Rehab, Euro Style

My June post (“Rehab Revistied”) continued the story I originally began in September 2010 (“Busting Out of Rehab”), where I compared our situation in the U.S. Economy to that of a drug addict forced into rehab against her will, only instead of being addicted to drugs the U.S. was addicted to debt. As we rejoin our story today, our U.S. addict is still struggling with her debt and deficit addictions, paying lip service to getting clean but so far still partying every night (at the Democratic Party that is), supplied by her Chinese pushers and some quiet little guy in the shadows named Ben. She would like to get back into serious rehab at the clinic, run by a bunch of supposedly reformed debt addicts from that Republican Party that ended a few years ago. (And what a party that was, by the way. Eight years long and more debt drugs than in all other parties before that combined!) But those guys are tee-totallers now, or at least they claim to be. They want our addict to not only go cold turkey on debt drugs, but to eat right and start exercising every day to get lean and fit and trim – and all at once and all right now! Of course, that kind of regiment might very well kill our addict in her fragile addicted state.

But as bad as things are for our American addict, her European party buddies are in even worse shape. That guy Greece is the worst of the bunch. He may live, but they’re going to have to amputate his legs if he’s to survive. That’s a shame, but he was never really a “player.” He just hung out on the periphery doing his best to party with the big boys. The real question is what will happen to the big core partyers of the group – Italy, Spain and Portugal. All three of them keep waking up in the gutter. Every time that happens, their big brothers, France and Germany, give them a good talking to. The addicts then promise to do better, and they pay lip service to that for a while. But it doesn’t last, and before long they are again waking up badly hung-over with some under-age Italian girl in a seedy condo owned by the head of some labor union.

Not long ago, the pushers started to think that maybe they will never get paid for all of the debt drugs they are supplying, so they started cutting back on the debt drugs they were willing to sell to Italy, Spain and Portugal. But without an organized, expensive and time-consuming rehab, these addicts are in no condition to suddenly cut back on their debt habits. To do so could quite literally kill them. Concerned for their survival, their big brothers (France and Germany) called in the family doctor, Dr. E. C. Bee. Like any good doctor, Dr. E. C. Bee’s first priority was to stabilize the patient. His only immediate option was to fill the gap left by the reluctant pushers, and to himself start supplying the addicts with the debt drugs that they so desperately need every day just to get out of bed in the morning.

This kept Italy, Spain and Portugal from going into fatal withdrawal, but France and Germany realized that it was not a good long term solution… although France really didn’t have a big problem with it. (After all, France is a casual debt partyer now and then – just a little debt “weed” on the weekends, not that crack debt stuff that the hard core partyers like.) But Germany… Germany HATED Dr. E. C. Bee supplying the addicts. After all, Germany never has more than one beer on a Saturday night, always staying WELL within the safe limit to drive home. (And don’t even get their little brother Slovakia started. Before they would even let him get his driver’s license they made him go completely stone-cold sober and join AA. Italy of all people had been part of the group that was so strict with him. Boy is he pissed!) Nevertheless, the truth was that old Doc E. C. Bee wasn’t really licensed to treat debt addicts anyways. In fact, the law specifically prohibited him from doing so. So France (and even little Slovakia) had to agree with Germany that they needed to bring in some new help.

They decided the answer was a new doctor just out of medical school. His full name is a European mouthful, so everyone just refers to him by his initials – Dr. EFSF. He’s a brand new doc, so he’s short on experience, but he has the best credentials and a brand new Euro440 billion medical center. Surely with that kind of dough behind him he could get Italy, Spain and Portugal clean and sober. Well, maybe not all the way, but at least better enough to hold down a job and be productive members of society again.

Only it turns out that there are two problems with that plan. First, the worst partyer of the bunch, Italy, seems a bit reluctant to check himself in to the new rehab clinic. He keeps promising to go, but so far he hasn’t actually made any concrete plans to do it. But the worse problem is that Dr. EFSF’s Euro440 billion won’t be enough. Getting the addicts through rehab is going to take more, a lot more, like maybe Euro2 TRILLION.

So once again France and Germany have to come up with a new plan. Officially everyone in the extended family is working on the plan “together,” but everyone knows that is just to keep up appearances for the American and Asian neighbors. France and Germany will decide, and (perhaps surprisingly or perhaps not) the latest plan that they are discussing would pull a page out of the old party playbook. Their new plan is for Dr. EFSF to start using massive amounts of the debt drugs for himself, probably from the Chinese pushers. In other words, if the doctor can’t cure the addicts, then the solution is to turn the doctor into an addict himself. What could go wrong?

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If we are lucky, this story will continue for years, perhaps even a decade or more, as the addicts go through the long, slow, painful and costly process of getting clean. Not completely clean, of course, but clean enough to be productive and at least healthy enough to be sustainable. Our addicts will never be able think about living it up like the last two decades (not for a generation at least), but with luck can at least recover enough to live a happy, although poorer and less exciting, life. That is if we are lucky. The alternatives are either the addicts can’t cut back and sober up enough to live sustainably, or else they try (or are forced) to go cold turkey before they are strong enough, and either course could be fatal.