The economic crisis continues to deepen in Europe.

Despite all the huffin' and puffin', the European Union (EU) crisis meeting in Brussels over the weekend was yet another failure.

Despite 'agreeing' on plans to allow EU bureaucrats to impose coordinated spending cuts on the increasingly angry people of Europe, the summit’s failure to agree on a rescue plan for the single currency did nothing to stabilise the increasingly chaotic finance markets.

While the corporate media devoted much of its attention to the 'split' between Great Britain and the EU, it went largely unnoticed that 'stress tests' conducted on the European banks, revealed a deteriorating picture. It hasn't gone so much from bad to worse but more worse to 'Danger! Impending collapse!'

The tests showed that the European banks had a shortfall of 115bn euros compared to 106bn euros in October. And the German banks were found to need double the amount of capital originally thought. It was a further indication that the crisis is now imposing itself on the German economy.

It should also be remembered that most of these banks have already been bailed out by trillions of public money.

The fundamental problem remains the same - the huge amount of debt strangling the life out of countries like Greece, Italy, Spain, Ireland and Portugal.

Many banks are exposed to loans to these countries and they do not have sufficient capital to handle a default, let alone the collapse of the euro.

The worse case scenario for finance capital is that these countries will default on these debts and simply exit the eurozone.

Indeed a Citigroup economist and former central banker Willem Buiter warned last week that a fully blown break-up of the eurozone could spell a global depression and "pandemonium".

" A break up would drag down not just the European banking system, but the north Atlantic financial system and the internationally exposed parts of the rest of the global banking system as well".

But the only 'solution' on offer is to impose even more austerity measures. Ordinary people will be squeezed and squeezed again to pay for a crisis that they weren't responsible for.

But further austerity measures will only accelerate Europe's plunge into depression. Years of austerity budgets have deflated demand and increased unemployment across Europe but the Brussels 'solution' is simply more of the same.

Even some of the more hardened neoliberal zealots are beginning to question the rationale for a 'solution' that only leads to further drop in demand, more job losses and increased debt levels. But the politicians have nothing else to offer - the SS Eurozone is heading for the iceberg and there's nothing they can do about it.

Of even more concern for the European bourgeoisie is that resistance to the austerity cuts continues to grow throughout Europe. A spectre is haunting Europe's rulers and that is the spectre of an organised movement that finally overthrows the rule of capital

Last week US military officer General Martin Dempsey admitted that he was "extraordinarily concerned" about the euro's survival and the prospect of more 'civil unrest in Europe'.

"The eurozone is at great risk," the chairman of the Joint Chiefs of Staff told the media. "We are extraordinarily concerned by the health and viability of the euro because in some ways we're exposed literally to contracts but also because of the potential of civil unrest and breakup of the union that has been forged over there."


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