Public debt in Europe is growing. Despite austerity, EU gross government debt has risen every year since the financial crisis in 2007-2008. Currently, 16 out of the 28 EU Member States are breaching EU rules over public debt, with total debt burdens larger than the 60%-of-GDP limit set out in the Maastricht Treaty.
Critics argue that the growing debt mountain proves that austerity policies have failed, while supporters point out that deficits (i.e. the amount that government income falls short of expenditure) have been steadily shrinking, which is a more important indicator.
What do our readers think? We had a comment sent in from Tony, arguing that something should be done about the “massive government debts” because they posed a risk to economic stability in Europe. So, what’s the solution?
How would YOU cut government debt? We asked Members of the European Parliament (MEPs) from all sides of the political spectrum to stake out their positions on this question, and it’s up to YOU to vote for the policies you favour. See what the different MEPs have to say, then vote at the bottom of this debate for the one you most agree with! Take part in the vote below and tell us who you support in the European Parliament!
Radical Left
Stelios Kouloglou (Radical Left), Member of the European Parliament:
Well, you know debt is not the problem, it only became the problem because of Germany. Over the centuries, countries have always had debts, and they reduced their debts by borrowing more money. Today, however, it has become a major problem because Germany has imposed its own rules of governing that have more to do with family economics than the science of economics. All major economists – including Nobel prize winners like Paul Krugman and Joseph Stiglitz – say debt is not the problem. The problem is that we have no growth.
Social Democrats
Neena Gill (S&D), Member of the European Parliament:
Our major concern is that debt is continuing to grow, and especially when we look at the figures for 2015 we see that it has grown considerably not just within the Eurozone but across the EU-28 as a whole. Clearly, the way to address it is by fostering greater economic growth, and so we have been looking at how we can enable more growth and more money into the real economy. But the second element of it is clearly looking at the restructuring of some elements of public debt. I think that’s definitely needed in some places, like Greece, so that it is not unbearable for public services to be provided to people who need them. So, we should be looking at longer maturities and lower interest rates for debt.
Of course, a third way to address the problem would be through the common issuance of EU government bonds. But that’s slightly more sensitive, given that it would require convergence of macroeconomic policy, and that’s not really acceptable to the majority of the members of the EU presently.
Greens
Terry Reintke (Group of the Greens), Member of the European Parliament:
Well, I think there has been a focus on cutting public expenditure in order to cut public debt over the last few years. We, as Greens, would rather look at how we can increase the income side of the equation. So, for example, when we look at a Financial Transactions Tax, or a common corporate tax base, or wealth taxation inside the EU, we are looking at ways to increase public budgets in order not to create more debt, and at the same time to have the expenditure needed to boost the economy in a sustainable way. Over the last few years this has been neglected and has created a major economic and social crisis.
Liberal Democrats
Sylvie Goulard (ALDE), Member of the European Parliament:
Centre Right
Michaela Šojdrová (EPP), Member of the European Parliament:
The European People’s Party (EPP) would cut government debt by promoting budget responsibility and measures supporting economic growth.
Conservatives
Sajjad Karim (ECR), Member of the European Parliament:
Eurosceptics
Laura Ferrara (EFD), Member of the European Parliament:
We are facing a political battle to opt out from the euro. Indeed, in our opinion the European currency – a de facto foreign currency – is the main reason behind the high government debt in many Member States, such as Italy.
If the state is free to issue its own currency with which it must repay its debts, it can always guarantee the payment of government bonds it has sold. If it cannot issue its own currency, it must procure money abroad to repay both bonds and interest. To do so the state will have to tax citizens, cut public spending, and go further into debt. This is the paradox of debt that pays off more debt even as it multiplies itself; a vicious circle that has its origins in the absence of monetary sovereignty.
Curious to know more about the growing debt burden across Europe? We’ve put together some facts and figures in the infographic below (click for a bigger version).
With zero interest there is motive to increase and not to cut government debt.
Marco Peel
They are all wrong. The economy no longer requires cheap labour, mass production and consumption. In a world with finite resources, perpetual growth is per definition unsustainable. And in a society where material needs are mostly covered, we will have to find new ways to measure real development and fairly compensate people’s contributions towards a better and more sustainable economy and society. We have to move past the left-right divide that only focuses on material distribution, and move into the 21st century.
Societies only develop when the middle classes grow and poverty shrinks – when inequalities are reduced and general well-being improves.
As far as debt is concerned we should indeed make a distinction between good debt for investment and bad debt due to inefficiency, but not forget illegitimate debt due to corruption and abusive interests.
In the short term, Europe should come together to properly address the problem of tax evasion. If large companies and fortunes would actually pay the taxes they are due, like everyone else, we would not have the budget deficits that lead to ever increasing debts, or the competitive disadvantages that lead to increasing inequalities. We don’t need new taxes, just that everyone pay their fair share.
I agree with you Marco, but I see not only large companies should pay taxes as they already employ people that pay taxes and officially play in the open market, but businesses avoid to pay taxes being in the black market and protected by local government and authorities including politicians. I see illegitimate debt due to corruption and abusive interest is against democracy and try to rule in power for a long time irrespective the names and faces you see to create an empire with own rules and concentrate resources and real opportunities in a circle of few initiates and protected decision maker undermining any effort to real development might put on doubt their congregated community. Europe shouldn’t tolerate any essential broken principle if we want to develop us as a team as you said. The team of corruption and without sound and fair principles is more dangerous than several different states playing their fair and regulated own role in the market.
Tarquin Farquhar
@Marco Peel
For countries like Greece or Italy, its not just large companies not paying taxes – its large numbers of citizens not paying taxes too.
The EU should base contributions inclusive of the black economy of various systemically corrupt EU member states.
il debito pubblico se sovrano è la ricchezza dei cittadini . Chiusa UE , euro ecc…. finisce il problema del debito pubblico ESTERO . Il problema non è il debito pubblico ma il debito estero . Come si può votare uno di queste forze politiche ad una domanda che sappiamo che è falsa ?
