European Elections

Voters in France and Greece sent an inescapable signal to the euro zone: austerity. Austerity is basically a policy of deficit cuts by lowering spending often through a reduction in the amount of benefits and public services. In france and Greece they showed that the average guy on the street understands economics better than the people in power. Instead of reducing debts and returning the European economy to health, the all-Austerity approach to solving the debt crisis was sending the weaker economies of Europe into a death spiral of recession, unemployment, and ultimately continued strain on national finances.

the problem is that whatever the verdict of the ballot box, Europe can’t avoid austerity. Its indebted 

governments can’t simply return to spending and borrowing as they had in the past. Financial markets just wouldn’t stand for it. So the question going forward is not what replaces austerity, but what new mix of policies along with austerity are needed to restore prospects for growth, fix national finances and quell the debt crisis.

There is a case to be made that the problem with austerity is not the austerity itself, but the pace at which it is being imposed. Rather than a mad rush to meet euro-zone deficit limits, more flexibility is needed to allow governments to adjust over a longer period of time and benefit from economic recover