Downgraded European Economies is a Punishment for Germany.

As the Eiffel Tower sits overlooking the Seine in the centre of Europe’s capital of love, it appears that Standard and Poor, the international credit rating agency, have fallen out of love with the French capital.  

Downgrading of nine European Union economies last week did not come as a surprise, per se, but remained a bitter blow, especially to the second largest Eurozone economy. Rating changes for nine countries highlights the need for new austerity measures, before introducing growth plans.

Perhaps this is the reason Britain remains unchanged in S&P’s poll: Cameron’s government moved quickly to introduce cuts and the fact that these measures have been undertaken without direction has been rewarded from the worldwide monetary agency.

Without doubt, Britain’s position is far from safe: while the short term consequences see a gain in GBP strength and trade prospects on an international scale, the intrinsically linked economies of Europe are a fragile set of dominos. A single collapse at this stage of the crisis could prove the kindling for an explosive series of economic shortcomings and bailouts.

Indeed, plans introduced to cancel 70% of Greece’s debt last Friday are but moves to buy time for the Euro and all related economies.

Whilst it is believed the move may help Greece to start to implement new means of recovery that will slowly abate the spread of financial interdependence, the wiping of such an astronomical figure from the central funds of Europe is equivalent to pulling the plug on a vast resource of wealth. With fewer countries classified AAA, the missing money could prove to be nigh on impossible to replace, meaning that it would undermine the significant advances made in industry over 2011.

Should such an econopocalyptic event pass, it is likely to trigger debt that cannot be undone within our lifetimes.

France’s image as one half of the economic megaforce upholding the Eurozone has now been shattered. Sarkozy’s right to stand on a podium alongside Merkel has been removed: former foes had been presenting a united front as the 17 countries that use the euro face their biggest crisis since World War II. Now, whilst a blow for the president, concerns should shift from where France went wrong to where Germany now finds itself.

Economically, Germany is on the precipice before the abyss. All of Europe looks to its €211 billion ($267.32 billion) contribution to the Eurozone rescue fund as a source of saviour. Although Luxembourg, Finland and the Netherlands all maintain their AAA rating in addition to Germany, the mother of the Rhineland is able to boast a donation to the Eurofund that is more than treble that of the other three combined.

Germany is once again isolated in the centre of countries that threaten it: no longer the supposed threat of invasion, but the threat of siphoning all the funds possible for ulterior economic issues.

Relative strengths and weaknesses of key economies have been realigned by the changes and Germany becomes more vulnerable to credit crisis the more that its own funds are charged with the duty not only of small periphery nations, such as Greece and Portugal, but large central blocs, as France and Italy.

Any increase in bailout costs comes from German pockets and this appears to be something that the German electorate may not bear with merely a customary grumble too much longer. This could lead to potential referendums on the amount Germany puts into the fund, or even on the Euro itself.

However, the cost of breaking up the Eurozone itself could be catastrophic as billions of Euros are lost in every area from trade to administration and all problems in between. In fact, the relative weakness of the surrounding economies at least makes German products more competitive, which means Berlin earns more capital.

All the same, the opinion of the voter would depend on the projection of their outlook. Germany, likely to reassert itself as the strongest economy before European counterparts could still see benefits from a break in the single unit currency within a decade or two. Markets would always seek the hub of enterprise and exports offered by the central state.

The risks of both cases are, unfortunately, war. Ironically, the Franco-German alliance now enters a turbulent stage wherein the two countries sit on the crux of imposing a disaster on the rest of the economy, continent and world.

Should Germany continue to support its Eurozone counterparts, there may emerge a sentiment of anger and resentment that would see a war break out due to a lack of appeasement. On the other hand, if Germany were to break its ties, it could grow strong amidst a state of turmoil and seek further expansion in order to capitalise on new found economic prospects. And who could say that such a route would be devastating – the application of German stratagems could provide economic balance further than its current boundaries. Or should Germany leave, other European countries may feel abandoned and declare action as a last ditch effort to prove their own flailing might in the face of German capitalist gains.

After all, one of the main contributing factors of the Second World War was the sheer amount of economic wealth that was drained from Germany by other European countries. But then, when have we ever learnt from history?

Sparkling over the night waters of the Seine, the Eiffel Tower appears an oversized, abandoned Christmas decoration, spreading little warmth to the heart of Paris, threatening to be washed away by the tide of debt on which it is founded.