Remove benefits . EU is not that people can travel round and search for “the best benefit” . We should remove such kind benefits everywhere in the EU , EU should destroy tax havens and stop financing church and other religious organisations.
Tarquin Farquhar
@Vinko Rajic
Please kindly provide me with information on how the EU finances the church and other religious organisations – thanks.
This is a misleading article and no one has pointed out that public debt and government debt is totally different has is interest rates set by EU member countries totally different than interests rates set by the banks and other money lenders. The only way to cut public debt is to make it harder for people to borrow money its as pure and simple as that.
Il debito pubblico è un deterrente solo per il popolo non per chi governante egoisticamente e stupidamente. Lo si evidenzia solo quando i ricchi ed i politici debbono speculare…cioè rubare.
The EU, as a while or individualy, will NEVER stop the raising debt because the money is spend to fill politicians, friends, family, corrupt enterprises, etc etc….pockets. If their gains were ONLY cut by half, Europe’s economy will grow, not needing austerity.
Tarquin Farquhar
@DEBATING EUROPE
Your graphic failed to mention that the UK also helped the Eurozone in its financial crisis. Specifically, the UK loaned Ireland billions of pounds to help save Ireland’s banks.
Tarquin Farquhar
Help countries like the A8 and Greece which have suffered from de-population of late AND move ALL refugees coming from Syria and Eritrea and Iraq and Afghanistan to the A8 and Greece!
After all immigration is always a net contributor to a country’s economy and in say Romania or Bulgaria they have seen their populations shrink by millions of late and they could do with a financial boost.
None of them. All ballot papers should have a “none of the above” option and if ‘none of the above’ win then people should be able to elect individual good people to parliament instead of greedy self-seeking politicians.
After eight years of Austerity measures that have only resulted in stagnant economies, long term unemployment, increasing inequalities and spiralling public debts, we’re still asking what the problem is? Europe now looks more like it did at the beginning of the 20th century than at the end. Have we learnt nothing? The EU would do well to remember its founding principles of diversity, cohesion and democracy, for they have become nothing but hollow slogans in an open market of sheep for wolves. The only way we can win, is as a team.
Austerity measures only help the rich get richer and cuts down on needed revenue
EU reform- proactive
A problem nobody managed to solve yet- nor was any answer from the 7 parties useful! Eurosceptics Laura Ferrara (EFD) comes closest- “opt out from the euro”. EU monetary “rules” like the 60%-of-GDP limit & <3% annual deficit are unenforceable & unworkable. My humble suggestions (sorry for the length):
Since all debt- be they called government, national, public or sovereign debt (all the same) has to be repaid by its taxpayers one day- sooner, eventually or later- THEY must decide HOW it’s done! Bankers know- a government will/can never default!
The ECB/EU/Brussels is not a sovereign country, failed this test over ~20 years, gambled its mandate away and therefore must return the financial toolbox to each (still diverse & unequal) member. In order to reduce & spread the (global) risk- everyone becomes once more financially responsible (no blame game), therefore:
* All countries need to regain full sovereignty over ALL their affairs.
* EU to be "reduced" to a think tank, consultant & facilitator. This will save money- (but not EU's face) in the process, sorry!
* All should obtain (yet elusive) “direct democratic” decision making power over own level of indebtedness & their consequences.
* Monetary, fiscal & central bank policy decisions returned to members. ECB abolished- shares returned, Draghi becomes unemployed (sorry Sir!).
* Educate the electorate about various options of monetary & fiscal policies and the importance and advantage of a balanced annual budget and future debt reduction. (sorry again ALL Private banks, IMF, WB & Rothschild)
* Prohibit borrowings from all private banks- use them only for transaction accounts.
*Government debt will only be sourced from taxpayers directly- as approved, as and when required- ending the use of an “AGENT” (Banks). The savings in bank profit, interest costs will benefit all taxpayers, prevent corruption & reckless trading in government debt (bonds). Own CB/Governments will decide on monetary (creating money) & fiscal measures (tax matters).
* Funds required for private investment to be separated & raised from private banks & subject to market forces. This will reduce taxpayers exposure to unnecessary market risks & manipulations.
* Taxpayers will be freed from the feeding frenzy of Banksters financial engineering.
* Private banks limited & "forced" to return to responsible lending, deposit taking and a tool for conservative saving.
George Yiannitsiotis
It sounds rational; however, the winners of this euro-madness (namely, Germany) will opt for the destruction of PIIGS instead of losing the milking euro-cow.
EU reform- proactive
Yes George, the (EU) preamble states: “Disziplin und Gehorsamkeit ueber alles”
George Yiannitsiotis
It sounds german to me and I can’t understand it. Sorry! State it in English, French or Greek pls.
EU reform- proactive
George sorry, in translation it confuses historical glory – google the German anthem!
Even billionaire Warren Buffett says: derivatives are “financial weapons of mass destruction.” Our friend “Mad” Max Keiser warns since 2013 about the (self)
destruction of “Deutsche Bank” & lots of wealth.
If one has any money left- rather find an “old mattress” – not a bank! Any distant relationship between reckless Banksters & reckless Politicians? Interesting times!
It is essential to develop masses of wealth creation jobs and new businesses and reduce unemployment and give those on low paid jobs better chances to improve their incomes. If this is done it will then be possible to receive more taxation and to use that extra money to reduce debts…improve services and reduce taxation etc. It might take 5-10 years but it seems to be the most obvious idea and it will improve many people’s lives.
Increase state incomes not just cut on expenses. Force people who received social benefits to work and contribute to the society. Nationalise bad performing banks that receive bailouts. Energy companies should all be public (and be franchised to private investors for better management). The territorial integrity of a Country should cease being a taboo (unproductive regions that represents a burden for some Countries could be sold to others making a win-win for both ones). State owned industries should be reopened using unemployed people as labour force.
I think that the first thing to do is stop sacralizing “Public Debdt” concept itself. It isn’t but a convention based upon a set of “economic rules” that have been set up along centuries by prestamists. t is time to move to a new, more human focused, set of rules and concepts.
