Speaking of “Debt Traps”, Europe Takes the Cake
The G7 Summit just passed a policy of countering what they claim is a “Chinese debt trap” caused by the Belt-and-Road strategy. But whereas China is focusing on productive debt, in the form of investments in projects in real infrastructure and industry, the EU intends to produce yet more unproductive debt — wildly increasing expenditures for weapons and military expansion, wasting taxpayer money on illusory “Green Reset” projects, and servicing past debts (to private banks) at the expense of the real economy.
Leaving aside for the moment the masses of fictitious debt created by the banks and corporations, which is in fact a much more serious problem, the national debt of countries in the Eurozone has increased significantly over the past 20 years, as shown in a new Statista graph based on data from the International Monetary Fund. This is particularly true of the countries shown in one chart — Greece, Spain, Italy and France. The mountain of debt in the Eurozone as a whole rises from 69.4% to 93.4% in the period shown, calculated as a share of the GDP.
France had the highest absolute government debt within the European Union in the fourth quarter of 2021, at around €2.81 trillion, with Italy close behind with around €2.68 trillion, but a much lower economic output. Germany, the third-largest debtor, came in at €2.475 trillion. A totally wrong approach, however, would be to attempt to reduce the spending on vital social programs and infrastructure, rather than proceeding with an orderly reorganization and, where appropriate, cancellation of the illegitimate debts.