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Most attention lately has been on Cyprus, Spain, and Italy. Long-time troubles have been brewing in Portugal and I have an update coming up shortly. First consider Underwater: The Netherlands Falls Prey to Economic Crisis.The Netherlands, Berlin's most important ally in pushing for greater budgetary discipline in Europe, has fallen into an economic crisis itself. The once exemplary economy is suffering from huge debts and a burst real estate bubble, which has stalled growth and endangered jobs. "Underwater" is a good description of the crisis in a country where large parts of the territory are below sea level. Ironically, the...

Eurozone Faces New Challenge As Portugal Blocks Cuts The eurozone crisis threatens to flare up again this week after Portugal's constitutional court blocked the country's planned austerity programme. By Philip Aldrick 07 Apr 2013 The single currency bloc has already been destabilised by Cyprus and now faces fresh uncertainty if Lisbon cannot find new savings to meet the conditions of its €78bn (£66bn) bail-out. Pedro Passos Coelho, Portugal’s prime minister, said last night that the rejection posed “serious obstacles and risks” to Portugal’s progress in meeting its bail-out commitments, but that it would “do everything to avoid a second rescue”....

However, of more immediate concern is how will the government now plug a hole of up to €1.3 billion in its €5.3 billion 2013 budget. A solution has, luckily, presented itself: bypass the unconstitutional provisions by paying government workers not in cash, but in government bills! From the WSJ: The Portuguese government is considering a plan to pay public workers and pensioners one month of their salary in treasury bills rather than cash after a high court ruled out wage cuts, a person familiar with the situation said Sunday. "This is one of the ideas being considered," the person said....

Portugal's prime minister said he will address the nation Sunday over a crisis triggered when the country's highest court ruled some of the unpopular pay cuts in this year's budget are unlawful, depriving the government of about 1.4 billion euros ($1.8 billion) of expected revenue. Pedro Passos Coelho will speak after his government said in a statement that the position taken by the Constitutional Court "places the country in serious difficulties in meeting obligations to which it is committed internationally and also the budgetary goals it must meet."

During the Great Depression criminals like Bonnie and Clyde, Willie Sutton, Pretty Boy Floyd, John Dillinger and Baby Face Nelson robbed banks. They attained some degree of folk hero status by sticking it to banks that some felt were responsible for the Depression era misery.  With liberal ideas firmly in the saddle, civilizing us, so to speak, we have come a long way from those dreary days. No longer would we applaud such criminals. Instead, today, we send them to Congress, or parliament, or the legislature, where governments try to achieve folk hero status by robbing banks and depositors alike....

Controversy has erupted over next Tuesday's European Parliament resolution "on eliminating gender stereotypes in the EU", meant to mark international women's day, after libertarian Swedish MEPs from the Pirate Party spotted the call for a ban in the small print. While not legally binding, the vote could be the first step towards European legislation as the EU's assembly increasingly flexes its political muscle within Europe's institutions.

"My time in the Obama administration turned out to be a deeply disillusioning experience." It was close to midnight on Jan. 20, 2009, and I was about to go to sleep when my iPhone beeped. There was a new text message. It was from Richard Holbrooke. It said, "Are you up, can you talk?" When I called, he told me that Barack Obama had asked him to serve as envoy for Afghanistan and Pakistan. He would work out of the State Department, and he wanted me to join his team. "No one knows this yet. Don't tell anyone. Well, maybe...

AFP - Hundreds of thousands of people took to the streets of Lisbon and other Portuguese cities Saturday to protest against the government's austerity measures aimed at rescuing the debt-hit eurozone nation. The rallies were organised by a non-political movement which claimed 500,000 marched in the country's capital and another 400,000 in the main northern city of Porto. There have been no official estimates of the crowds. But the mood of the crowd was clearly political, calling for new elections with banners declaring "Portugal to the polls!" and "If you fall asleep in a democracy, you wake up in a...

[I had to excerpt independent.co.uk, per FR rules. My paraphrase follows below, in italics].A man who claimed to be a former employee of the World Bank, the United Nations, and a professor in the United States has been proven to be a fraud after becoming a media celebrity for criticizing Portugal's austerity measures._____After we read this, we got in touch with Filipe Miranda, a former Planet Money intern who grew up in Portugal, and whose family still lives there. Here's Filipe's take:This guy came out of nowhere and spent about a month and a half hoodwinking the Portuguese elite. He...

Joe Biden confuses Poland with Portugal in latest embarrassing gaffe for the vice president By Nile Gardiner World Last updated: February 4th, 2013 Joe Biden is in Europe this week, meeting with leaders in Berlin, Paris and London. Tomorrow he drops by Downing Street to see David Cameron, and Nick Clegg is also on the agenda. Over the weekend the US vice president attended the Munich Security Conference where he delivered a speech on the Obama administration’s foreign policy, expressing a willingness to sit down in direct negotiations with the Iranian regime over its nuclear programme, an approach that can...