In the other hand, the big problem with public debdt is the awful fiscal policies which prevail in most European (and non European) countries. A more social oriented fiscality is na urgent need.
And, yes, to get to set up that new social fiscality, we need more economic, SOCIAL and political union in Europe.
1. Freedom to make stronger trade deals with other nations.
2. Freedom to spend UK resources presently through EU membership in the UK to the advantage of our citizens.
3. Freedom to control our national borders.
4. Freedom to restore Britain’s special legal system.
5. Freedom to deregulate the EU’s costly mass of laws.
6. Freedom to make major savings for British consumers.
7. Freedom to improve the British economy and generate more jobs.
8. Freedom to regenerate Britain’s fisherie
9. Freedom to save the NHS from EU threats to undermine it by harmonising healthcare across the EU, and to reduce welfare payments to non-UK EU citizen
10. Freedom to restore British customs and traditions.
How right is Marco Peel? “The only way we can win, is as a team”! Well, well…. another hollow slogan?
The political EU is not a soccer team or united corporation! How true & relevant is “team work” within a diverse, complex & competing political environment (called democracy) like the EU28- with 7 competing parties? Could “Team work” be or become undemocratic or counterproductive? Should it rather be cooperation, tolerance, compromise & consensus?
It is partly due to excessive austerity. The US recovered much faster than Europe because there was less austerity. Also Europe has an obsolete system with excessive taxes, excessive protection for incumbents in business and labor, and rigid labor markets.
Y pagaremos los que hemos cotizado más de 40 años ala seguridad social, manda cojones, lo que hay que hacer que los Políticos no gané las burrada de sueldos y dietas y aforado que hay E U y en ESPAÑA, menos sueldasos …….
Hoy vivimos un tipo de dictadura peculiar, que beneficia a politicos y especuladores profesionales y tecnocratas., y el ampliar la corte de beneficiarios y usar ( en modo simulacro ) los procesos propios de una democracia formal, enmascara eficazmente este caracter dictatorial otorgando una apariencia de normalidad democratica, donde y cuando las mayorias sociales nos vemos d sometidas al arbitrio y abuso de estos tuzaros que han traido y siguen insistiendo en , anhos de penurias y oscuridad propios de hace un siglo, las conquistas sociales reconvertidas en derrota y abandono, la ciudadania asiste a la expulsion supuestamente legal de su vivienda, se financia con dinero publico la ensenhanza privada y se depaupera la publica, se repite esto con la salud publica, el trabajo ya no nos saca de la pobreza, aceptamos la mortandad y el hambre infantil como cosa normal e inevitable, la exclusion social funciona como amenaza a la puerta de cualquiera, se alimentan desde los servicios de inteligencia, fanatismos religiosos, guerras y diasporas, xenofobia social como respueesta.. Esos tipos tipos que vemos en esas conferemcias internacionales, tan lustrosos, pulcros engominados y satisfechos, tomando decisiones por y sobre nosotros,… son nuestras sanguijuelas, criminales con corbata.. no dejemos que nos cuenten lo de sus votos con esa jeta de nuevos ricos que se gastan, sabemos en que condiciones y con que contubernios conquistan sus votos, y (creen ellos) nuestras vidas.. Vamos a entregar a su avidez de chupasangres, las vidas de los jovenes, sin derechos, ni opciones a defenderse de lo que se trama y conspira contra ellos?
The appeal to a modrat increasing of dbt is the one political to do.Is the Community available to modify euro value in nations who are an hard debt to regulate?
The monetary system is a debt based enslaving system. You can’t eliminate debt without changing the system.
eusebio manuel vestias pecurto
The Euro is the biggest obstacle to the development of the country and its passing is possible only with the recoveryof monetary sovereignty not as an end in itself but to enable a growth policy of full employment for economic growth and social development
eusebio manuel vestias pecurto
There is some market class in the world that was not rigged financial markets were in any way defraudend by drugs Bankers and policians should be investigated by your fancy
The solution is simple. Tax the mega-rich and corporations. Slap a wealth cap on both of them. And for corporation give them a flat-rate lower tax on their gross income thereby bypassing the tax avoidance loopholes and tax-haven problem. Also charge them interest for their loans and give interest-free loans and no tax to the public. They will still be mega-rich and the people will prosper a little more.
ned
A start to put thing right is to pay off the deficit and debt and make it illegal for any government to run up debt or even sell debt on the bond markets, This will mean they will have to live within their means and have an incentive to make the economy grow so they can fund their spending plans, pet social engineering plans. and engineered re-election prospects.
dispite austerity? austerity is responsible for that but wont change as germany gains from that
Alexander Rizzuto
1. In your question, you assume government debt has to be cut because you think the government is like a household that has to repay its debt by raising taxes in the future, burdening future (mine included) generations. It’s false, it’s a myth. Government IS NOT like a household because usually it is the currency issuer, it can’t run out of money. It can happen only if there are self-imposed constraints (debt ceilings, fixed exchange rates etc.) or if the government isn’t the currency issuer (Eurozone).
2. By focusing on such things like deficits or government debt, you’re missing the point: the point is the REAL RESOURCES AND THE REAL PARAMETERS. How to close the terrible output gap, meaning how to put everyone to work? With high unemployment and low capacity utilisation, real goods and services aren’t produced and their benefits are foregone, FOREVER. How to break up oligopolies, leave out rent-seeking agents and shape the bargaining process to guarantee non-inflationary growth. How to modernise the productive apparatus in countries like Italy, who lag behind. What type of education do we need to create competitive markets and the economy of the future? When do we stop financial markets from gambling with our money? How to reduce PRIVATE DEBT? How to balance the current account?
3. If you want to reduce the debt/GDP, the most constructive way isn’t austerity, it isn’t by inflating it away, but by promoting growth through public investment and fiscal stimulus.
change income tax, to purchase tax. and charge the global companies a tax on every thing they sell. make estate agents who let properties for other send details of who rent is being payed to with there Nat insurance number, as the tax man never finds out that a lot of people rent out properties and get an other income.
Why has it risen?
