Latest stop on the eurozone debt tour: Portugal

posted at 1:21 pm on April 8, 2013 by Erika Johnsen

The eurozone’s ongoing debt-crisis attention is shifting from Cyprus to Portugal this week, and not in a good way. Portugal has been struggling with a shrinking economy and unemployment sitting at 17 percent, and last Friday, a Constitutional Court struck down several of the austerity measures the government was hoping to implement to keep their international bailout program in the clear:

In an address to his beleaguered nation on Sunday, Prime Minister Pedro Passos Coelho warned that his government would be forced to cut spending more and that lives “will become more difficult” after a court on Friday struck down some of the austerity measures put in place after a bailout package two years ago. …

A critical moment for the latest trouble took place on Friday, when Portugal’s Constitutional Court struck down four of nine contested austerity measures that the government introduced as part of a 2013 budget that included about 5 billion euros, or $6.5 billion, of tax increases and spending cuts. The ruling left the government short about 1.4 billion euros of expected revenue, or more than one-fifth of the 2013 austerity package.

Specifically, the court, which began reviewing the legality of the government’s austerity measures in January, ruled as unconstitutional and discriminatory the government’s plans to cut holiday bonuses for civil servants and pensioners, as well as to reduce sick leave and unemployment benefits.

It doesn’t look like their international lenders are going to grant them any leeway, which means that the Portuguese government will now need to think up some new ways to raise revenue to meet their budgetary targets. One of the brilliant ideas that’s reportedly been floated already?

In his televised statement, Mr. Passos Coelho said the government would try to revise its budget plan through new spending cuts rather than new tax increases. A person close to the government said it had mulled the idea of paying public employees and pensioners one month of their income in Treasury bills, forcing them, in effect, to lend the Treasury the money the court said it couldn’t cut from their paychecks. A government spokeswoman denied that the idea was being considered.

…I would certainly hope the idea isn’t being considered, because something tells me that just deciding to pay your workers in feeble government promises wouldn’t go over well on any front. With any luck, they won’t be going down that road, but this idea just after the Cyprus debacle? How long are Americans going to buy the Democrats’ line that our $16-going-on-$17 trillion debt isn’t really an urgent crisis with which we need to deal swiftly and decisively, and that we can just go on spending pretty much the same way we have been for years to come? Does anybody else feel like they’re taking crazy pills?


Related Posts:

Breaking on Hot Air

Blowback

Note from Hot Air management: This section is for comments from Hot Air's community of registered readers. Please don't assume that Hot Air management agrees with or otherwise endorses any particular comment just because we let it stand. A reminder: Anyone who fails to comply with our terms of use may lose their posting privilege.

Trackbacks/Pings

Trackback URL

Comments

Erika, your first two sentances are messed up a bit.

But on topic: Yeah, Portugal is in a bad place, with a bunch of libs on their court preventing them from doing anything.

Vanceone on April 8, 2013 at 1:26 PM

Specifically, the court, which began reviewing the legality of the government’s austerity measures in January, ruled as unconstitutional and discriminatory the government’s plans to cut holiday bonuses for civil servants and pensioners, as well as to reduce sick leave and unemployment benefits.

Alegria de uns, tristeza de outros.

Because selfish government workers feel entitled to more luxurious benefits than the rest of society receives, everyone else will have to bear the burden of their selfishness, probably through tax hikes.

steebo77 on April 8, 2013 at 1:26 PM

European cockroaches about to run out of a free existence; cast eyes toward North America.

BobMbx on April 8, 2013 at 1:31 PM

If Portugal were a sovereign state with control of its currency they would have some options to mitigate their mess.

Too bad they don’t.

forest on April 8, 2013 at 1:31 PM

Who was that lady that said something about ………………………………………… Socialism eventually running out of other peoples money?

FlaMurph on April 8, 2013 at 1:33 PM

Hey! Every time Barry comes up with a new program, he guarantees that “it won’t cost an additional dime!”

GarandFan on April 8, 2013 at 1:33 PM

they fell out of the crazy tree, hit every branch on the way down and then took the crazy pills

DanMan on April 8, 2013 at 1:38 PM

Were it not for the great Lady Thatcher they’d be stopping in London now.

Schadenfreude on April 8, 2013 at 1:40 PM

If Portugal were a sovereign state with control of its currency they would have some options to mitigate their mess.

Too bad they don’t.

forest on April 8, 2013 at 1:31 PM

Exactly, also the massive flood of debt from northern Europe wouldn’t have happened had Portugal had her own currency.

Who was that lady that said something about ………………………………………… Socialism eventually running out of other peoples money?

