Dr. Michael Benarroch, who became Dean of the Asper School of Business at the University of Manitoba just over a year ago, says that "Europe needs extreme structural reform in the long term in order to fix its economic woes, noting that its significant debt has been "created over along period of time."
Benarroch, who was born in Morocco and came with his parents to Canada at age four in 1963, gave the keynote address at a business luncheon put on by the Winnipeg Chapter Hebrew of the Canadian Friends of the Hebrew University and the Order of Sons of Italy, Girabaldi Lodge at the Fort Gary Hotel attended by 190 people. The luncheon was the first of its kind, and organizer Sharon Zalik, Executive Director of the Canadian Friends of the Hebrew University's Winnipeg Chapter, was especially pleased with the large turn out.
"The economic crises has been a challenge to the market economy," Benarroch told the luncheon attendees.
Benarroch noted that he had visited Paris in the summer and noticed that the city had made a beach by trucking in sand, next to a river. "This is a lifestyle issue," he said, noting that Europe has gotten used to the governments' taking these types of measures, but "this path is no longer sustainable."
According to Benarroch, from the moment the European monetary union was formed, "a number of countries didn't meet the requirements," specifically Greece and Portugal.
As Benarroch emphasized, "When forming a union [of countries], the exchange rate is set outside of [any given individual] country," meaning that individual countries in the EU, such as Greece, "lose control" over setting their own interest rates. When the financial crisis hit Europe, Greece couldn't afford to pay its debt anymore.
"For Greece to declare bankruptcy, it would have to leave the EU", Benarroch said.
He added that "currently Greece has 25% unemployment, similar to the unemployment rate for the great depression."
In Benarroch's view, "the solution is political," and the "preferred solution is to keep the EU together", which will take " a concerted effort of all countries," but the problem is that "they can't politically agree."
Europe will need to see what it costs to keep Greece in the Union, he said.
"A few countries, such as Germany, believe that if you bail out an economy, you create a solution whereby that country will remain that way [unreformed]."
Benarroch noted that in Canada's case, Liberal "Paul Martin decided he'd pay our debt down...Paul Martin put a freeze on spending, raised fees, shifted resources. Canada went through 16 years where we paid down our debt."
The luncheon was bought to an end when MC Joe Leuzzi, who thanked Benarroch, quipped "We have to leave this lunch so we can get back to work since we don't want to be like Europe."
The net proceeds of the lunch were to be donated to the Asper School of Business.
Prior to Benarroch's talk, Justin Bova, on behalf of the Order of Sons of Italy gave opening remarks. Justin's father Joe Bova was honoured by the Winnipeg Chapter of the Canadian Friends of Hebrew University last year.
Justin noted that the "trade relationship between Israel and Italy has never been better." In 2010 Italy overtook Germany and became Israel’s second largest trade partner in the fields of science and technology, after the United States.
Italy sees Israel as an important source for innovation. Italy can offer Israelis a bridge to boost participation in European markets as well as access to markets traditionally closed to Israelis, such as North Africa and the Persian Gulf.
Bova noted that Israel is one of the largest importers of Italian food and wine.
He added that he hoped the Jewish and Italian communities here "would continue to build bridges." He added that the two communities stand together in their fight against FASD. Proceeds from the event in honour of Bova's father were directed towards collaborative research between Hebrew University and University of Manitoba researchers working on FASD [Fetal Alcohol Spectrum Disorder].
Faith Kaplan, immediate past president of the Winnipeg Chapter of Canadian Friends of Hebrew University, delivered greetings on behalf of Chapter president Margaret Shuckett, who was out of town on a Hebrew University Live and Learn mission. Kaplan provided the audience with an overview of Canadian Friends' mission and long history in Winnipeg, and introduced Dean Benarroch.
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