On the last day of 2011, a headline in The Wall Street Journal read: “Spain Misses Deficit Target, Sets Cuts.” The cruel forces of poor economic logic were at work to welcome in the new year. The European Union has become a vicious circle of burgeoning debt leading to radical austerity measures, which in turn further weaken economic conditions and result in calls for still more damaging cuts in government s ...

By Kassandra at neurope.eu When, in late October, German Chancellor Angela Merkel and French President Nicolas Sarkozy agreed with the-then Greek Prime Minister George Papandreou to grant Greece the €110 billion mega-loan, the latter agreed, in return for the loan, to purchase military supplies from Germany and France, worth €10.5bn. The purchases made were to be in equal parts between Germany and France. T ...

Germany Questions Contract By SPIEGEL A huge arms deal is threatening to put French-German relations under strain. According to information obtained by SPIEGEL, France wants to deliver two to four new frigates to the Greek navy and to allow the highly indebted nation to postpone payment of the €300 million ($412 million) purchase price per ship for the next five years. A stealth frigate built by DCNS of Fra ...

Angela Merkel and Nicolas Sarkozy draw up package to counter debt crisis but will not reveal details before G20 summit By guardian. French President Nicolas Sarkozy and German chancellor Angela Merkel after meeting in Berlin to discuss how to confront the eurozone bank and debt crisis. Photograph: Martin Meissner/AP The leaders of France and Germany have announced that they are ready to recapitalise Europe' ...