FlaMurph on April 8, 2013 at 1:33 PM

This is much less about socialism and much more about the idiocy of the common currency. She had a lot to say about that more important issue as well.

jarodea on April 8, 2013 at 1:49 PM

One must never forget, socialism is a form of Marxism. It is a system designed by Engels and Marx to facilitate the transition from Laissez faire to Marxism. The progression as envisioned by Engels and Marx was Laissez faire to socialism, socialism to communism, communism to Marxism.

All three of the Marxist sociopolitical economics systems rely on human being not being human. They rely on individuals surrendering their natural self preservation instinct to someone or something greater than their self.

They also rely on a concept that has been proven to be false, that being, that economics is a zero sum equation. That all wealth and resources are finite and can only be shuffled around.

These are the basic reasons that every single time any derivation of Marxism has been tried, it has failed utterly and completely. Marxism assumes that the basic fundamentals of human nature are mailable and can be change at whim. Marxism is a system designed by a narcissistic megalomaniac with delusions of Godhood.

SWalker on April 8, 2013 at 1:52 PM

Marxism assumes that the basic fundamentals of human nature are mailable and can be change at whim. Marxism is a system designed by a narcissistic megalomaniac with delusions of Godhood.

SWalker on April 8, 2013 at 1:52 PM

And he wasn’t shy about turning to tactics straight out of hell when his visions of Godhood ran into reality…or the little people just got in his way too much or too often. (if you did that ONCE and survived you were lucky)

MelonCollie on April 8, 2013 at 1:57 PM

Marx was just a typical prolonged adolescent that never moved out of his mama’s house. Loserville.

tom daschle concerned on April 8, 2013 at 1:59 PM

Marx was just a typical prolonged adolescent that never moved out of his mama’s house. Loserville.

tom daschle concerned on April 8, 2013 at 1:59 PM

Uh, no. He was the most dangerous kind of man alive: one with a gnawing dream of ruling and a viable way to make it happen. His empire stood off the USA for decades and would’ve lasted longer if they hadn’t insisted on trying to keep up with Jonses they never could keep up with.

Peter Pans don’t hatch iron-fisted regimes that go on to affect the entire planet. I’m sorry, but they just don’t.

MelonCollie on April 8, 2013 at 2:05 PM

Marx was just a typical prolonged adolescent that never moved out of his mama’s house. Loserville.

And had a boyfriend to pay the bills.

I remember the sense of absolute joy that went over me one day when I was browsing through a junk shop and I came across an old copy of Das Kapital and on the frontispiece was a rare extant photo of Engels and you could see the little hole for the earring in his left lobe.

It all made so much more sense after that.

JoseQuinones on April 8, 2013 at 2:05 PM

I like how cutting spending is considered a last ditch response.

Iblis on April 8, 2013 at 3:14 PM

tom daschle concerned on April 8, 2013 at 1:59 PM

Uh, no. He was the most dangerous kind of man alive: one with a gnawing dream of ruling and a viable way to make it happen. His empire stood off the USA for decades and would’ve lasted longer if they hadn’t insisted on trying to keep up with Jonses they never could keep up with.

Peter Pans don’t hatch iron-fisted regimes that go on to affect the entire planet. I’m sorry, but they just don’t.

MelonCollie on April 8, 2013 at 2:05 PM

I’m going to have to agree to some extent with MelonCollie here. One must do a bit of research on Karl Marx to understand the nature of his political ideology. Karl Marx was an atheist self hating Jew, whose wife, Jenny von Westphalen, was a Prussian Duchess.

Because Jenny married a Jew she was Osterized from her Aristocratic Family. Basically kicked to the curb, neither her Prussian von Westphalen relatives nor her Scottish Wishart and Argyle relatives would have anything to do with her and Karl. (Which is not to say that Jenny’s father, the Baron Ludwig von Westphalen, did not approve of Karl or like him) It was the rst of the relatives that didn’t.

Karl, whose own family were moderately wealthy and his wife Jenny were, despite their hatred of the Aristocracy, basically Aristocrats, and they lived lives as individuals accustom to that station. Privileged, educated, pampered, and above all resentful.

Karl Marx’s political ideologies amount to bastardizations of both the Jewish faith, and the Aristocratic feudal system. His resentment of both religion and the Aristocracy of which he was both a part and denied official recognition in drove him to create a system that would overthrow both religion and the Laissez faire mercantile economic system that supported the Aristocracy.

He was, in short, a religious fanatic determined to prove that he and his intellect were the equal of all of those whom he blamed for denying him what he believed was his just lot in life.

SWalker on April 8, 2013 at 4:00 PM

Getting paid with IOUs is a perrinal favorite here in California….

Shocking we have not done so with Governor Moonbeam the Second Comming in power.

Snowblind on April 8, 2013 at 5:52 PM