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Portugal to Raise Taxes in Bid to Cut Deficit Faster

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donsutherland1

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Another move toward addressing fiscal imbalances in the EU...

Bloomberg.com reported:

Portugal will cut wages of top government officials and temporarily raise taxes in a bid to narrow its budget deficit faster than previously planned to fight contagion from Greece’s fiscal woes.

The government approved increases in value-added, personal income and corporate taxes, Prime Minister Jose Socrates told a press conference in Lisbon today. He maintained the 2010 goal of a deficit of 7.3 percent of gross domestic product and lowered the 2011 target to 4.6 percent from 5.1 percent.
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Portugal to Raise Taxes in Bid to Cut Deficit Faster (Update1) - Bloomberg.com
 
good for mike pence

the european bailout protection act would:

"Prohibit any funds that have yet to be drawn by the IMF from being used to provide financing to any EU countries until all EU nations are in compliance with the debt to GDP ratio requirement in their own collective growth pact."

Right Now - Republicans introduce bill to prevent Euro bailout
 
Deuce said:
If only the American people could stomach this necessary step.
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If only the American government could stomach cutting the budget and allowing government to shrink. If the American people should stomach anything it should be reduced power to unions and less social spending, not higher taxes. The problem lies with the fiscal responsibility, so throwing more money at the same irresponsible congress and leaders won't fix the issue.
 
Deuce said:
If only the American people could stomach this necessary step.
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Unfortunately, even as austerity can be necessary, it can be difficult to carry out in democratic societies. It is difficult to persuade people to expect sacrifice even when sacrifice is necessary. Nonetheless, the U.S. will likely face a risk of a debt crisis down the road if the nation does not embark on a course that includes a combination of discretionary spending cuts, mandatory spending reforms, and tax hikes. Such a course will require genuine political courage. If the U.S. does not initiate such a program beginning as early as next year, it likely will be placed on negative outlook in the next year or two by the ratings agencies (IMO, something that should already have been done given the size of its structural deficits and absence of a credible plan for tackling those deficits, but such agencies are typically reactive when it comes to measuring risk).
 
The Prof said:
good for mike pence

the european bailout protection act would:

"Prohibit any funds that have yet to be drawn by the IMF from being used to provide financing to any EU countries until all EU nations are in compliance with the debt to GDP ratio requirement in their own collective growth pact."

Right Now - Republicans introduce bill to prevent Euro bailout
Click to expand...

While I agree that the Euro Zone's mess is largely of its own doing, I do not support this resolution for two reasons.
1) The United States should not be micromanaging the IMF in this way. It's an international body of which we are one member.
2) The United States should not be micromanaging the EU in this way. Frankly, it's none of Mike Pence's damn business WHAT debt/GDP ratio the EU requires...or if they even have a requirement at all.
 
oh, pence is posturing, his piece has no possibility

but politically, it paints them that are responsible as them that are responsible

live it, love it, it's YOURS!
 
I think this crisis might spell the end of the euro. Having a single unified monetary policy just doesn't work for nations that are unwilling to also have a single unified fiscal policy. It works in the United States because we have a strong federal government; the eurozone does not have that.

As long as the euro remains, I fear this will continue to happen every time the economy goes into a recession. The European Central Bank won't cut interest rates enough to satisfy the worst-performing members, which will prolong their recession. This will, in turn, cause them to accumulate more debt (if they can) or impose severe austerity measures which will hurt their economies even more.

As I see it, the economies of southern Europe probably need to abandon the euro...both for their own good and for the euro zone's. Maybe the euro can survive as a smaller currency union of France, Germany, Austria, Finland, and the Netherlands...but even a smaller union will have the same fundamental problem.
 
it IS an existential threat
 
Deuce said:
If only the American people could stomach this necessary step.
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Why don't liberals just send in more of their own money?
 
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