By Larry Elliott – For two years, Europe has been force-fed a diet of unrelenting austerity. The crisis began in the private sector – in over-leveraged banks and wild financial speculation – but such was its impact on consumer spending, investment and trade that governments have seen their public finances dive deep into the red. Spending cuts have been imposed, pensions have been made less generous, and taxes have gone up. The policy has been an economic disaster. Growth has collapsed, unemployment has soared and – unsurprisingly – budget deficits have been much bigger than forecast. Election results from France and Greece show that it has also been a political disaster: voters have decisively rejected Euro-sadism and made it clear they want their politicians to chart a different course. Democracy has trumped austerity.
In the fantasy world of policymakers in Brussels, the eurozone would fast-track to full fiscal union, but there is no realistic chance of this happening any time soon. more> http://tinyurl.com/6srwlqq
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