Over the weekend, Eurozone finance ministers agreed on a bailout for Spain’s banks. Following on the heels of Greece, Ireland and Portugal, Spain will now become the fourth (and largest) Eurozone economy to seek aid since the crisis began. Whilst the fine details remain hazy, a €100 billion rescue pot has been announced, to be channelled directly into a state-run fund in Spain for the purpose of supporting the banks, whilst the Spanish government will “retain the full responsibility of the financial assistance”.
Unlike previous bail-out recipients, Spain will not be seeking IMF assistance, nor will it (at least, according to the Spanish government) be under such close scrutiny from Brussels over the implementation of public sector cuts and reforms. Spain’s Prime Minister, Mariano Rajoy, speaking for the first time since the bailout was agreed, said that the “credibility of the euro won”. But some in Europe see this as proof that the EU/IMF bail-out conditions of severe public-sector cuts can now be relaxed. Alexis Tsipras, leader of Greece’s leftwing Syriza coalition (and a fierce opponent of his country’s bailout terms), said: “The developments in Spain confirm the position we adopted from the start – that the crisis is a pan-European problem, and the way it has been handled so far has been socially catastrophic and completely ineffectual”.
What do YOU think? Will the Spanish bailout be the last one? Or could contagion still spread to other countries, such as Italy? And how will the Spanish bail-out affect the Greek elections next week? Could we see more countries trying to negotiate “softer” terms? Let us know your thoughts and comments in the form below, and we’ll take them to policy-makers and experts for their reactions.
12 comments Post a commentcomment
It was a victory for the European nations…. Now Ireland is looking to renegotiate the terms of its bail-out program, since the problem in Ireland lies also with the banks. After Ireland perhaps Greece and Portugal will also seek the same. Greece most likely if Syriza is elected as the new governing party. No more harsh austerity for the Europeans to please the bankers and marketeers… But a more fair austerity program to deal with the crisis, combined perhaps with a growth stimulous pact, that Mr Hollande has promised us!! In Hollande we trust, and thank you Spain….!! Spanish politicians had more balls than the Green ones deffinitely…!!!
The Euro is important and should indeed be saved. However, here is a guy who, like myself, has a different idea on how to get us back to a more even keel
Instead of financing banks to cover debt, finance the people to eliminate the debt. That is a better way to go. And I have written of this since 2007. This is the first time I have heard a thinker in the same vein as I get air time.
http://www.bbc.co.uk/radio/player/b01j5h51
No If anything..has no effect.
Whatsoever. And, I’m really glad u asked :) abt this. Italy. It is different.
It has a manufacturing..like 30% or segments here n there, so r ok.
Christos u are sorely mistaken Syriza stands no chance to win, New Democracy will prevail. Again.
Yes, ’tis rue that that is what tausterity is..shld not be paid w the ppl ..but, to that end, why do you ..would u hav ..we want no austerity at all.
Since – as u state – the prob lies w the banks, there too.
Actually, if u look at it..why wld u want ..lol austerity to appease the bankers since that is where – greed – it started from?
Like putting gasoline on the fire expecting it to go out.
So it wont. we know this. But this is a diff convo.
And,coming to Hollande..stimulus pact. Ya. Stimulus.Like Obama. Quite socialist. Sure can disperse the funds..but where wld they get it/them from?
green ones? :p
Ive spoken on lower taxes, cutting spending..austerity was in there too BUT consumption, being in there too .. we can understand this as spending. On the consumer level. Not govt.
THAT is what we want.
I think it was – anything that moves us ahead as a union is a positive thing. I don’t think that reverting back to Drachmas, Pesetas, Punts, Marks and Guilders would help us much while we’re dealing with nations like the USA, China, India and the like. And there’s a bit of solidarity in that move as well (although I would want to see that motive much more overtly displayed)
–
@Chris: I, too, feel a lot better ever since M Hollande is around – he could give capitalism a “human face”, like Alexander Dubcek tried to do for communism.
–
@eunit… pardon Catherine: Absolutely einverstanden. My favorite way for Germany to help the countries in need has always been subsidizing holidays there by for instance tax-cuts (as luck has it all of them are popular holiday destinations). It would not have cost more than those bail-outs and “simple folks” from Germany vacationing with simple folks in Greece, Ireland, Portugal etc would have taken their Euros exactly where they’re needed most.
Yes, E62, you have it in one. LOL
Eu também estou orgonhoso pelos politicos da España eles tiveram bolas Esperamos que os outros paises façam renegociar os termos do seu programa de resgate Hollande nós confiamos obrigado Espanha
maybe we should be realistic and let Spain go….cut them loose. I mean why not we had a good time with them as long as it lasted right? Appearently they are far above their leauge and can’t keep up with the rest of Europe.
What we need to cut loose are ties to the USA. They are the saboteurs of the Euro.
http://www.youtube.com/watch?v=-FQXxuv2msU
And today we hear in the UK the banks have been subsidized again to the tune of another £140 billion pounds a year.
http://www.thisismoney.co.uk/money/news/article-2159519/Bank-shares-boosted-140bn-scheme-ease-lenders-eurozone-pain.html
Note how this article blames the Eurozone for the crisis. not the culprit the USA. The hogwash spin is relentless.
Albert I did not say Syziza IS going to win for sure…But there is a possobility… People do not want the PASOK and New Democracy parties anymore, after decades of robbing us and our European partners blind and exposing the country, embarassing us and now surrendering us to the wishes of Europeans bankers…. If they vote for New Democracy, their majority will be very slim and it will be nail bitting to watch…
I have a dream: the last Media catch – Germany left the euro zone. Then I wake up to the sad reality.