I beg your pardon,
I never promised you a rose garden.
Along with the sunshine,
There's gotta be a little rain sometimes.
When you take, you gotta give, so live and let live,
Or let go.
I beg your pardon,
I never promised you a rose garden.

I've written over and over that I think the Euro survives because of centuries old dreams of a united Europe. It's unlikely such a goal will ever again be contested on battle fields, but there is a war going on right now and at stake is nothing less than a single continental Europe under a single umbrella. How interesting that all the talk has been about the fiscal crisis unraveling this dream rather than bringing it closer to reality. In fact, as I watch, read, and listen to coverage of this situation I'm reminded of an episode of the Twilight Zone.


In that episode ("The Midnight Sun") a woman deals with the earth moving closer and closer to the sun. There are all the elements of panic, fear, and contemplation as earth hurtles toward the sun. The woman deals with these issues with a neighbor and the overall sense of hopelessness. As it turns out the earth wasn't hurtling toward the sun but away from the sun. Most of the episode was a daydream of sorts; the women dealing with circumstances, wondering if it was the exact opposite. Neither sounds like a lot of fun, yet almost all coverage of the European crisis has held that there are two outcomes.

The Euro and EU unravels
The Euro and EU survive but barely

I Beg Your Pardon

There is a scenario that I figured a long time ago would prevail:

The Euro survives, but nations give up more sovereign rights. There will be some trillions of Euros eventually spent to resolve decades of wasted potential and lavish lifestyles. Going into this past weekend Mariano Rajoy said Spain is "not on the edge of a precipice," adding "it's not a bed of roses, but this is not the eve to the apocalypse either."

But over the weekend the tune changed a little with Rajoy asking for a new fiscal authority to handle all of Europe's finances. The suggestion is such an authority would also keep Greece in the mix. The thing is such an authority would also move the European Union closer and that means giving up sovereign rights. This was the main goal for many at the very start, so while there will be feigned shock and resentment there really can't be true surprise. It does create yet another challenge. How much more will European counties be willing to give up for Germany to make their lives easier?

Spain is only a couple months into its austerity, and the new conservative government is blinking big time.

In the meantime, Angela Merkel is really positioning better and better. She has proven she can take the heat from fellow leaders including the President of the United States, and despite recent election losses at home, her nation isn't ready to abandon her leadership. Recently several union members got sweet pay raises, and Germany's economy is still humming.' Now it appears she is softening her steadfast opposition to Euro Bonds—with certain conditions. In fact, in an interview Merkel borrowed a line from the same song Rajoy was singing.

When you take, you gotta give, so live and let live

Or as Merkel put it: "You can't ask for euro bonds, but then not be prepared to take the next step towards closer integration."

The bottom line is that there is a ton of debt that will not go away and a bunch of people that want the easiest way out, even if that means chipping away at more of their ability to self-govern. These are the choices that are evolving but have been embedded in the promise of a united Europe from day one. In Italy Mario Monti has already hinted there would have to be a reasonable compromise for debtor nations that are asking for even more money to give something up in return. That something is huge.

This is going to go beyond money because in the end Greece, Spain, Portugal and maybe even Italy will not have enough firepower to ever pay back their debts in money. So, they'll have to pay it back with their souls.

Along with the sunshine

On Friday, Barack Obama seemed like the most detested president ever. I'm serious; he was way too upbeat at that Honeywell (HON) plant and exhibited no shame over attending six fundraisers on the same day America's economic pain was laid out for all to truly see. Moreover, not only could we see it officially but we all felt a twinge. People with jobs had to feel somewhat sheepish knowing at this late date in the recession or post-recession if you believe in official timestamps they are still in the mix, but someone in their family, circle of friends, and neighbors are on the sidelines or working in a job a million miles beneath their skill level.

I hope we get away from a political system that is now lurching into Vaudevillian territory, the song and dance and happy faces, when there should be faces etched with concern, caring and even contrition. We can handle the truth. We actually live the truth, so we would appreciate the truth. Can the incumbent ever admit to any mistakes or to a sense of urgency to alter policies that aren't working?

I for one would love to see this happen. Don't talk about shared pain and raise $7.2 million the same day news reflects a nation in immense pain and obviously vulnerable.

Today's Session

Ugh ... when will they stop bringing out these phony economists to bitch about income inequality in America as we watch countries with better ratings melt before our very eyes? I think it's a moral topic, not economic. People are not brainless and have choices in America. But, when you make mistakes like dropping out of school, or accept a slacker mentality like sleepwalking through work and bolting at five on the nose to grab a few brews and make it home in time for "Dancing with the Stars" you are not going to make a lot more money. If we get caught up in not being honest about why a giant chunk of people are on the economic treadmill then we are going to kill the nation in a cloud of envy-driven policies that attempt to reward mediocrity.

These economists think we're moving closer to the sun, and attacking successful people is like burning all the coats, but in fact we are moving further away from the sun.

The futures act better than I anticipated, but we aren't going to force the issue this morning.

