German Chancellor Angela Merkel speaks to the media following talks with French President Nicolas Sarkozy at the Chancellery on January 9, 2012 in Berlin, Germany. The two leaders discussed the ongoing Eurozone debt crisis as well as a possible European financial transaction tax, among other topics. ( Credit: Sean Gallup/Getty Images
If you haven’t been paying attention, the economy is slowing. This time, however, instead of blaming toxic assets or regulation failures, most eyes are on the European Union, where austerity measures and the weakening Euro have inhibited member countries’ spending ability – to the point that the rest of the world is feeling the effects.
Over the weekend, investor and philanthropist George Soros predicted that the EU has three months to turn things around, and by this Soros really means that Germany has about three months to decide if it wants to continue to subsidize weaker member countries (like Greece). Most analysts believe that Germany will take this option, rather than see the E.U. dissolve, which would return the country to a position where its own goods are prohibitively expensive.
Yet Soros warned that if Germany only offers the bare minimum of assistance, the next decade will likely be “lost” for the E.U., with Germany subsidizing and other member states continuing to struggle.
Today on the program, Patt breaks down what’s happening in Europe with Zoe Chace, of NPR’s Planet Money team.
What are the effects on the United States economy and what can we expect to see over the course of the next few months, or years?
Zoe Chace, reporter, NPR’s Planet Money
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