While Schroeder has pushed through powerful changes, he hasn t begun to tackle one of the worst German diseases the merciless rigidity of labor and housing markets. The Italians are proposing tax cuts actually exceeding those of France and Germany in coming years. Government spending is now in check, with a modest surplus expected this year. As throughout Europe, tooooooo much government is a problem. Euro-Zone Expansion Denmark has a key vote about replacing the krone with the euro on September 28.
Most polls have the proposal passing by a small margin.
It could also slow the European integration process. As many as 12 additional nations could join the 15-member European Union in the coming decade. Many politicians talk of an eventual United States of Europe, a phrase that draws anger from many nationalists. Many eastern European countries could benefit from European Union membership, but they must first revamp their economies. Hungary seems most likely to be invited in first.