Is the EU paying too much for the banks’ mistakes?
Are politicians not accountable for their decisions?
Is everyone paying their dues?
What about the 1%?
What about the international corporations?
What about the fiscal havens?
Are specific countries more in debt than others?
Transparently answering these questions would be a good start?
By the way, the Dow Jones chart in the picture is misleading!
It is a 2008 chart. Change it, please!
Why has it risen?
Is the EU paying too much for the banks’ mistakes?
Are politicians not accountable for their decisions?
Is everyone paying their dues?
What about the 1%?
What about the international corporations?
What about the fiscal havens?
Are specific countries more in debt than others?
Transparently answering these questions would be a good start?
By the way, the Dow Jones chart in the picture is misleading!
It is a 2008 chart. Change it, please!
Why has it risen?
Is everyone paying their dues? Like the 1%?
Or international corporations?
Is the EU paying too much for the banks’ mistakes?
Are specific countries more in debt than others?
Transparently answering these questions would be a good start?
By the way, the Dow Jones chart in the picture is misleading!
It is a 2008 chart. Change it, please!
Strange that the simple solution to eradicate a dishonest tax on society by rentiers is not just implemented. It are the countries that create money, so buying the debt of countries is just money creation. What better way to use this money than to get rid of the debt of the countries. Or are the lenders that live from their interest without any effort so strong in the world that it is impossible to shut down this income stream?
We should try capitalism for once, instead of different type of social democracy (aka socialism). Let’s try a limited government with only its core functions: to preserve individual liberty and protect private property. And let private competition in a free market prevail. That should cut government debt.
Get rid of the debt system because each day they make more money from interest they put on debts and you are going to suffer by paying more taxes, more fares than ever and the sad part is that most of the money don’t go to the state they go back to the banks (IMF). For real, can’t you see they are winning on every front. Governments make it easier for people to get into debts with the bank especially on foreign currency which obligates the state to buy more money for the banks so it can later pay back with interest. Why do you think debts are always increasing?
Wake up people, fight the debt system and the economies will flourish. 😉
Get rid of the debt system because each day they make more money from interest they put on debts and you are going to suffer by paying more taxes, more fares than ever and the sad part is that most of the money don’t go to the state they go back to the banks (IMF). For real, can’t you see they are winning on every front. Governments make it easier for people to get into debts with the bank especially on foreign currency which obligates the state to buy more money for the banks so it can later pay back with interest. Why do you think debts are always increasing?
Wake up people, fight the debt system and the economies will flourish.
What debt? News say German gov is flooded with money, but the one option they definitely don’t want to consider is giving money back to the small taxpayer. Typical.
il debito pubblico che per principio va ridotto…..è uno spauracchio ,un finto problema (è una ruberia ) inventato da chi vuole distruggere la sovranità dei popoli assieme ai loro diritti .public debt which in principle should be reduced ….. is a bogeyman, a false problem (it’s a robbery) invented by those who want to destroy the sovereignty of peoples, along with their rights
Michele When you have massively increased the public debt at low inflation and low interest rates it might work but when inflation & interest rates start to rise again then what ?
The EU is becoming a liability to the global economy.
Thanks for the read, personally I’m very happy the EUR is losing strength against the dollar, our companies can export better (the company I work for has suffered a lot in the past due to stupidly strong EUR). This is of course a personal opinion, I don’t know what would be the ideal EUR/USD tradeoff for the eurozone. Surely Italy has been strongly penalised by the strong EUR.
Man, you hardly know what’s going on in Italy, yet you bring it up constantly. You haven’t seen what a shitshow it was and how hypocritical it turned out to be. We brought this to ourselves, the EU gets no blame here.
‘countries have always had debts, and they reduced their debts by borrowing more money’.
You don’t reduce debt by borrowing, you increase the debt burden that disproportionatly affects the very people you claim to support.
*Social Democrats (More Marxists)
‘common issuance of EU government bonds’.
The EU is not & never will be a Nation so it cannot issue government bonds, is that really all you have ?
*Greens (Not taken seriously by anyone with more than two brain cells)
‘Financial Transactions Tax, or a common corporate tax base, or wealth taxation inside the EU’.
All proven to decrease investment and increase capital flight with the result of general taxation increased to make up the shortfall thereby increasing unemployment, decreasing productivity & competitiveness and plunges the economy into a death spiral.
*Liberal Democrats (Why do they still exist)
Unusual nonsense so can be ignored completely.
* Centre Right (Reason Speaks)
‘The European People’s Party (EPP) would cut government debt by promoting budget responsibility and measures supporting economic growth.’
Logical but I would add low income safeguards.
*Conservatives (Steady & stable)
Usual proven conservative policies.
Logical but it was interesting to hear him emphasize the point that he was speaking as an ECR MEP and not as a British Conservative.
*Eurosceptics (Speaking for the people)
We are facing a political battle to opt out from the euro. Indeed, in our opinion the European currency – a de facto foreign currency – is the main reason behind the high government debt in many Member States, such as Italy.
Hit the nail on the head, logical next move – Leave the pointless EU.
Stop corruption, in countries like Portugal, for instance. We are paying a lot for the Oligarchs. The Banking system was full of toxic investments. In Portugal Justice is not functioning the way it should do I don’t know one single corrupt in Jail.
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Well, you know debt is not the problem, it only became the problem because of Germany. Over the centuries, countries have always had debts, and they reduced their debts by borrowing more money. Today, however, it has become a major problem because Germany has imposed its own rules of governing that have more to do with family economics than the science of economics. All major economists – including Nobel prize winners like Paul Krugman and Joseph Stiglitz – say debt is not the problem. The problem is that we have no growth.
Our major concern is that debt is continuing to grow, and especially when we look at the figures for 2015 we see that it has grown considerably not just within the Eurozone but across the EU-28 as a whole. Clearly, the way to address it is by fostering greater economic growth, and so we have been looking at how we can enable more growth and more money into the real economy. But the second element of it is clearly looking at the restructuring of some elements of public debt. I think that’s definitely needed in some places, like Greece, so that it is not unbearable for public services to be provided to people who need them. So, we should be looking at longer maturities and lower interest rates for debt.
