France’s civil Maginot Line has just been crossed. The government has essentially fallen.

Massive budget deficits, way over European Union limits, forced the Macron government to propose spending cuts to get their deficit below 5 percent of GDP from more than 6 percent. That was, however, enough to unify the hard right and left in opposition. The center is nowhere to be found.

France, Europe’s second-largest economy, is now adrift in a sea of uncertainty. Both equity and credit markets are suffering and the bottom is not in sight.

Northeast of France, Germany is in the throes of an industrial nightmare. Two economic stalwarts, automaker Volkswagen and steel fabricator Thyssenkrupp, are shedding workers and threatening plant closures. In the case of Volkswagen, this is something unseen in the 87-year history of the company. Workers just staged a practice two-hour strike and threatened far longer ones unless planned job cuts and wage rollbacks are rescinded.

At least the German annual budget deficit is under 3 percent, so the actions do not threaten borrowing costs.

What is behind this industrial discontent with its very serious political ramifications are several factors, all of which point to the day of reckoning coming soon.

First, Europe has been in a slow-growth mode for well over a decade, lagging far behind Asia and especially China. Even compared to the U.S., the continent has consistently experienced lower growth coming in around 0.9 percent annually over the last decade.

The European........

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