[luspikals]

Can we trade leaders with Germany? Please...

http://www.ft.com/cms/s/0/1f011f36-8...44feabdc0.html

Germany focuses on cutting spending

By Ralph Atkins in Frankfurt and Peggy Hollinger in Aix-en-Provence

Published: July 4 2010 22:11 | Last updated: July 4 2010 22:11

Germany’s cabinet is poised this week to approve a 2011 budget as part of a four-year programme of public spending cuts meant to serve as an example to other European governments without jeopardising the country’s increasingly robust economic recovery.

Briefing papers for Wednesday’s cabinet meeting, released by Berlin on Sunday, argue that by curbing spending – rather than increasing taxes – the €80bn ($100.3bn, £66bn) savings programme would differ “fundamentally” from previous fiscal squeezes and offer “noticeable, better growth possibilities”.

The comments appeared aimed at heading off international criticism that German fiscal austerity would hit Europe’s growth prospects.

Germany’s economy is enjoying an industry-led growth spurt, with engineers rehiring workers and returning production almost to pre-crisis levels.

The stronger-than-expected growth and falls in unemployment were making it significantly easier for Germany to reduce its public sector deficit.

Jean-Claude Trichet, European Central Bank president, moved on Sunday to boost confidence in global economic prospects. He said: “It is clear we are experiencing a confirmed recovery, not just in the emerging world but also in the industrialised world.”

Mr Trichet also backed fiscal retrenchment by European governments. He told Rencontres économiques, an annual gathering of the world’s top economists at Aix-en-Provence, France: “We have to reinforce confidence and that means having budgetary policies that are balanced and sustainable in everyone’s eyes.” But growth was “not preordained” and structural economic reforms were “absolutely fundamental”.

His upbeat comments came in spite of signs last week that the global recovery was losing momentum, with manufacturing growth faltering in China and other parts of the world.

[fereupfer]

Germany’s economy is enjoying an industry-led growth spurt, with engineers rehiring workers and returning production almost to pre-crisis levels.

The stronger-than-expected growth and falls in unemployment were making it significantly easier for Germany to reduce its public sector deficit. We aren't there, yet. Our unemployment is still too high, we aren't experiencing stronger-than-expected growth. Get a grip, Regis. If Germany's cabinet told you to jump off a bridge, would you do that, too?