German-Led Austerity Didn't Work Then. It Won't Work Now.
Stagnant growth and productivity should raise alarm bells, not rising public debt.
A placard during a rally in France last year.
Photographer: Ludovic Marin/AFP/Getty Images
The spirit of the “Swabian housewife” — commended by former German Chancellor Angela Merkel as a model of frugality that governments should emulate — is stirring.
France is eyeing more than €20 billion ($21 billion) in spending cuts next year, amid a spiraling deficit and pressure from opposition politicians invoking memories of the Greek debt crisis. Italy, whose runaway pandemic-era subsidies are creating budgetary indigestion, is bracing for an attempt at fiscal repair. The International Monetary Fund is worried about their rising debt piles. “There isn’t enough awareness of the debt problem, nor sufficient will to tackle it,” former Italian Prime Minister Mario Monti said this week.