The Daily Telegraph has seen confidential spending proposals and internal documents planning an unprecedented propaganda blitz ahead of and during European elections in June 2014. Key to a new strategy will be “public opinion monitoring tools” to “identify at an early stage whether debates of political nature among followers in social media and blogs have the potential to attract media and citizens’ interest”. Spending on “qualitative media analysis” is to be increased by £1.7 million ($2.7 million), and while most of the money is to be found in existing budgets, an additional £787,000 ($1.24 million) will be need to be...

Israel's spate of settlement expansion around Jerusalem has increased again with the approval of 2,612 homes in a move likely to further inflame international criticism of Binyamin Netanyahu's government. Givat Hamatos, across the pre-1967 Green Line between southern Jerusalem and Bethlehem, will be the first new discrete settlement created since 1997. Critics say it will become part of a chain of settlements in the area, further impeding access between the two biblical cities. European diplomats in Jerusalem have warned that the construction of Givat Hamatos is a "game-changer" which could destroy the chance of a viable Palestinian state with East...

French officials angrily rejected a charge by The Economist on Friday that France was the "time-bomb at the heart of Europe", accusing the magazine of sensationalist journalism. The Economist's front cover showed seven loaves of "baguette" bread held together by a French tricolour with a lit fuse protruding from the centre. Its main article raised concerns that President Francois Hollande's economic reforms are not ambitious enough and so could jeopardise the future of the euro currency. "Unless Mr Hollande shows that he is genuinely committed to changing the path his country has been on for the past 30 years, France...

Palestine can count on about 12 Yes votes by EU countries when it tries to upgrade its UN status, in a move expected later this month. … A senior EU diplomat told this website the Union remains divided on the question, however. He noted that member states’ votes “will probably follow the same pattern as with UNESCO,” referring to a decision by the UN’s Paris-based cultural wing to admit Palestine as a member last year. At the time, 11 countries—Austria, Belgium, Cyprus, Finland, France, Greece, Ireland, Luxembourg, Malta, Slovenia and Spain—backed Palestine’s UNESCO bid. Another 11—Bulgaria, Denmark, Estonia, Hungary, Italy,...

Portugal's EDP-Energias de Portugal SA (EDP.LB) said Monday that it signed a €800 million ($1.04 billion) loan with Bank of China Ltd. The three-year loan has a margin of 350 basis points over the three-month Libor rate and will be used for general corporate purposes, EDP said in a statement. …

CATALONIA may be the catalyst for a renewed wave of separatism in the European Union, with Scotland and Flanders not far behind. The great paradox of the European Union, which is built on the concept of shared sovereignty, is that it lowers the stakes for regions to push for independence. While a post-national European Union may be emerging out of the euro zone crisis, with a drive for more fiscal union and more centralized control over national budgets and banks, the crisis has accelerated calls for independence from member countries’ richer regions, angry at having to finance poorer neighbors. Artur...

The president of the Portuguese Association of Archeological Research (APIA), Nuno Ribeiro, revealed Monday having found rock art on the island of Terceira, supporting his believe that human occupation of the Azores predates the arrival of the Portuguese by many thousands of years, Lusa reported. "We have found a rock art site with representations we believe can be dated back to the Bronze Age," Ribeiro told Lusa in Ponta Delgada, at a presentation in University of the Azores on the topic of early human occupation of the Azores. The oldest cave art known in Europe is of prehistoric origin, dating...

Nick Clegg clashed with the Prime Minister today after criticising plans to claw back powers from the EU. The Deputy Prime Minister said that only 'populists, chauvinists and demagogues' could benefit from a treaty negotiation, even though David Cameron yesterday re-affirmed his intention to repatriate powers. Mr Clegg warned that European politicians should focus on 'jobs and growth' rather than attempting to reform EU institutions. Read more: http://www.dailymail.co.uk/news/article-2061798/EU-treaty-change-Nick-Clegg-clashes-David-Cameron-reform.html#ixzz1dnt5E4wa

--PM says measures will help tackle high unemployment --Portugal must cut budget deficit to 4.5% this year, 3% next --Opposition parties criticize more austerity LISBON--Portuguese Prime Minister Pedro Passos Coelho announced late Friday new measures he will impose next year to meet budget-deficit targets and tackle a sharp rise in unemployment. In a televised statement, Mr. Passos Coelho said he will increase the social-security contribution from employees to 18% from 11%, while cutting the same payment companies make to the state to 18% from 23.75%. "We will reduce substantially the costs of labor, providing incentives to investment and job creation,"...

New cars and vans in the European Union will produce one-third less carbon dioxide within eight years, under proposed new rules set out on Wednesday (11 July) in Brussels. By 2020, the average emissions from new cars will have to be no more than 95 grams of carbon dioxide per kilometer driven (5.4 oz/mile), a cut of more than 40 grams from today's levels and of 35 grams per kilometer compared with the 2015 target, if the proposed new regulations are accepted. Connie Hedegaard, climate chief of the European commission, said the goals were "ambitious but achievable" and would benefit...