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Thousands Protest Austerity Measures in Spain and Portugal

Guy Incognito

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Tens of thousands of people from all over Spainrallied in the capital on Saturday against punishing austerity measures enacted by the government, which is trying to save the country from financial collapse.

http://www.nytimes.com/2012/09/16/w...usterity-protests-in-spain-portugal.html?_r=0


It's a tragic irony, really. The only way to fix the economy is austerity, but the people are like junkies. What's happening in Southern Europe is a microcosm of the entire economic crisis. People will never learn...
 
It's a tragic irony, really. The only way to fix the economy is austerity, but the people are like junkies. What's happening in Southern Europe is a microcosm of the entire economic crisis. People will never learn...

*Coming to a neighborhood near you.* ;)
 
It's a tragic irony, really. The only way to fix the economy is austerity, but the people are like junkies. What's happening in Southern Europe is a microcosm of the entire economic crisis. People will never learn...

No, it's not the only way.

The government could default on the loans they borrowed.
 
It's a tragic irony, really. The only way to fix the economy is austerity, but the people are like junkies. What's happening in Southern Europe is a microcosm of the entire economic crisis. People will never learn...

Leave it to the moochers to think they are owed other people's money.
 
You really believe that would fix the economy?

I think it's an option.

I mean a lot of investors want the people to pay off the debt borrowed by these European governments. But those investors need to remember that all loans have a level if risk to them.

And with a default of that debt, the people won't have to pay back the principle or the rates. That way the people will have more money to spend on developing their economy rather than pay back government debt.

And one of the outrages by the European public, as I understand it, is that the pressure for austerity rather than default is being pushed by global banks - who were the ones who lent that money and want it paid back because they didn't do their homework on these loans.

So why should the people if Europe pay for the folly of global banks?
 
Austerity is not the only way to fix an economy.. It ultimately makes things worse in the long run.
 
It's a tragic irony, really. The only way to fix the economy is austerity, but the people are like junkies. What's happening in Southern Europe is a microcosm of the entire economic crisis. People will never learn...

Actually what's interesting is Spain ran 5 years of budget surpluses before the financial disaster. Now people are shaking their finger at Spain and saying "you crazy Spaniards need to live in your means!".
 
Austerity is not the only way to fix an economy.. It ultimately makes things worse in the long run.

Wrong..

Austerity during a recession or bad economic growth will not fix the economy.. but only make it worse.

Austerity during growth in the private sector and over all economic growth... the right way to do things.
 
Wrong..

Austerity during a recession or bad economic growth will not fix the economy.. but only make it worse.

Austerity during growth in the private sector and over all economic growth... the right way to do things.

If you try to cure this crisis by trying to pay back the debt all at the same time it shrinks the economy, when you shrink the economy drastically you reduce the amount of tax revenue you can collect, which means you reduce the amount of debt you can pay back.
 
Actually what's interesting is Spain ran 5 years of budget surpluses before the financial disaster. Now people are shaking their finger at Spain and saying "you crazy Spaniards need to live in your means!".

Yea and their debt load just hit 80%.... which aint that high relative to other nations.

Problem in Spain is not overspending but the construction sector melt down.. it was accounting for 30% of the economy and over night that poofed and with it a massive amount of tax revenue. For example in my area of Spain, the VAT tax revenue dropped 51% from 2007 to 2011 and we are a big tourist area and there has actually been steady growth in that industry.

Now I aint saying Spain did not have its problems despite the boom.. after all it was a bubble, and they did not address it despite knowing it was there.. much like the sub-prime disaster in the US.. but they also did not attempt to fix the structural problems in the country that everyone knew were there. Now they are being forced to do the changes and cut heavily in public spending.. which on a relative scale is and was not that high compared to many other countries... and that of course hurts a lot in an economic meltdown.
 
If you try to cure this crisis by trying to pay back the debt all at the same time it shrinks the economy, when you shrink the economy drastically you reduce the amount of tax revenue you can collect, which means you reduce the amount of debt you can pay back.

I agree, but more importantly, cutting spending in the public sector, while the private sector is also contracting.. is suicide. We saw this at the start of the big depression... hell it basically caused the great depression in many ways.
 
*sigh*

In short, the main probelm is that Spanish banks are bancrupting the country. Which is entirely the responsability of Spain.
 
I agree, but more importantly, cutting spending in the public sector, while the private sector is also contracting.. is suicide. We saw this at the start of the big depression... hell it basically caused the great depression in many ways.

