We have had austerity, increasing unemployment and a few riots taking place in Europe. With poverty increasing, the situation is heading the wrong way. Are we facing a violent revolution due to austerity measures? From Voxeu.
It is not just the election of François Hollande in France. Adopting contractionary fiscal policies in the teeth of a double-dip recession never made sense. And yet, public debts are high and markets in endemic panic. The solution must be based on a comprehensive analysis of the situation, not on arcane debates on the strength of the “confidence factor”. It ought to combine debt restructuring, front-loaded collective fiscal expansion and long-run unbreakable commitments to fiscal discipline.