how joining the EU trade zone destroyed Portugal's economy

Discussion in 'Economics & Trade' started by kazenatsu, Jan 17, 2021.

  1. kazenatsu

    kazenatsu Well-Known Member Past Donor

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    Basically, the industry was driven into extinction by cheaper imports, so the nation turned to tourism. Tourism was devastated by the foreclosure crisis of 2008 and then even more by the 2020 coronavirus pandemic. The people defaulted on their debts and if home owners, lost their home. The elites also defaulted but the government bailed them out. Bottom line is unemployment is and has ben way over 10% to 15% since 2009, so the nation's people are being crushed.

    Paulo Rodrigues
    January 13, 2021
    In Scotland today, as it was in Portugal many years ago, the elites are pushing for the EU integration, saying to the lower classes that “it will be in the best interest for all”.
    The “trickle down” mantra for short.
    And then they destroyed the Portuguese economy in 20 years.
    Industries closed by the thousands and services (particularly those connected to tourism) flourished.
    With an external big deficit and a government deficit limited by EU rules, the private sector just went on a debt spiral. That’s pure and simple algebra.
    And then came the GFC.
    Many households collapsed and defaulted their credit repaying to the banks and, in consequence, lost their homes.
    The oligarchies where more indebted than households and all of then defaulted on their credits.
    Not because they couldn’t pay, but because they knew the state would nationalize their debt, to save the banks.
    And then came COVID-19.
    Peoples rights are being “managed” by the elites and their handy servants in power.
    The economic debacle will extend to new heights.
    So you see why the elites want the EU and the euro.​

    I've been saying this for a while now. Joining free trade zones and opening up to other parts of the world isn't always the best thing to do.
    It can be important for a nation to maintain some level of economic self-sufficiency, especially if they have mounting chronic long-term trade deficits (buying more imports than the money that goes into the country).

    The EU trade zone promised new prosperity, but as we can see, it has not really delivered on that promise for many countries in Southwest Europe.

    Portugal apparently thought that they could trade their export industry for tourism instead. Apparently they seem to have been mistaken about that. They were already proved to have been mistaken about that before, but the pandemic has really pushed the issue to a head.


    related threads which may be of interest to some:
    unemployment, many young Europeans without jobs
    Judge orders 25-year-old man to leave home and find job
    Spain's economy plunges into malaise, may become trapped in situation like Italy
     
    Last edited: Jan 17, 2021
  2. The Rhetoric of Life

    The Rhetoric of Life Banned

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    See, the thing about the EU is, those people who lead in it suppress nationalism of self interest.
    https://rmx.news/article/article/the-ep-president-bans-national-flags-on-meps-desks
    and your example stinks of thinking of your own interest instead of the bloc's collective interest, so it's never going to happen because it's an importance that's lost on the EU elite.
    https://www.europarl.europa.eu/news/en/press-room/20181106IPR18316/merkel-nationalism-and-egoism-must-never-have-a-chance-again-in-europe
    They're a collective, which unfortunately means real countries are being told what to think rather than self interest being told it's in their interest to accept the EU way.
     
    Last edited: Jan 18, 2021
  3. kazenatsu

    kazenatsu Well-Known Member Past Donor

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    Europe is not like the US. You can't just so easily get up and move to where the new economic opportunities shift to. There are some big regional language barriers.

    Only the poorest and most desperate migrants find it worth the relative cost to try to deal with and overcome that hurdle, like the ones from outside of Europe.

    When you open up your nation's economy, that economy can begin shifting away to another place.

    These people in Southern Europe enjoy their quality of life in the nations that they live, they don't want to have to get up and relocate to England or Germany.

    There are also issues of protecting standards of living and labor, if workers in Southern Europe have to compete with other parts of Europe and the world that are much poorer.

    Right now in Spain there are vast estates of abandoned housing projects, left over from the construction bubble, which people could not afford to buy and live in, yet at the same time there is a growing problem of people not being able to afford to live in Spain's big cities. The job opportunities are not so great in most areas of the country (outside the cities), can be difficult to eek out a really middle class way of life. Those who do manage usually have farming operations passed down to them from their families, which is still a lot of work to run and can be difficult to keep the business afloat, while the remainder almost live like migrant laborers. A difficult life that probably not a lot of people in England or Germany could imagine.

    The average salary for a university graduate in Spain today is € 26,700 (32,245 US dollars) and these higher paid jobs of course are all in the cities.
    And only 1 in 3 adults in Spain even have this university education (it's actually slightly less than that). 26,700 euros is certainly enough to get by, but it is not that great. The median salary in Spain is € 23,999 , so new university graduates do not earn all that much more than most adults.

    Spain's tax rate is also about 50% higher than the US for the average income, so that also cuts into personal finances.

    We are talking about decidedly lower standards of living, when it comes to money. I think many people in other developed countries like the US or Germany would regard that as lower middle class. That is how most of the population in these countries lives.

    Spain also gets a lot of immigrants from Latin America, because it is Spanish-speaking. So that probably has had an effect on the dynamic of the labor market.

    To additionally give some better idea about standard of living. About 90% of adults in Spain still manage to drive a car. In Portugal, about 75% do.
    That kind of indicates that these countries are poorer, but they are still First World.
     
    Last edited: Jan 18, 2021
  4. The Rhetoric of Life

    The Rhetoric of Life Banned

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    They don't care.

    They'd come to your country, not know the language, and still live and work.
     

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