Europe Must Choose Change, Or Settle Into Decline

Europe Must Choose Change, Or Settle Into Decline by Dan Steinbock, Difference Group

TODAY, Europe is struggling with a series of old and new challenges.

For half a decade, Europe has struggled with excessive debt (which remains excessively high), fiscal adjustment (which has failed to revive the continent), systemic banking vulnerabilities (which have not been nullified), and competitiveness challenges (which are worsening due to R&D cuts across the core economies).

The prime reason for the semblance of stability in Europe stems from the European Central Bank’s (ECB) record-low interest rates and rounds of quantitative easing (QE). Yet, the ECB’s policy tools are being exhausted.

What’s worse, growth is decelerating across all EU major economies, including the current “growth engines” — Germany...