Comments

Yes, provided he or she identified what they felt were the major problems of dysfunctionality in their original plan and outlined specific new proposals to fix them. Everyone has a learning curve. Patricia Knapp on 6/4/2012 9:59:27 AM

That would depend upon the circumstances...One might say it would take a lot of courage to do, HOWEVER, there would have to be a master plan supported by substantive data to show that the change would benefit the country. It could not be a case of well, this didn't work so we'll try this new thing instead. As for our current situation, I do not believe this President or his advisors have a clue as to what would work; that their ultimate goal to "fundamentally change this country" continues just as they want it to. Sadly, too many people are still buying into this charlatan. Marie C on 6/4/2012 10:03:11 AM

it would take some humility and lots of integrity for a politician to admit a mistake in policy. i do not think this will happen, as wrong policies only change with a change of personnel. There have been studies about this, and people will continue down the same road no matter the results. Unfortunately what really happens is politicians spin everything and look to blame some one else. People in general seldom admit mistakes, looking in the mirror is not something very many people do, especially people in power, they think it shows weakness, when actually it shows strength of character. So I could vote for some one that says his policy was wrong and truly wants to amend it. Won't happen though, we do not have leaders with that strength of character. We have politicians that want to stay in power, not do what is right. David Huber on 6/4/2012 10:07:06 AM

I might. At question would be his competence. He would have to explain several things: (1) Why was the failed plan a reasonable thing to try in the first place, (2) Why did it not work-explain how his original thinking was flawed, and (3) What does he want to try now and why should we be optimistic about its outcome. I would not give him many "honesty points" for admitting the error; it would all be about selecting the person who has the most rational plan for going forward. Rick Hathaway on 6/4/2012 10:20:34 AM

I absolutely would vote for someone who can publicly come out and admit that something they wanted wasn't working. How refreshing it would be for an honest statement to come out of the most hypocritical, lying and corrupt bunch of self important, self serving people on the planet. Patricia on 6/4/2012 10:34:26 AM

The sheer notion that a politician would be honest, human and admit being wrong is what is wrong with much of America today. Especialy the presidency and congress and the entitlement teflon umbreella they live under, over and within. The you can't touch me attitude and the BS surending the cable media is nausiating. And us Americans continue to wake up, got to work and do the same thing tomorrow just to keep a decent roof and protection over heads and a decent meal to sustain ourselves. I don't recognize this country anymore! Nery Ragno on 6/4/2012 10:36:25 AM

Yes I could vote for that person if they could make the case of what caused their change and how the new policy would help. In our world wide economy things can change that are beyond our control and we need to be able to adjust. Any business that can't do this will probably go broke. Mike McDonald on 6/4/2012 10:47:04 AM

No, particularly if he didn't have a sound and sincere economic initiative plan to stimulate growth. Grace on 6/4/2012 11:08:25 AM

I certainly would. Do not expect this to happen with the current Administration. After all, he is the Messiah, and, as such, can never be wrong. Robert Kozel on 6/4/2012 11:32:12 AM

I think if I had been for his policies to begin with and then he had to say they weren't working as well as WE thought they would, then I would feel badly for him and for me, and would cast my vote for him to do the tweaking. But, for those of us that didn't like the policy to begin with and saw what the outcome would be regardless of all the QEs etc. that tried to tweak things and change the outcome, we can't imagine why anyone would vote for him. But, vote for him they will. They won't blame the guy who chooses to stop for a few beers and hurry home for his favorite tv show, because they are him. All if us are the product of the choices we have made. Some of us do have few resources are inflicted with disabilities, for them I feel compassion and charity, but most of us could have so much more if we had just made a few different choices. But those who can't accept their responsibility for those choices, those millions, will vote him. I don't believe they are 99%, but those who call themselves the 99% fight back with their own brand of righteous indignation and will continue to vote for him. Sad, sad, sad. Charles, you are such a great writer. I wish you would try a novel. You are a great motivator. Fran Touchette on 6/4/2012 11:49:17 AM

yes there are slackers everywhere. However, more kids are graduating high school now. The problem is that education has not kept up with the changing nature of jobs. A strong back is not enough. Look at the percentage of applicants the military refuses; http://www.joannejacobs.com/2010/12/army-rejects-20-of-high-school-grads/ The actual grad rate has increased slowly but definitely.... http://www.huffingtonpost.com/2012/03/19/report-us-makes-modest-ga_n_1360131.html paulo on 6/4/2012 11:52:32 AM

When an orchestra produces cacophony rather than symphony, it's time to fire the maestro. No amount of practice after the concert can restore shattered expectations. It's too late to ask for a do-over when your promised results are over due. george on 6/4/2012 12:10:26 PM

Where do you find honest politicians like that? they are just not made anymore. Daniel Koshak on 6/4/2012 12:11:30 PM

Truth gets my vote. Someone who can own a mistake, recognize the need for a change in course and say so sounds great. Patricia Flynn on 6/4/2012 3:20:19 PM

NO, He promised me one thing mow he is changing it. Not without s good explanation. Obama can't justify it. He is in way over his head. He should just tell DNC I'm not running for 2nd term. But his ego won't let him Bob Medkeff on 6/4/2012 3:51:05 PM

Yes, if they start going in the new direction before the election. I won't take their word for it. Tamara on 6/4/2012 8:08:54 PM

I wonder if you are asking question, or should I say asking about the right process. A great manager (which is what we want running the country in Congress and the White House) does not always have the answer up front. BUT, every plan he makes should have contingencies and adjustments built into it from the start. And those contingencies and adjustments must have explicit metrics to determine when they kick in. It is only through explicit goals and metrics that anyone knows when they are missing the mark. I would not feel good voting for anyone who admitted he was wrong based on metrics he created after the fact. The same applies in business. We see way too many S&P100 corporations run by lousy managers who will not state the metrics up front by which their performance is to be measured. And we see others which will state the metrics up front, then ignore them when they fail to be met. Those CEOs and their wimpy boards who won't take action should both be kicked into the unemployment lines, just like most of our D.C. residents. Bob G on 6/5/2012 4:07:19 AM

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