Remove barriers to private enterprise (deregulate)
Keep your labor force competitive (reform)
Maintain liquidity in the banking systems (plenty of that right now)
Reward productivity and make poverty hurt

In our particular situation there is an added problem that everyone else has already cited, and that is that our own capital is tied up in other things – debt. Demand suffers because of our own consumer level debt. Injecting transactions into the economic stream does very little because the extra money is just used to reduce debt, not build investment.

Currently, we are doing none of these things other than keeping the banking system liquid. As corporations pile up mountains of cash, they’re not going to use it until demand strengthens and/or tax laws are revamped to allow them to repatriate the funds back to the US. Any attempt to mask this massive deleveraging, though, is just an expensive bandaid.

It’s not going to be hard for Europe to abandon “austerity”, mainly because they’ve never touched it.

Warren, over at Coyoteblog, has a summary piece derived from Cake Hayek.

The graph alone spells it out.

For the Euros, as much as with Congress — “austerity” means “not increasing our spending this year.”

Actually cutting anything?

BWAAAAAAAAahhahahahahahahahahahaaaaa!!!

Yep. Its the I must be able to buy whatever I want because I still have checks in my checkbook mentality.

I get so weary of discussions about what happens if Greece defaults. Greece has already defaulted and we can all plainly see what happens. I will gladly pay you Tuesday for a hamburger today has morphed into I will gladly pay you Tuesday for a hamburger today if you will loan me the money to repay you on Tuesday. Wimpy, the new avatar of the leftists, rules until he doesn’t.

If you want to know what they are going for, you need look no further than the more extreme Democrats here in America. Taxes will increase, on everybody. Control of the economy (and other areas) will be, as much as possible, assumed by the state (and that power handed out to unelected “officials”). Laws will be created to keep the rich from dealing with competition, which makes it easier to steal from them (or simply eliminate them and make what is private “public”). It’s not tricky. It isn’t even calculus, let alone brain surgery or rocket “science”. Nail meet hammer. Hammer, do your job. Done.

To answer your last question: at the nearest organic food market, of course.

The Greenie movement stiil holds many in its grip, and now there is the Pirate Party to contend with. This is a bunch of internet types who want more transparency and citizen participation in government (via internet, of course), but they don’t seem to know enough about any issues to state other positions. They are a big enough force that they will somehow have to be accomodated in the next campaign.

It’s looking like Merkel is still holding firm with Hollande, and he has been attacking her. But she cannot ignore the smaller parties, which will continue to push for their incoherent dreams. The media is still in the tank for the apocolyptic utopians. Just yesterday they gave a nice little hunk of time to a WWF report about the world using up all its resources. With this going on, no one can say what policies will develop. Don’t expect coherence, though.

FWIW, the Euro is rolling over and heading towards long time lows. The markets didn’t like the results of that election. Nor the French one.

Well, if by “the monetary union” he means the EU–and I believe he does–many would say “good riddance,” and I’d be among them.That is what tied the economies of member countries together so tightly, and put nations such as Germany in nearly the same boat as Greece.

While Greece gamed the system, borrowing and borrowing, the system also benefited Germany. When the Euro replaced low-value currencies such as the Greek drachma, Germany was able to export more goods than before.

I don’t see any solution but for Greece and other countries to leave the Euro. When the Germans and the French learn to accept that reality, they may come up with some realistic solutions. Will the Euro completely collapse? Don’t know.