Looking at the unemployment rates right now, with Spain at 25.8% and Portugal at 15.7%, I think the priority of their government should be to create economy growth rather than austerity. Debts can be repaid when there is increased income, but if the budget cuts go into the areas that affect economic growth, then it will inevitably end up in a downward spiral to national poverty. It took these European countries many years to rise to prosperity after WWII but the pursuit of individual entitlements and rights have created too much wastage and inefficiency. When companies have to pay hefty pensions, medical coverage and paid maternity leave (although I don’t oppose them), and still have workers going on strike every now-and-then to ask for more, it is going to hurt their bottom lines. Piling on top is the high corporate taxes, which the governments are going to increase further, may cause struggling companies to close down and create even more unemployment. The costs round back right to the government, which will have to use tax money for the unemployment handout in order to prevent social collapse. I seriously question their judgment and decisions. Why don’t they go the opposite direction? Lower taxes for small businesses, provide easy loans for startups, trim the excesses from workers’ benefits, reduce inefficient agricultural subsidies, invest in R&D and promote value-added industries. Get youths off unemployment by encouraging entrepreneurship to generate economic activity and wean off their dependence on government jobs and big corporations. These young people may lack experience, but they have the energy and drive to work, some are very well-educated and if given a little push, they can be the business leaders of the future, creating plenty of jobs for others. By having so many young, energetic people rotting in their parents’ homes, they are wasting the very resource that is the key out of the debt crisis. Instead of sitting around and blaming past leaders for maxing out their national credit cards, it is time to take action and fundamentally change their approach to this economic fiasco.
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