Well, I think there has been a focus on cutting public expenditure in order to cut public debt over the last few years. We, as Greens, would rather look at how we can increase the income side of the equation. So, for example, when we look at a Financial Transactions Tax, or a common corporate tax base, or wealth taxation inside the EU, we are looking at ways to increase public budgets in order not to create more debt, and at the same time to have the expenditure needed to boost the economy in a sustainable way. Over the last few years this has been neglected and has created a major economic and social crisis.
The European People’s Party (EPP) would cut government debt by promoting budget responsibility and measures supporting economic growth.
We are facing a political battle to opt out from the euro. Indeed, in our opinion the European currency – a de facto foreign currency – is the main reason behind the high government debt in many Member States, such as Italy.
114 comments Post a commentcomment
UPR
With zero interest there is motive to increase and not to cut government debt.
They are all wrong. The economy no longer requires cheap labour, mass production and consumption. In a world with finite resources, perpetual growth is per definition unsustainable. And in a society where material needs are mostly covered, we will have to find new ways to measure real development and fairly compensate people’s contributions towards a better and more sustainable economy and society. We have to move past the left-right divide that only focuses on material distribution, and move into the 21st century.
Societies only develop when the middle classes grow and poverty shrinks – when inequalities are reduced and general well-being improves.
As far as debt is concerned we should indeed make a distinction between good debt for investment and bad debt due to inefficiency, but not forget illegitimate debt due to corruption and abusive interests.
In the short term, Europe should come together to properly address the problem of tax evasion. If large companies and fortunes would actually pay the taxes they are due, like everyone else, we would not have the budget deficits that lead to ever increasing debts, or the competitive disadvantages that lead to increasing inequalities. We don’t need new taxes, just that everyone pay their fair share.
I agree with you Marco, but I see not only large companies should pay taxes as they already employ people that pay taxes and officially play in the open market, but businesses avoid to pay taxes being in the black market and protected by local government and authorities including politicians. I see illegitimate debt due to corruption and abusive interest is against democracy and try to rule in power for a long time irrespective the names and faces you see to create an empire with own rules and concentrate resources and real opportunities in a circle of few initiates and protected decision maker undermining any effort to real development might put on doubt their congregated community. Europe shouldn’t tolerate any essential broken principle if we want to develop us as a team as you said. The team of corruption and without sound and fair principles is more dangerous than several different states playing their fair and regulated own role in the market.
@Marco Peel
For countries like Greece or Italy, its not just large companies not paying taxes – its large numbers of citizens not paying taxes too.
The EU should base contributions inclusive of the black economy of various systemically corrupt EU member states.
il debito pubblico se sovrano è la ricchezza dei cittadini . Chiusa UE , euro ecc…. finisce il problema del debito pubblico ESTERO . Il problema non è il debito pubblico ma il debito estero . Come si può votare uno di queste forze politiche ad una domanda che sappiamo che è falsa ?
get out of EU, every Country must solve there own problems
Remove benefits . EU is not that people can travel round and search for “the best benefit” . We should remove such kind benefits everywhere in the EU , EU should destroy tax havens and stop financing church and other religious organisations.
@Vinko Rajic
Please kindly provide me with information on how the EU finances the church and other religious organisations – thanks.
Thank you <3 :)
This is a misleading article and no one has pointed out that public debt and government debt is totally different has is interest rates set by EU member countries totally different than interests rates set by the banks and other money lenders. The only way to cut public debt is to make it harder for people to borrow money its as pure and simple as that.
Neoliberal agenda explained in the images… now I see to whom “debating Europe” is working for…
Il debito pubblico è un deterrente solo per il popolo non per chi governante egoisticamente e stupidamente. Lo si evidenzia solo quando i ricchi ed i politici debbono speculare…cioè rubare.
The EU, as a while or individualy, will NEVER stop the raising debt because the money is spend to fill politicians, friends, family, corrupt enterprises, etc etc….pockets. If their gains were ONLY cut by half, Europe’s economy will grow, not needing austerity.
@DEBATING EUROPE
Your graphic failed to mention that the UK also helped the Eurozone in its financial crisis. Specifically, the UK loaned Ireland billions of pounds to help save Ireland’s banks.
Help countries like the A8 and Greece which have suffered from de-population of late AND move ALL refugees coming from Syria and Eritrea and Iraq and Afghanistan to the A8 and Greece!
After all immigration is always a net contributor to a country’s economy and in say Romania or Bulgaria they have seen their populations shrink by millions of late and they could do with a financial boost.
Money is a social construct. There is no such thing as national debt.
Not despite, because of… Is it so hard to understand the concept of fiscal multiplier in post crisis era?
Still talking about bulls**t? Because of austerity, not despite… Stop financing neoliberal universities
The communist party has certainly the best alternative:No private banks anymore no public debts anymore. Easy!
Stop buying and sending manufacturing to China. Pause on illegal immigrants.
None of them. All ballot papers should have a “none of the above” option and if ‘none of the above’ win then people should be able to elect individual good people to parliament instead of greedy self-seeking politicians.
None
Noone
Ha! Finally it doesn’t work…
After eight years of Austerity measures that have only resulted in stagnant economies, long term unemployment, increasing inequalities and spiralling public debts, we’re still asking what the problem is? Europe now looks more like it did at the beginning of the 20th century than at the end. Have we learnt nothing? The EU would do well to remember its founding principles of diversity, cohesion and democracy, for they have become nothing but hollow slogans in an open market of sheep for wolves. The only way we can win, is as a team.
Austerity measures only help the rich get richer and cuts down on needed revenue
A problem nobody managed to solve yet- nor was any answer from the 7 parties useful! Eurosceptics Laura Ferrara (EFD) comes closest- “opt out from the euro”. EU monetary “rules” like the 60%-of-GDP limit & <3% annual deficit are unenforceable & unworkable. My humble suggestions (sorry for the length):
Since all debt- be they called government, national, public or sovereign debt (all the same) has to be repaid by its taxpayers one day- sooner, eventually or later- THEY must decide HOW it’s done! Bankers know- a government will/can never default!
