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Spain Approves €15Bn Austerity Budget By One Vote

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http://www.telegraph.co.uk/finance/financetopics/financialcrisis/7771293/Spain-approves-15bn-austerity-budget-by-one-vote.html

Spain's governing Socialists won approval for a €15bn (£12.7bn) austerity package by just one vote on Thursday, avoiding a defeat that would have rattled markets and potentially brought down the government.

The bill was approved by 169 votes in favour to 168 against, after the opposition Popular Party voted against, even making sure one of its deputies was brought to the session in an ambulance.

It was only saved when 10 deputies from centre-right Catalan nationalists CiU abstained after criticising the bill, saying they did not want Spain to be plunged into a Greek-style crisis.

But CiU said they would not support the 2011 budget bill, Spanish news agencies reported, raising doubts over how Prime Minister Jose Luis Rodriguez Zapatero will be able to continue to steer his country through a time of crisis.

Josep Antoni Duran i Lleida, the CiU leader, told parliament Mr Zapatero should call early elections next year. "The problem is you and your government," he told him.

If Thursday's bill had been be defeated, the government's plans to get its budget deficit under control would have been thrown into disarray, potentially dismaying credit markets by raising concerns the eurozone's fourth largest economy was fiscally unsustainable.

Spanish commentators said it was difficult to imagine how Mr Zapatero would have been able to stay in government had he lost the vote, which would have sent shockwaves through markets terrified that the Greek crisis will engulf the much larger Spanish economy.

The Basque Nationalist Party said on Wednesday it would side with the Popular Party and oppose the cuts.

The government's plan aims to save an additional €15bn and includes wage cuts of 5pc for civil servants this year. It aims to cut the budget deficit to 9.3pc of gross domestic product this year and then to 6pc in 2011, down from 11.2pc last year.

Italy joined Europe's austerity club this week with €24bn of cuts targeted at public workers and local government.

Still it's contained....

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I think though the reaction in greece, this narrow vote and whatever would happen in say italy or france should similar deficit cuting measures be needed illustrates the point.... it isn't whether govts understand the need for cutting, its that the people of many of these countries have failed to grasp that it isn't a fundemental human right for public sector workers to have gold plated pensions, 13 th and even 14 th month payments, bonuses for just doing their job, unheard of job security, overmanning etc etc ... in spain and greece and many many other countries ( including our own) there are bloated public sectors which when you add them to the benefit sloths add up to more than 50% of the population.... unless europe suddenly finds some strong leaders or the unions get some common sense or heavne forbid the turkeys vote for christmas themselves then its not going to be options that europe runs out of but guts.... europe needs strong leadership to sort these issues out.. its going to mean a generation of pain and for many a complete change in lifestyle, we'll see many riots etc along the way.... but the reallity is europe cannot afford to feather bed its people to the degree it has done.... in future life is not going to be nearly as cushy for many.......... and as we go down this hard and bloody path I suspect the markets will mark things down alongside every riot they see, until the populace have been subdued in perhaps eighteen months time.

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  • 150 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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