Those responsible for Europe’s austerity policies cannot be allowed to pretend their decisions did not have consequences. (source: Jana Liptáková)
Last week Spain and Portugal were the first two countries to receive the European Commission’s approval for their plans to tap into the EU’s coronavirus rescue fund. For the first time ever, the €750-billion programme creates a common European debt pool, and the plan is a complete reversal from the disastrous austerity policies pursued in Europe in the wake of the 2008 crisis.
Led by Germany, and cheered-on by likes of then Slovak Finance Minister Peter Kažimír, Europe had thus far refused to issue common debt. Instead, during the rolling crises of the 2010s they opted to force (mostly) Southern European countries to cut spending in exchange for loans. More than a decade later it is clear that those policies did exactly the opposite of what people like Kažimír were claiming they would.