The ECB/EU/Brussels is not a sovereign country, failed this test over ~20 years, gambled its mandate away and therefore must return the financial toolbox to each (still diverse & unequal) member. In order to reduce & spread the (global) risk- everyone becomes once more financially responsible (no blame game), therefore:
* All countries need to regain full sovereignty over ALL their affairs.
* EU to be "reduced" to a think tank, consultant & facilitator. This will save money- (but not EU's face) in the process, sorry!
* All should obtain (yet elusive) “direct democratic” decision making power over own level of indebtedness & their consequences.
* Monetary, fiscal & central bank policy decisions returned to members. ECB abolished- shares returned, Draghi becomes unemployed (sorry Sir!).
* Educate the electorate about various options of monetary & fiscal policies and the importance and advantage of a balanced annual budget and future debt reduction. (sorry again ALL Private banks, IMF, WB & Rothschild)
* Prohibit borrowings from all private banks- use them only for transaction accounts.
*Government debt will only be sourced from taxpayers directly- as approved, as and when required- ending the use of an “AGENT” (Banks). The savings in bank profit, interest costs will benefit all taxpayers, prevent corruption & reckless trading in government debt (bonds). Own CB/Governments will decide on monetary (creating money) & fiscal measures (tax matters).
* Funds required for private investment to be separated & raised from private banks & subject to market forces. This will reduce taxpayers exposure to unnecessary market risks & manipulations.
* Taxpayers will be freed from the feeding frenzy of Banksters financial engineering.
* Private banks limited & "forced" to return to responsible lending, deposit taking and a tool for conservative saving.
It sounds rational; however, the winners of this euro-madness (namely, Germany) will opt for the destruction of PIIGS instead of losing the milking euro-cow.
Yes George, the (EU) preamble states: “Disziplin und Gehorsamkeit ueber alles”
It sounds german to me and I can’t understand it. Sorry! State it in English, French or Greek pls.
George sorry, in translation it confuses historical glory – google the German anthem!
None of them, it’s all illusion to keep the people down!
Only by being responsible on Budget which is integrated to EU policy you can manage the EU.
of course it has. and economics have been shrinking to double the pain. that’s what happens when policy is completely dictated by corporate profits.
Simple. Have the ECB buy up all eurobonds and fund future deficit spending by simply giving the Eurozone states money.
This is what would have been done from the start, if the Eurozone was a well-intentioned organisation.
public debt? auahauahau http://www.zerohedge.com/news/2016-02-03/it-time-panic-about-deutsche-bank
Even billionaire Warren Buffett says: derivatives are “financial weapons of mass destruction.” Our friend “Mad” Max Keiser warns since 2013 about the (self)
destruction of “Deutsche Bank” & lots of wealth.
If one has any money left- rather find an “old mattress” – not a bank! Any distant relationship between reckless Banksters & reckless Politicians? Interesting times!
Latest update on gamblers & banksters how to………. “cut”:
http://www.zerohedge.com/news/2016-02-07/deutsche-bank-signaling-new-banking-crisis
This FB is more stupid than EU itself
It is essential to develop masses of wealth creation jobs and new businesses and reduce unemployment and give those on low paid jobs better chances to improve their incomes. If this is done it will then be possible to receive more taxation and to use that extra money to reduce debts…improve services and reduce taxation etc. It might take 5-10 years but it seems to be the most obvious idea and it will improve many people’s lives.
Opt out!
Increase state incomes not just cut on expenses. Force people who received social benefits to work and contribute to the society. Nationalise bad performing banks that receive bailouts. Energy companies should all be public (and be franchised to private investors for better management). The territorial integrity of a Country should cease being a taboo (unproductive regions that represents a burden for some Countries could be sold to others making a win-win for both ones). State owned industries should be reopened using unemployed people as labour force.
I governi dei Pasi europei possono solo governare ma non possono decidere.
Despite austerity? Because of austerity more like.
Austerity only has brought ruin to Europe!!!
I think that the first thing to do is stop sacralizing “Public Debdt” concept itself. It isn’t but a convention based upon a set of “economic rules” that have been set up along centuries by prestamists. t is time to move to a new, more human focused, set of rules and concepts.
In the other hand, the big problem with public debdt is the awful fiscal policies which prevail in most European (and non European) countries. A more social oriented fiscality is na urgent need.
And, yes, to get to set up that new social fiscality, we need more economic, SOCIAL and political union in Europe.
Just a little comment: I DON’T want to register to have the rght to vote! :-(
ten reasons we would be BETTER OFF OUT…
1. Freedom to make stronger trade deals with other nations.
2. Freedom to spend UK resources presently through EU membership in the UK to the advantage of our citizens.
3. Freedom to control our national borders.
4. Freedom to restore Britain’s special legal system.
5. Freedom to deregulate the EU’s costly mass of laws.
6. Freedom to make major savings for British consumers.
7. Freedom to improve the British economy and generate more jobs.
8. Freedom to regenerate Britain’s fisherie
9. Freedom to save the NHS from EU threats to undermine it by harmonising healthcare across the EU, and to reduce welfare payments to non-UK EU citizen
10. Freedom to restore British customs and traditions.
Not a surprise none of the governments are interested in creating real wealth and growth. And many of them are even enslaved to the money masters.
I agree with Marco Peel…they are all wrong.
How right is Marco Peel? “The only way we can win, is as a team”! Well, well…. another hollow slogan?
The political EU is not a soccer team or united corporation! How true & relevant is “team work” within a diverse, complex & competing political environment (called democracy) like the EU28- with 7 competing parties? Could “Team work” be or become undemocratic or counterproductive? Should it rather be cooperation, tolerance, compromise & consensus?
http://www.action-wheel.com/democratic-leadership-style.html
It is partly due to excessive austerity. The US recovered much faster than Europe because there was less austerity. Also Europe has an obsolete system with excessive taxes, excessive protection for incumbents in business and labor, and rigid labor markets.
