Eurozone unemployment hits new high with quarter of under-25s jobless | Business | The Guardian

austerity

austerity (Photo credit: 401(K) 2013)

 

Austerity

Austerity (Photo credit: GoatChild)

 

This is a MUST READ article from the Guardian. Check it out!

 

Eurozone unemployment hits new high with quarter of under-25s jobless | Business | The Guardian.

 

Finally, the message seems to have sunk in that excessive austerity is the wrong policy. We have recently seen Angela Merkel‘s government try to distance themselves from excessive austerity and build bridges in Europe. Most significantly, it looks like the Franco-German axis is back in business and the target is the EU. Meanwhile, the EU is wriggling at holding the austerity poison chalice and is turning  belatedly to  initiatives for jobs.

 

What a mess!

 

Young people are right to demonstrate. Let’s hope that demonstrations stay peaceful but there are a lot of people who are bitterly critical of Europe’s political leaders and the EU.

 

Any thoughts?

 

 

 

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2 responses

  1. The trouble is that “austerity” has been very badly handles – sledge hammers come to mind. Yes, national and public debt had to be brought back under control and as quickly as possible. Withdrawing employment from those in the public employ is entirely the wrong way to go about things. Tax takes frop, costs rise and the whole thing becomes a nightmare – and the people are the ones who suffer.

    Easy to say that – far harder to suggest what should have happened. Two thoughts: if we (I speak about the UK only in this context) could afford QE we could afford to move people out of unemployment into useful situations EVEN IF THOSE WERE NOT PROFITABLE. We could have provided better care of our frail elderly people, we could have had small ill-equipped workforces who, despite the lack of equipment, could have carried out early remedial work on our frost damaged roads. In both cases this would have actually saved money in the long run (by keeping those old people out of hospital and on the “stitch in time” principle). There are two problems: we would have had to do something about the benefit system to stop some being better off out of work (which would have been very unpopular – but we can’t go on as we are) and we would have had to make stepping in and out of benefit far easier (so many people refuse work because they know that if it doesn’t work there will be a huge problem in getting back into benefit) and, on the other side, we would have had to have a rethink on employment law and employment costs (even if the “employer” is the state these problems make it easier, simpler and seemingly cheaper to farm work out).

    So, austerity is probably the only way forward – but not th way it has been implemented.

    • Rodney,

      I too believe that austerity has been badly implemented. Like John Gelmini, I believe that it should have cut much more deeply then moved on like in Canada. The extended austerity that we currently have is counter-productive in my view and making the recession worse.

      I am not sure that I fully follow your point about QE and being able to afford things. QE is essentially a balance sheet transaction and not directly related to national income & expenditure. Perhaps, you would like to clarify and extend your argument? – I would be happy to publish it as a guest blog.

      Thanks

      Alf

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