I agree some cuts to public need (im guessing we differ on the degree of cuts that need to be made) the degree on the cuts to be made but austerity is not the way to fix this. As economists Mark Blyth stated that "All of the countries that have [gone] on austerity programs over the last two years — they now have more debt rather than less," Voters, Economists Agree: Austerity Not The Answer : NPR
 
I think it's an option.

I mean a lot of investors want the people to pay off the debt borrowed by these European governments. But those investors need to remember that all loans have a level if risk to them.

And with a default of that debt, the people won't have to pay back the principle or the rates. That way the people will have more money to spend on developing their economy rather than pay back government debt.

And one of the outrages by the European public, as I understand it, is that the pressure for austerity rather than default is being pushed by global banks - who were the ones who lent that money and want it paid back because they didn't do their homework on these loans.

So why should the people if Europe pay for the folly of global banks?

That's just kind of a sophomoric view that makes the phrase "penny wise, pound foolish" a colossal understatement.

Spain and Portugal, like the rest of the industrialized world, rely on outside investment. Both are already having a difficult enough time finding people to buy their bonds. Defaulting would practically guarantee a stop to all the money coming into these two countries and the government just wouldn't have enough to pay for essential services, pensions, or anything else.

Unfortunately, this really is just the end result of socialism.
 
Wrong..

Austerity during a recession or bad economic growth will not fix the economy.. but only make it worse.

Austerity during growth in the private sector and over all economic growth... the right way to do things.

It's not a matter of fixing European economies though.

It's a matter of keeping them solvent long enough so they can be fixed when the global economy picks up again.
 
That's just kind of a sophomoric view that makes the phrase "penny wise, pound foolish" a colossal understatement.

Spain and Portugal, like the rest of the industrialized world, rely on outside investment. Both are already having a difficult enough time finding people to buy their bonds. Defaulting would practically guarantee a stop to all the money coming into these two countries and the government just wouldn't have enough to pay for essential services, pensions, or anything else.

Unfortunately, this really is just the end result of socialism.

Iceland decided to do it.

And socialism doesn't have anything to do with this. Rather, it's corruption of government officials. Which are two separate issues.

I think if these European countries were to default on their loans and then implement anti-corruption reforms, outside investors would be more willing to loan them money in later years.
 
I think it's an option.

I mean a lot of investors want the people to pay off the debt borrowed by these European governments. But those investors need to remember that all loans have a level if risk to them.

And with a default of that debt, the people won't have to pay back the principle or the rates. That way the people will have more money to spend on developing their economy rather than pay back government debt.

And one of the outrages by the European public, as I understand it, is that the pressure for austerity rather than default is being pushed by global banks - who were the ones who lent that money and want it paid back because they didn't do their homework on these loans.

So why should the people if Europe pay for the folly of global banks?

Because people who borrow money have a contractual obligation to pay it back.
You're basically saying it's ok to strategically default, because they can.

Pretty cruddy morals there.
 
Iceland decided to do it.

And socialism doesn't have anything to do with this. Rather, it's corruption of government officials. Which are two separate issues.

I think if these European countries were to default on their loans and then implement anti-corruption reforms, outside investors would be more willing to loan them money in later years.

Why would anyone want to loan them money, when someone can rationalize defaulting again, using corruption or some other excuse?
 
Why would anyone want to loan them money, when someone can rationalize defaulting again, using corruption or some other excuse?

That decision is up to the individual investors.
 
Because people who borrow money have a contractual obligation to pay it back.
You're basically saying it's ok to strategically default, because they can.

Pretty cruddy morals there.

No, I'm saying it's okay to strategically default because it's the only way for them to continue as a society and spur on their economy.

Also, the politicians that borrowed that money and allocated those funds are not the same as the politicians in power now. Even so, it's the people who are being held accountable to pay those loans back.

Also, investors need to be more careful in who they loan money to.
 
They remind me of drug addicts going through withdrawal. Their government's can't sustain their unsustainable policies. They need to deal with that and quit acting like children.
 
No, I'm saying it's okay to strategically default because it's the only way for them to continue as a society and spur on their economy.

Also, the politicians that borrowed that money and allocated those funds are not the same as the politicians in power now. Even so, it's the people who are being held accountable to pay those loans back.

Also, investors need to be more careful in who they loan money to.

The people who elected them are, generally the same.
It's their responsibility to repay the debts.

You're just making scape goats for the peoples fiscal imprudence.
Putting all the responsibility on the lenders.
They can afford to pay it back, they just don't want to.
 
They remind me of drug addicts going through withdrawal. Their government's can't sustain their unsustainable policies. They need to deal with that and quit acting like children.

Which policies in particular of Spain and Portugal do you think are unsustainable?
 
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