Euro Moving Towards Collapse, Says Rodney Shakespeare

Press TV, Thu Nov 25, 2010 1:15PM

Euro is expected to collapse and leave Europe in an economic and political catastrophe, unless its "corrupt" banking system is controlled, an analyst has told Press TV.

"What you are looking at is the collapse of the euro which is the financial underpinning of the political structure which is called Europe," Rodney Shakespeare, Professor of Binary Economics, said on Tuesday.

"There is a great catastrophe coming and we are just seeing the beginning stages of it," he said in an interview with Press TV.

Referring to the recent debt crisis in Ireland and other eurozone members (Greece and Portugal), Shakespeare argued that financial bailouts are not the solution to these woes.

"These bailouts and financial corrections have nothing to do with the real economy of jobs and ordinary people ... [and] are not adjusting the underlying problem," he said.

Shakespeare attributed the problems to "the interest bearing money created by the banks endlessly."

He said the banking industry, which is inspired by the "Western free market" doctrine, is to blame for "lobbying" to create economic havoc across Europe and the US.

"Right now the governments are attacked and controlled by this doctrine and they just serve the interests of the banks," he added.

On the other hand, the banks "are serving the interests of the military industrial complexes" and "the interests of a tiny group of companies," Shakespeare pointed out.

He warned European governments that, "Unless in fact you can get all the ordinary people productive, so that producers and consumers are the same, you cannot have a true, balanced free market."

Earlier, the Irish government presented a four-year austerity plan seeking to save EUR 15 billion to secure an international bailout.

The plan seeks to reduce Ireland's 2014 deficit to 3 percent of its gross domestic product, the eurozone limit.

The changes come after Ireland decided to accept a multi-billion euro bailout from the International Monetary Fund and the European Union in a bid to save itself from a total financial collapse.

ASH/ZHD/AKM

Irish government unveils four-year economic plan

DUBLIN, Nov. 24, 2010 (Xinhua) --

The Irish government on Wednesday published a four-year recovery plan that involves a record budget cut of 15 billion euros (about 20 billion U.S. dollars) over the next four years in order to reduce the country's deficit.

The four-year plan includes 6 billion euros (about 8 billion dollars) in spending cuts next year and another 9 billion euros (about 12 billion dollars) between 2012 and 2014.

It also includes income tax increases, deep cuts in social welfare expenditures and a reduction of 10 percent or more in the minimum wage, one of the highest in Europe.

The plan, described as a "blueprint for a return to sustainable growth in our economy," was unveiled by Prime Minister Brian Cowen, Finance Minister Brian Lenihan and Environment Minister John Gormley.

The government has already made clear that an "adjustment" of 15 billion euros (about 20 billion dollars) will have to be made over the next four years.

The plan confirms that 10 billion euros (about 13 billion dollars) will be saved by way of cuts in spending and 5 billion euros (about 7 billion dollars) by way of tax increases.

According to the plan, the government will reduce the cost of the public sector pay and pensions bill, social welfare, and public service programs, and achieve savings in social welfare expenditure of 2.8 billion euros (about 3.7 billion dollars).

The government will cut public service staff numbers by 24,750 from the levels of the end of the year 2008, back to levels last seen in 2005, said the plan, adding that overall payroll adjustments of 1.2 billion euros (1.6 billion dollars) by 2014.h The plan will introduce a reformed pension scheme for new entrants to the public service and reduce their pay by 10 percent, the plan said.

Measures including reducing the minimum wage by 1 euro (1.3339 dollars) to 7.65 (10 dollars), will create 90,000 jobs during the course of the plan, according to the plan.

EU welcomes Ireland's austerity plan

BRUSSELS, Nov. 24, 2010 (Xinhua) --

The European Union (EU) Wednesday welcomed the four-year austerity plan unveiled by Ireland, saying it is "a sound basis" for the negotiations between Dublin and the EU and International Monetary Fund (IMF).

European Commissioner for Economic and Monetary Affairs Olli Rehn said in a statement that the fiscal plan is an important contribution to the stabilization of Irish public finances.

"The plan strikes a good balance of durable expenditure and revenue measures, with due regard to protecting the least well off, " Rehn said.

The commissioner said the 2011 budget involving a consolidation effort of 6 billion euros (about 8 billion dollars) would be " appropriate," as it would strike a balance between allowing the nascent recovery to strengthen and addressing budgetary challenges in a timely fashion.

He also hailed the structural reform commitments in the plan, saying "these policies encourage exports and a recovery of domestic demand."

"Implementation of the reforms will thus contribute to the authorities' ambitious fiscal adjustment strategy and a return to fiscal sustainability," Rehn said in the statement.

The Irish government published its four-year austerity plan Wednesday afternoon, which includes 6 billion euros in spending cuts next year and another 9 billion euros (about 12 billion dollars) between 2012 and 2014.

It also includes income tax increases, deep cuts in social welfare expenditures and a reduction of 10 percent or more in the minimum wage.

Editor: Mu Xuequan