enough.

 

[CelticKing]

^ It really is a shame though, it's like the American media are afraid of criticizing him. But I agree, he has done so many bad things, that we'll feel the effects for the next 20 to 30 years.

 

[Bahir]

^ It really is a shame though, it's like the American media are afraid of criticizing him. But I agree, he has done so many bad things, that we'll feel the effects for the next 20 to 30 years.

Are you talking about Bush? Because if you are talking about Obama, I'd like to hear what those things are.


On topic: yes, the protectionist measures are the worst, because it is counterproductive to international trade and the global economy. The global financial system definitely needs to be more regulated and standardized across nations, but that is more of a preventive measure for the future, since the damage has already been done. The government buying up toxic assets could be good if the current owners would go bankrupt with them, and the stability of the financial system relies on them not doing so. Just writing them off won't work.

What is needed (and will allegedly be provided) by Obama is public investment in education, infrastructure and other projects that will increase productive capacity and employment in the future. The sad reality is that the US, and many other western countries, are burdened by industries that are too expensive to run compared to how they are run in Asian countries. If American cars were really "better", then the price and demand would reflect that, but that's not the case. The US, and other countries, need to let outsourcing be unrestricted in order to gain something in the long run. The obsolete domestic workers should be put into education for industries that aren't likely to be outsourced, and produce products that preferably are exportable.

For instance, the Swedish government will not bail out SAAB, nor Volvo iirc, and that's a good thing. SAAB hasn't been profitable for decades, so it's better if that which can be salvaged is sold to other companies, and the redundant employees retrained for other industries.