Are you watching Europe implode?

[StageLeft]

I created the Greece thread, but this is now clearly beyond Greece. Greece's "implosion" has had a stay of execution by a sizable bailout, the strings attached to it being substantial austerity measures imposed primarily on the public sector (pay cuts, for example).

Forgive the singularity of my source, but Telegraph is not a fly by night, so with that:

Spain cuts public-sector wages by 5%, among other things
http://www.telegraph.co.uk/finance/...udget-primacy-over-sovereign-parliaments.html

New austerity coming down the pike from Portugal (scant on specifics)
http://www.telegraph.co.uk/finance/...gal-takes-it-punishment-with-fresh-taxes.html

Ireland surely isn't far behind. These countries have already suffered hugely from the recession, and the austerity measures, which realistically are needed (IMO), are going to put them close to or into something more resembling a depression (though I think a modern-day depression is far less depressing than one 80 years ago).

Many feel the European Union experiment is approaching its zenith.

 

[nick1985]

Nations burdened by entitlements collapsing on themselves?

I'm shocked.

 

[Sinsear]

Spain:

The country’s €2,500 baby bonus will be cancelled.

WTF is a baby bonus?


Portugal:

Socialist premier Jose Socrates aims to cut the deficit by an extra 1pc of GDP to 7.3pc this year and 4.6pc next year, but has refused to follow yesterday’s move by Spain for broad-based cuts in public wages owing to constitutional constraints.
The package relies on revenues, including a rise in VAT to 21pc, higher income tax, and a range of corporate levies.

21% VAT? Wowo.

 

[StageLeft]

Spain:



WTF is a baby bonus?


Portugal:




21% VAT? Wowo.

I guess it's 2500 euro for not pulling out. I thought it sounded silly but then remembered that (and this doesn't invalidate its sound) I get $1k/year for each of my kids in tax credit, too.

 

[IndyColtsFan]

WTF is a baby bonus?

Some countries in Europe have a negative birth rate. I am not sure if Spain is one (too lazy to look), but if they are, they might be trying to get people to have kids by paying them that bonus.

Yes, it is a dumb idea. No wonder these guys are having a financial meltdown.

 

[jackace]

Nations burdened by entitlements collapsing on themselves?

I'm shocked.

We, the US, are not any better. We just give the money to big business and wall st not to the general population.

 

[spidey07]

We, the US, are not any better. We just give the money to big business and wall st not to the general population.

Negative. The hugest part of the budget is entitlements like social security, medicare/medicaid and welfare. This is why we're next. We're trying to follow in the proven failures of socialism as can be seen in Eurpope.

 

[jackace]

Negative. The hugest part of the budget is entitlements like social security, medicare/medicaid and welfare. This is why we're next. We're trying to follow in the proven failures of socialism as can be seen in Eurpope.

Over the last 50 years you are right, but over the last 2-3 years wall st has been given HUGE sums of money and continues to be given money everyday. When they can borrow money from the government at almost 0% and turn around and loan that money back to the government at 3-4% that's a handout, entitlement, etc for wall st.

 

[Zedtom]

Negative. The hugest part of the budget is entitlements like social security, medicare/medicaid and welfare. This is why we're next. We're trying to follow in the proven failures of socialism as can be seen in Europe.

During FY 2009, the federal government spent nearly $3.52 trillion on a budget or cash basis, up 18% versus FY2008 spend of $2.97 trillion. Primary expenditure categories (shown in the pie chart in the introduction above) include: Defense and Homeland Security ($782B or 23%), Social Security ($678B or 20%), and Medicare & Medicaid ($676B or 19%).-from Wikipedia

The military and defense industry would not like to be considered socialists.

 

[MovingTarget]

Some countries in Europe have a negative birth rate. I am not sure if Spain is one (too lazy to look), but if they are, they might be trying to get people to have kids by paying them that bonus.

Yes, it is a dumb idea. No wonder these guys are having a financial meltdown.

I hate to play devil's advocate, but in a country with a low birth rate, such a 'bonus' could be a long-term financial gain if it increases the future tax base... It depends on how it is implemented.

 

[Rebel44]

IMO USA with its current deficits dont deserve AAA rating either, so I dont see any reason why every1 should panic about few countries in EU when UK and USA are not that far from being in same spot as Greece.

 

[JS80]

lol they think raising taxes will raise revenue.

 

[sandorski]

The timing for these Austerity measures is bad, but the situation seems to warrant it. Too many Nations have squandered the Good Economic Times, where they should have fixed their systemic fiscal issues, and now it's time to pay the piper.

 

[werepossum]

Spain:



WTF is a baby bonus?


Portugal:




21% VAT? Wowo.

21% VAT PLUS an income tax. Wow indeed.

