Free Republic

The left-wing Socialist party is expected to seize the largest gains in September's Dutch elections, threatening to deprive German Chancellor Angela Merkel of one of her closest allies in response to the eurozone debt crisis. With Dutch voters set to go to the polls on 12 September 12, opinion polls indicated that the Socialist party, which has never formed part of a government, is running marginally ahead of caretaker Prime Minister Mark Rutte's Liberal party (VVD). … The Socialist party is more euroskeptic than the mainstream Dutch parties, leading opposition to the ill-fated Constitutional Treaty, which was defeated in a...

...Today, the shoe, as they say, is on the other foot. The debt owed by Greece is in the neighbourhood of US $345 billion (reports vary). The likelihood of eventual repayment is very slim indeed. And, not surprisingly, the Greek people feel the same way the German people did following the signing of the Treaty of Versailles. Correspondingly, events in Greece bear similarities to those seen in Germany in the 1920's. So, will we be looking at a repeat of Weimar Germany for Greece in the coming years? The first developments will most assuredly occur in connection with the new...

The government on Monday passed a sweeping measure to tighten Israel's belt at a time when the world is facing another global financial crisis. With a vote of 20 to 9, the Cabinet approved a package of austerity measures designed to raise some NIS 14.15 billion within a year, and reduce the budget deficit by 1.5 percent. Voting against the package were the Independence and Shas parties, as well as Likud Social Services Minister Moshe Kahlon. The measures include raising taxes, increasing fines and cutting budgets. Tax Hikes and Fines Extending the “temporary” order issued in February 2011 to raise...

Mariano Rajoy, the Spanish prime minister, has called for the eurozone to have “centralized control” over the budgets of all the countries using the euro. Rajoy has become the latest European politician to call for countries to, in effect, abandon their sovereignty in a last-ditch attempt to save the beleaguered currency. Rajoy said a new central authority would go a long way to alleviating Spain’s economic crisis as it would send a clear signal to investors that the single currency is an irreversible project. He said: “The European Union needs to reinforce its architecture. This entails moving towards more integration,...

Support for Spanish Prime Minister Mariano Rajoy fell sharply in July after his government announced a new round of deep spending cuts and tax hikes to fight the sovereign debt crisis, an opinion poll showed on Sunday. … Since Rajoy won the elections by a landslide last year, Spain has become the new front line of the 2½-year debt crisis, and the government has implemented several packages of structural reforms and austerity measures, the latest worth €65 billion ($80.4 billion) until 2014. … While 74 percent of the 1,000 people interviewed say they have a negative view of the government,...

Greece conceded on Thursday it had slipped "in some respects" in implementing the cuts and reforms demanded by lenders in exchange for saving Athens from bankruptcy, and tried to persuade them to cut the country some slack. Finance Minister Yannis Stournaras made the admission after meeting senior officials from Greece's "troika" of lenders from the EU, European Central Bank and International Monetary Fund, whose inspectors have begun picking through the country's books after weeks of political paralysis.

Here’s some good news from across the pond that a lot of Americans will like. Ireland is once again preparing to return international debt markets for the first time since 2010. For the Irish government, the timing is good; as the FT notes, Ireland could use the money:

(CBS News) ATHENS - Greece is broke, and it agreed to big cuts in government spending in return for a bailout by other European countries. However, because that austerity deal was so hated by Greeks, the government fell. The country will vote for a new parliament Sunday. The question is: Will a new government abandon the bailout agreement, undermining the euro currency and the European Union? Why would Greeks risk that? Dr. Chris Rokkas is a top cardiologist at Attikon hospital, but these days the U.S.-trained surgeon rarely sets foot in an operating room, which is bad news for Georgia...

Michael Tanner  As Greece, and now Spain and Italy, struggle with the crushing burden of debt brought on by the modern welfare state, perhaps we should shift our gaze some 1,200 miles north to see how austerity can actually work.Exhibit #1 is Estonia. This small Baltic nation recently had a spate of notoriety when its president, Toomas Ilves, got into a Twitter debate with Paul Krugman over the country's austerity policies. Krugman sneered at Estonia as the "poster child for austerity defenders," remarking of the nation’s recovery from recession, "this is what passes for economic triumph?" In return, President...

Governments should be more honest about the size of their debts and young voters would be wise to get politicians to pay them off as soon as possible. The critics of Western democracy are right to discern that something is amiss with our political institutions. The most obvious symptom of the malaise is the huge debts we have managed to accumulate in recent decades, which - unlike in the past - cannot largely be blamed on wars. According to the International Monetary Fund, the gross government debt of Greece this year will reach 153% of GDP. For Italy the figure...

