May 7, 2012
Will End of Austerity Break Up Eurozone?
Patrick Smith, The Fiscal Times
With the elections in France and Greece Sunday, both supercharged by debt, deficits, and economic desperation, Europe is about to take a dramatic new direction. The eurozone is turning away from stringent austerity policies and toward those that stimulate demand. President-elect Francois Hollande, the first socialist president since Mitterrand, plans to raise taxes on the rich to meet some of his growth objectives. However, without a credible debt reduction plan, Hollande risks a loss of confidence among investors and bondholders.
TAGGED: France, Greece, Eurozone, austerity