Last weekend, hundreds of thousands of people across France marched in protest of living costs and deteriorating public services. Those marches were quickly overtaken by violent, masked groups who looted shops, set cars and buildings on fire, and clashed with police in cities including Paris, Marseille, Lyon, and Limoges.
Even though more than 2,000 people were arrested, police largely failed to contain the chaos in several cities.
But that chaos and destruction, says Glenn Beck, had “nothing to do with the schools” or any other valid grievance.
It has everything to do, he argues, with the budget the French Parliament was scheduled to vote on yesterday, although it ended up being postponed to a later date.
“The street was sending Paris a message before the vote, and the government is now stuck in a trap with no good door,” says Glenn.
He explains how cutting spending infuriates the mob because it means fewer services, but not cutting spending worsens the debt crisis, which also infuriates the mob.
“If they vote it down, the lenders get nervous and the interest rates climb. Then the borrowing costs rise. Then the jobs disappear, and everything costs more, which is exactly what the people are marching about in the first place, so either way somebody loses,” he says.
The best-case scenario, says Glenn, is they “agree on a budget” and vow to “pay this loan back,” even if it means financial constraints. If the meeting “falls apart,” however, he predicts a snowball effect, where lenders raise France’s borrowing costs, the government has to borrow even more just to cover its bills, rates climb farther, and the debt spiral spreads pressure across Europe while France’s ability to fund basic services keeps shrinking.
“That's Italy. That's Greece. That's Germany, and it's already starting. Their borrowing costs went up this month, and France now pays more to borrow than either of them,” says Glenn.
The third potential outcome is what will happen if the budget falls apart and nobody does anything about it. In this scenario, the European Central Bank will either step in with harsh conditions that make daily life even harder and fuel more unrest — or break its own rules to bail France out, which signals that the rules no longer matter and spreads the crisis further.
This should matter to Americans, says Glenn, because America is teetering on the same debt trap as France — spending more than it earns. And if lenders lose confidence in the U.S. the way they’re losing confidence in France, Americans will feel it in higher mortgage rates, higher car payments, and job losses.
To hear more, watch the video above.
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