NEWSMAX: …French President Nicolas Sarkozy lost the first round of his re-election bid and a revolt against extra spending cuts in the traditionally budget-conscious Netherlands propelled Prime Minister Mark Rutte’s coalition toward an early breakup.
Together with anti-austerity rumblings in a campaign for elections in Greece, the shift in grass-roots sentiment at the heart of Europe generated fresh doubts about the German-driven strategy for getting to grips with the two-year-old crisis.
“We have organized the track of discipline, that’s very good and we have to continue on that, but we need desperately also to organize the second track, the track of growth, solidarity, investment,” former Belgian Prime Minister Guy Verhofstadt, now a member of the European Parliament, said on Bloomberg Television’s “The Pulse.” … (more)
EDITOR: It is the same story in Europe as here: You cannot both impose austerity and climb out of a recession, although European leaders seem to believe otherwise. (See http://www.charlierose.com/view/interview/12309 To our thinking, the only panel member not whispering past the grave yard was Christina Romer, former Chair of the Council of Economic Advisers in the Obama administration. ) The European officials don’t even mention the possibility of allowing some countries to leave the Euro zone, which is an obviouis alternative to Draconian austerity and likely deep recession.
The USA enacted a major stimulus during the depth of recession and has subsequently leaned more towards deficit spending that balancing the budget. The result is we may be inching our way back to prosperity. Once prosperous again, disciplined efforts including higher taxes can pay down the debt.