Please; could anyone of you explain to me where this global bebt comes from? From the outer space?
Y pagaremos los que hemos cotizado más de 40 años ala seguridad social, manda cojones, lo que hay que hacer que los Políticos no gané las burrada de sueldos y dietas y aforado que hay E U y en ESPAÑA, menos sueldasos …….
Estos son los resultados de la política austericida!
Han bajado los intereses, pero ha aumentado la deuda: es evidente que el tratamiento no era el adecuado
Hoy vivimos un tipo de dictadura peculiar, que beneficia a politicos y especuladores profesionales y tecnocratas., y el ampliar la corte de beneficiarios y usar ( en modo simulacro ) los procesos propios de una democracia formal, enmascara eficazmente este caracter dictatorial otorgando una apariencia de normalidad democratica, donde y cuando las mayorias sociales nos vemos d sometidas al arbitrio y abuso de estos tuzaros que han traido y siguen insistiendo en , anhos de penurias y oscuridad propios de hace un siglo, las conquistas sociales reconvertidas en derrota y abandono, la ciudadania asiste a la expulsion supuestamente legal de su vivienda, se financia con dinero publico la ensenhanza privada y se depaupera la publica, se repite esto con la salud publica, el trabajo ya no nos saca de la pobreza, aceptamos la mortandad y el hambre infantil como cosa normal e inevitable, la exclusion social funciona como amenaza a la puerta de cualquiera, se alimentan desde los servicios de inteligencia, fanatismos religiosos, guerras y diasporas, xenofobia social como respueesta.. Esos tipos tipos que vemos en esas conferemcias internacionales, tan lustrosos, pulcros engominados y satisfechos, tomando decisiones por y sobre nosotros,… son nuestras sanguijuelas, criminales con corbata.. no dejemos que nos cuenten lo de sus votos con esa jeta de nuevos ricos que se gastan, sabemos en que condiciones y con que contubernios conquistan sus votos, y (creen ellos) nuestras vidas.. Vamos a entregar a su avidez de chupasangres, las vidas de los jovenes, sin derechos, ni opciones a defenderse de lo que se trama y conspira contra ellos?
The appeal to a modrat increasing of dbt is the one political to do.Is the Community available to modify euro value in nations who are an hard debt to regulate?
Bring BACK the Industries from China and give work BACK to the Evropeans AND send back to where they came from the INVADERS.
PERIOD !!!!
On the Fractional Reserve Banking System and the creation of debt. To be watched:
https://youtu.be/HbvCxMfcKv4
Subventions in europe should dissapear
The monetary system is a debt based enslaving system. You can’t eliminate debt without changing the system.
The Euro is the biggest obstacle to the development of the country and its passing is possible only with the recoveryof monetary sovereignty not as an end in itself but to enable a growth policy of full employment for economic growth and social development
There is some market class in the world that was not rigged financial markets were in any way defraudend by drugs Bankers and policians should be investigated by your fancy
The solution is simple. Tax the mega-rich and corporations. Slap a wealth cap on both of them. And for corporation give them a flat-rate lower tax on their gross income thereby bypassing the tax avoidance loopholes and tax-haven problem. Also charge them interest for their loans and give interest-free loans and no tax to the public. They will still be mega-rich and the people will prosper a little more.
A start to put thing right is to pay off the deficit and debt and make it illegal for any government to run up debt or even sell debt on the bond markets, This will mean they will have to live within their means and have an incentive to make the economy grow so they can fund their spending plans, pet social engineering plans. and engineered re-election prospects.
Cut size of government their pensions and pay
By dumping the euro!
dispite austerity? austerity is responsible for that but wont change as germany gains from that
1. In your question, you assume government debt has to be cut because you think the government is like a household that has to repay its debt by raising taxes in the future, burdening future (mine included) generations. It’s false, it’s a myth. Government IS NOT like a household because usually it is the currency issuer, it can’t run out of money. It can happen only if there are self-imposed constraints (debt ceilings, fixed exchange rates etc.) or if the government isn’t the currency issuer (Eurozone).
2. By focusing on such things like deficits or government debt, you’re missing the point: the point is the REAL RESOURCES AND THE REAL PARAMETERS. How to close the terrible output gap, meaning how to put everyone to work? With high unemployment and low capacity utilisation, real goods and services aren’t produced and their benefits are foregone, FOREVER. How to break up oligopolies, leave out rent-seeking agents and shape the bargaining process to guarantee non-inflationary growth. How to modernise the productive apparatus in countries like Italy, who lag behind. What type of education do we need to create competitive markets and the economy of the future? When do we stop financial markets from gambling with our money? How to reduce PRIVATE DEBT? How to balance the current account?
3. If you want to reduce the debt/GDP, the most constructive way isn’t austerity, it isn’t by inflating it away, but by promoting growth through public investment and fiscal stimulus.
What about the EU debt? What about the audit of the EU budget? Bloody EU-morons!
GOD
change income tax, to purchase tax. and charge the global companies a tax on every thing they sell. make estate agents who let properties for other send details of who rent is being payed to with there Nat insurance number, as the tax man never finds out that a lot of people rent out properties and get an other income.
Why has it risen?
Is the EU paying too much for the banks’ mistakes?
Are politicians not accountable for their decisions?
Is everyone paying their dues?
What about the 1%?
What about the international corporations?
What about the fiscal havens?
Are specific countries more in debt than others?
Transparently answering these questions would be a good start?
By the way, the Dow Jones chart in the picture is misleading!
It is a 2008 chart. Change it, please!
Why has it risen?
Is the EU paying too much for the banks’ mistakes?
Are politicians not accountable for their decisions?
Is everyone paying their dues?
What about the 1%?
What about the international corporations?
What about the fiscal havens?
Are specific countries more in debt than others?
Transparently answering these questions would be a good start?
By the way, the Dow Jones chart in the picture is misleading!
It is a 2008 chart. Change it, please!
More welfare. howgh!
Why has it risen?
Is everyone paying their dues? Like the 1%?