 

[bfdd]

During FY 2009, the federal government spent nearly $3.52 trillion on a budget or cash basis, up 18% versus FY2008 spend of $2.97 trillion. Primary expenditure categories (shown in the pie chart in the introduction above) include: Defense and Homeland Security ($782B or 23%), Social Security ($678B or 20%), and Medicare & Medicaid ($676B or 19%).-from Wikipedia

The military and defense industry would not like to be considered socialists.

Your post didn't discredit what he said, he lumped the "socialist" programs into one group and said we spend more on those than anything else, which is true. Medicare/Medicaid + Social Security budget > defense budget

 

[Greenman]

All of this points out the basic flaw in democracy, whoever gives away the most money, wins elections. I honestly think they will continue spending until they suffer a total collapse. In the aftermath of that event, they'll elect someone that will promise to bring prosperity through government spending.

 

[werepossum]

All of this points out the basic flaw in democracy, whoever gives away the most money, wins elections. I honestly think they will continue spending until they suffer a total collapse. In the aftermath of that event, they'll elect someone that will promise to bring prosperity through government spending.

Quite probably true. The beauty of democracy is that you ALWAYS get the government you deserve.

 

[spidey07]

All of this points out the basic flaw in democracy, whoever gives away the most money, wins elections. I honestly think they will continue spending until they suffer a total collapse. In the aftermath of that event, they'll elect someone that will promise to bring prosperity through government spending.

That's why the US needs to remain a republic. That whole idea has been lost however.

The only hope we have is the republic. But look at the states with the most electoral votes/house seats. They are the one failing and they have the biggest impact. The good news is business and people are fleeing those states.

That's the great thing about our union. You can move to another state when you've had enough.

 

[Pulsar]

21% VAT PLUS an income tax. Wow indeed.

Why are you saying wow?

It's pretty common for the total taxation amount to approach 60% in European countries.

Just remember that next time says "Let's be like Europe". How the hell do you think they finance all that cool stuff, like government enforced vacation periods, maternity leaves for fathers, etc.

 

[SamurAchzar]

All of this points out the basic flaw in democracy, whoever gives away the most money, wins elections. I honestly think they will continue spending until they suffer a total collapse. In the aftermath of that event, they'll elect someone that will promise to bring prosperity through government spending.

Exactly. Fortunately in the US there is still a strong anti-government movement.
I hope it will be strong to weather the storm..

 

[sandorski]

Why are you saying wow?

It's pretty common for the total taxation amount to approach 60% in European countries.

Just remember that next time says "Let's be like Europe". How the hell do you think they finance all that cool stuff, like government enforced vacation periods, maternity leaves for fathers, etc.

Nice Strawman, no one says that.

 

[Jhhnn]

Your post didn't discredit what he said, he lumped the "socialist" programs into one group and said we spend more on those than anything else, which is true. Medicare/Medicaid + Social Security budget > defense budget

SS has been a giant regressive cash cow for 25 years, still is, with the Trust being owed ~$3T by Uncle Sugar. Direct welfare payments are an extremely small part of the federal budget, and, hey, Righties pandered senior votes with the senior drug benefit, along with huge campaign contributions from big Pharma who benefits as a result...

What's wrong with Europe is what's wrong with America, too- governmental reliance on financial sector flimflams to create the illusion of prosperity as the world's financial elite continues with their looting spree... If they implode, we'll be right behind 'em... World economy, international banking, multinational corporations, remember?

 

[sandorski]

Exactly. Fortunately in the US there is still a strong anti-government movement.
I hope it will be strong to weather the storm..

Not fortunate at all and it in fact is one of the main reasons the US is in a similar situation. Anti-Government types have dismissed the Government altogether and force the Government to take positions(like never ending increased Tax Cuts)that ultimately Increase the Deficit/Debt. There is a place in Society for Government and that place is far bigger than the Minimalists can see.

The solution is not to Oppose Government, it is to make Government better. Those who simply Oppose put Government into a position where it can only function through irresponsible Fiscal Management.

 

[Jhhnn]

Not fortunate at all and it in fact is one of the main reasons the US is in a similar situation. Anti-Government types have dismissed the Government altogether and force the Government to take positions(like never ending increased Tax Cuts)that ultimately Increase the Deficit/Debt. There is a place in Society for Government and that place is far bigger than the Minimalists can see.

The solution is not to Oppose Government, it is to make Government better. Those who simply Oppose put Government into a position where it can only function through irresponsible Fiscal Management.

Well, yeh, of course. Republicans see govt as incompetent, and when they're running it or have the power to stop it from functioning, it is incompetent... wrapping themselves in Old Glory and faux patriotism at the same time. If the leadership sees the base as incompetent chumps, it's because the base keeps falling for the same shuck and jive, over and over again...

 

[Jaskalas]

Many feel the European Union experiment is approaching its zenith.

So is that United States experiment, and for the same reason!

Granted, we've a 200 year history together so we won't pull out at the first sign of trouble, but all ropes have their end. Entitlements collapsing has got to leave one hell of a mark on a nation.