Young people should welcome austerity measures because it means huge government debts are less likely to blight their futures, historian Niall Ferguson has said. The economic historian, who is affiliated to Oxford and Harvard Universities, says wise young voters should insist politicians pay off debts as soon as possible.... “It is surprisingly easy to win the support of young voters for policies that would ultimately make matters even worse for them, like maintaining defined benefit pensions for public employees,” ... He adds: "If young Americans knew what was good for them, they would all be in the Tea Party." Professor...

Europe owes a lot to Greece. Not least for the inspiration that it has drawn pursuing human excellence throughout history to emerge as probably the most civilized part of the world, but perhaps still more for actually remaining free to this day through its heroic stand against Germany’s unprovoked aggression during the Second World War.

Western governments clothe their irresponsibility in misleading words. Who would not prefer “growth” to “austerity”? That is the false dichotomy that insolvent Western governments, both here and abroad, are now constructing. After all, everyone prefers growing things to starving them. Yet in truth, there is no such clear-cut choice. In other words, “austerity” is a lie. For all the talk of terrible hardship and suffering, most of insolvent southern Europe still enjoys entitlements undreamed of by prior generations. When the French lamented that they were being squeezed to death by postponing retirement, they meant to age 62 rather than 60...

One of the great absurdities of our modern financial system is that a nation living within its means, i.e. spending less than what it confiscates in tax revenue, is no longer the norm. Living within your means is now considered ‘austerity’. And unfair. Whether in the UK, Europe, or North America, many voters have become so accustomed to the government’s massive role in the economy, they can’t begin to imagine how it could be scaled back. You usually hear heavy objections from people like– “What about roads? If we start cutting budgets, there would be no more roads!” The ‘road...

In Madrid you see them on the streets, jobless, aimless, often bearing college degrees but working as cabbies, baristas, street performers, or—more often—not at all. In Spain as in Greece, nearly half of the adults under 25 don’t work. Call them the screwed generation, the victims of expansive welfare states and the massive structural debt charged by their parents. In virtually every developed country, and increasingly in developing ones, they include not only the usual victims, the undereducated and recent immigrants, but also the college-educated.

Warning, tighten your belts, America’s new Age of Austerity is already here, today. There I said it. I admit it. And you better too. Prepare now. Could be like the 1930s depression austerity. You’ve seen the warnings all across the major newspapers about a global slowdown. But why no warnings of austerity dead ahead? Why? America’s still deep in denial. We prefer happy talk to the truth. No, nobody will get honest about austerity till after the elections. Then it’ll hit hard. Wake up. You were warned: America’s new Age of Austerity is already here. Till the elections, nobody else...

If you listen to those on the political left, you will think that the ongoing meltdown in the euro zone proves that spending cuts are driving the world into another Great Depression. Paul Krugman called the fiscal retrenchment “criminal folly,” while the famous British journalist Polly Toynbee affirmed that “the great austerity experiment has failed.” Adopting this view, at their recent Camp David summit meeting, leaders of the G8 nations agreed to pursue growth and job creation ahead of deficit reduction. On the other side of the ideological divide, there are those who say that austerity did not fail, because...

Global economic recovery will be slow and bumpy over the coming years, a senior economist from Vanguard told financial services professionals in Hamilton yesterday. Speaking at the Vanguard 2012 Bermuda Investment Forum at the Fairmont Hamilton Princess, Roger Aligia-Diaz highlighted several headwinds facing the economy including the European sovereign debt crisis, high oil prices, a slowdown in China and the “fiscal cliff” facing the US at the end of this year. Although Mr Aligia-Diaz warned his audience that his message might appear depressing, the presentation was cautiously optimistic, indicating that growth was happening and was likely to continue. Vanguard, which...

Western states are no longer able to repay its debt. Overwhelmingly, the debt burden of a number of stakeholders is predicated on the existence of large-scale and long-term commitments that are at the core of the overall social contract prevalent in the Western world and beyond. The policy approaches employed thus far, whether ‘quantitative easing’ or ‘twisting’ have not helped lower the debt waters — indeed, they have made matters worse. Instead of ‘quantitative lowering’ of these waters, at least in the United States, private banks and corporations are using their excess liquidity to re-leverage at a feverish pace, thereby...

Italy's social fabric is being torn by recession and tensions are growing among its citizens, Prime Minister Mario Monti said on Sunday. Speaking to a group of students in the central Italian town of Arezzo, Monti urged Italians to stick together and "not give up" in the face of a shrinking economy and rising unemployment. Monti's technocrat government has imposed painful austerity measures since taking office last year, and in recent days ministers have responded to calls from politicians and the media to show more compassion for the plight of ordinary Italians. "The country is now marked by profound social...