Or international corporations?
Is the EU paying too much for the banks’ mistakes?
Are specific countries more in debt than others?
Transparently answering these questions would be a good start?
By the way, the Dow Jones chart in the picture is misleading!
It is a 2008 chart. Change it, please!
It is obvious. Governments refuse to act on it. EU is going against its peoples
.
Stop wasting money on the pointless EU.
Very simple. The ECB buys the bonds and burns them. Nobody feels anything.
Strange that the simple solution to eradicate a dishonest tax on society by rentiers is not just implemented. It are the countries that create money, so buying the debt of countries is just money creation. What better way to use this money than to get rid of the debt of the countries. Or are the lenders that live from their interest without any effort so strong in the world that it is impossible to shut down this income stream?
Brexit
the austerity is the reason that debt is growing, Solution 1. Get terorist Germany out of eurozone 2. someone remember Keynes?
Pay your debt and shut up.
cutting the government
yes!
Stop corruption. Its enough.
Creating more jobs and opportunities, collecting the fair share of taxes from the rich and corporations !
Stop spending more than you pay back, maybe?
We should try capitalism for once, instead of different type of social democracy (aka socialism). Let’s try a limited government with only its core functions: to preserve individual liberty and protect private property. And let private competition in a free market prevail. That should cut government debt.
Get rid of the debt system because each day they make more money from interest they put on debts and you are going to suffer by paying more taxes, more fares than ever and the sad part is that most of the money don’t go to the state they go back to the banks (IMF). For real, can’t you see they are winning on every front. Governments make it easier for people to get into debts with the bank especially on foreign currency which obligates the state to buy more money for the banks so it can later pay back with interest. Why do you think debts are always increasing?
Wake up people, fight the debt system and the economies will flourish. 😉
Get rid of the debt system because each day they make more money from interest they put on debts and you are going to suffer by paying more taxes, more fares than ever and the sad part is that most of the money don’t go to the state they go back to the banks (IMF). For real, can’t you see they are winning on every front. Governments make it easier for people to get into debts with the bank especially on foreign currency which obligates the state to buy more money for the banks so it can later pay back with interest. Why do you think debts are always increasing?
Wake up people, fight the debt system and the economies will flourish.
If you don’t know please go home. We have only 1 life !
What debt? News say German gov is flooded with money, but the one option they definitely don’t want to consider is giving money back to the small taxpayer. Typical.
Agreed. Germany is destroyng the EU
il debito pubblico che per principio va ridotto…..è uno spauracchio ,un finto problema (è una ruberia ) inventato da chi vuole distruggere la sovranità dei popoli assieme ai loro diritti .public debt which in principle should be reduced ….. is a bogeyman, a false problem (it’s a robbery) invented by those who want to destroy the sovereignty of peoples, along with their rights
Ma non diciamo cazzate
di cazzate ne abbiamo sentite anche troppe in questi ultimi 30 anni, è ora di parlare seriamente, io lo so facendo . Basta cazzate
Debt with near zero interest isn’t debt,does not need cutting
Stick to the budget. Don’t do contracts when you have do not the money unless it’s for health, formation, security and so on.
Avoid the ‘bail out’ of bunkrupted banks with tax payers MONEY.
Stop spending more money than you recieve
Look to Sweden. Austerity since the 90’s.
Massive QE.
Its already provided €700 billion in QE with little or no effect, how much debt would you pile onto people in the Eurozone ?
Inflation is still low… Hence I would do more!
Michele When you have massively increased the public debt at low inflation and low interest rates it might work but when inflation & interest rates start to rise again then what ?
The EU is becoming a liability to the global economy.
https://www.wsj.com/articles/italy-and-the-euro-crisis-how-we-got-here-1527603984
Thanks for the read, personally I’m very happy the EUR is losing strength against the dollar, our companies can export better (the company I work for has suffered a lot in the past due to stupidly strong EUR). This is of course a personal opinion, I don’t know what would be the ideal EUR/USD tradeoff for the eurozone. Surely Italy has been strongly penalised by the strong EUR.
Man, you hardly know what’s going on in Italy, yet you bring it up constantly. You haven’t seen what a shitshow it was and how hypocritical it turned out to be. We brought this to ourselves, the EU gets no blame here.
My thoughts.
*Radical Left (Marxists)
‘countries have always had debts, and they reduced their debts by borrowing more money’.
You don’t reduce debt by borrowing, you increase the debt burden that disproportionatly affects the very people you claim to support.
*Social Democrats (More Marxists)
‘common issuance of EU government bonds’.
The EU is not & never will be a Nation so it cannot issue government bonds, is that really all you have ?
*Greens (Not taken seriously by anyone with more than two brain cells)
‘Financial Transactions Tax, or a common corporate tax base, or wealth taxation inside the EU’.
All proven to decrease investment and increase capital flight with the result of general taxation increased to make up the shortfall thereby increasing unemployment, decreasing productivity & competitiveness and plunges the economy into a death spiral.
*Liberal Democrats (Why do they still exist)
Unusual nonsense so can be ignored completely.
* Centre Right (Reason Speaks)
‘The European People’s Party (EPP) would cut government debt by promoting budget responsibility and measures supporting economic growth.’
Logical but I would add low income safeguards.
*Conservatives (Steady & stable)
Usual proven conservative policies.
Logical but it was interesting to hear him emphasize the point that he was speaking as an ECR MEP and not as a British Conservative.
*Eurosceptics (Speaking for the people)
We are facing a political battle to opt out from the euro. Indeed, in our opinion the European currency – a de facto foreign currency – is the main reason behind the high government debt in many Member States, such as Italy.
Hit the nail on the head, logical next move – Leave the pointless EU.
do you pay? then i will tell you. my academic background is public management. And I need a job.
Sell Scotland to the EU
Stop corruption, in countries like Portugal, for instance. We are paying a lot for the Oligarchs. The Banking system was full of toxic investments. In Portugal Justice is not functioning the way it should do I don’t know one single corrupt in Jail.
As any household.. spend what you earn. Earn low? Well thats life.