Monday, October 1, 2012

This is Austerity?

Why are France and Spain (and everywhere else in Europe) in deep fiscal trouble?  -- Too many promises by government without any plans to come up with the money to pay for the promises.

So, what are France and Spain doing?  Spain's recently proposed 'austerity' budget includes a one percent increase across the board to pensioners.  Paying pensions is Spain's number one government expense.  So, why not make it even higher?  How about France?  Newly elected Socialist President Francois Hollande took quick action to move France's retirement age to 60 from 62.  He may as well have moved it to 40 for what little chance France has of paying future retirees.

No austerity plan in Europe touches things like retirement, public employee largesse, and laws that mandate hours and rule out employee terminations.  So, in reality, nothing of any real significance is taking place except that the Eurozone is taking on more debt and rolling the printing presses.

You wonder why anyone thinks that anyone should work at all?  Why not simply print Euros and Dollars and everything will be fine.  That seems to be the mindset in Washington and Brussels.