Dutch Government Collapses Over Debt Woes

[bronxboy10]

The Dutch Government has collapsed, elections to be scheduled soon:

http://www.usatoday.com/money/story/...pse/54483476/1

[Zippyjuan]

More and more reports from Europe suggesting that at least in the sort term, austerity (budget cutting) is not working. Unemployment continues to rise in some countries (Spain just officially was classified as back into a recession after negetive GDP for the first quarter) and deficits are not really coming down much either. So far a lot of pain and little gain.

Europe’s backlash against austerity gained momentum, in a challenge to German Chancellor Angela Merkel’s budget-cutting prescriptions for resolving the debt crisis.

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.”

The euro fell as bond investors moved money into Germany and out of the Netherlands, Belgium, Spain and Italy amid concern that a consensus over the crisis response is fraying. The yield on Germany’s five-year bond fell to a euro-era low of 0.61 percent while the premium that investors demand to hold Dutch bonds over bunds rose to the highest since 2009.

Political tensions coincided with a report of a greater- than-expected decline in services and factory output in April, equipping opponents of austerity with evidence that budget- cutting zeal may cast the 17-nation euro region into recession.

Route to Health

Northern European advocates of tight fiscal policies pointed to a separate report from the European statistics office showing that the aggregate debt of euro governments reached 8.2 trillion euros ($11 trillion) in 2011, the highest in the currency’s 13-year history.

Merkel, who has dominated Europe’s crisis response, said debt reduction is the best route to economic health.

“Solid budget management is a factor for producing growth, but of course not the only one,” Merkel said yesterday at the Hanover trade fair, a showcase for high-tech products. “We’re still in the process of overcoming this crisis.”

While that has pushed down German borrowing costs, other European countries are struggling to convince investors that austerity is the best route to political stability and financial health. Ten-year bond yields rose 3 basis points to 5.94 percent in Spain today and 6 basis points to 2.37 percent in the Netherlands.

http://www.bloomberg.com/news/2012-0...to-merkel.html

[Austrian Econ Disciple]

More and more reports from Europe suggesting that at least in the sort term, austerity (budget cutting) is not working. Unemployment continues to rise in some countries (Spain just officially was classified as back into a recession after negetive GDP for the first quarter) and deficits are not really coming down much either. So far a lot of pain and little gain.

http://www.bloomberg.com/news/2012-0...to-merkel.html

No European country is spending less than they're taking in, in tax-revenues. Tax rates, regulatory-environment, and Welfare-States have not changed at all. Europe is pretty much status-quo since the beginning. It's like blaming the economic environment in the US on budget cuts, which do not exist, and are solely a definition of less of an increase than the politicians wanted (ie, not a cut at all). You can't be that daft.

[Bern]

Zippy - your premise is also wrong IMO. Austerity was never promoted as an immediate or near term solution to stimulating an economy. It's a necessary economic pain to achieve long term fiscal health by deflating debt. Kind of like the withdrawals a junky has to endure to break his addiction to heroin.

[hazek]

More and more reports from Europe suggesting that at least in the sort term, austerity (budget cutting) is not working. Unemployment continues to rise in some countries (Spain just officially was classified as back into a recession after negetive GDP for the first quarter) and deficits are not really coming down much either. So far a lot of pain and little gain.

http://www.bloomberg.com/news/2012-0...to-merkel.html

Again with the propaganda... Get lost with your BS already, will you?

Even if they were cutting budgets, which they aren't, they are actually also raising taxes on already through the inflation theft and debt collapse impoverished populace. No one around here will argue this could lead to anything good in either short or long term.

[wgadget]

The Dutch Government has collapsed, elections to be scheduled soon:

http://www.usatoday.com/money/story/...pse/54483476/1

Hey...Ya suppose they'll have elections after OUR government collapses over debt woes? RON PAUL, maybe?

[Seraphim]

Domino's, BITCHEZ.

[tfurrh]

Again with the propaganda... Get lost with your BS already, will you?

Even if they were cutting budgets, which they aren't, they are actually also raising taxes on already through the inflation theft and debt collapse impoverished populace. No one around here will argue this could lead to anything good in either short or long term.

You're back!

[hazek]

You're back!

I'm the propaganda terminator, I will always be back.

[Zippyjuan]

Again with the propaganda... Get lost with your BS already, will you?

Even if they were cutting budgets, which they aren't, they are actually also raising taxes on already through the inflation theft and debt collapse impoverished populace. No one around here will argue this could lead to anything good in either short or long term.

You missed that I said in the short term things are worse. The statement is still true and not propoganda. It is why in the first post the Dutch Government collapsed and Sarcozy is trailing in French elections.