The Politics of Austerity

Just when you think that it can't get any worse, it does.

Spain's Conservative Government just announced that as part of its agreement with the European Union (or at least the northerners, let's cut the crap and get to it) that austerity measures on consumption taxes will be imposed to offset the direct lending of assets to the ailing banks.

Yeah, you read that right, money not going directly to help the people of Spain will be paid for by the people of Spain. You can't make this up. We though issues in Greece were bad, this is so much worse.

Granted Pensions won't be touched, among a few other things, but the fact remains that the working people of Spain have to be put on the hook for the mistakes the banks made by the value added tax going from 17% to 21%. It should be noted that the Prime Minister campaigned on a promise to not raise this tax at all while he's in office.

This makes me angry on so many new levels. First of all, not that I support austerity at all, but given the fact the Government of Spain admitted its only their banking system that is ailing and not anything the people themselves could somehow be blamed for, why aren't the banks paying for this bailout on their own? Why are they not being charged a surcharge tax on their transactions to pay for their own survival? I don't care what answer someone may have to defend the banks because this question is indefensible, in my opinion.

Second, once people get jobs, how do you expect a simple 3% raise in the consumption tax to pay for this bailout? The explanation could quite possibly be that once the banks start lending (and making a shitload of money) people will get their jobs back (24% unemployment rate, higher among the Youth) and start spending money again. I wonder how many people are initially going to want to do away with 24% of their disposable cash on a cup of coffee at Starbucks. Oh yeah, this also covers public transit, so I wonder how many trips people will continue to take on the transit system putting other jobs in jeopardy and/or purchase a car and the other ancillary items such as gas and maintenance that the tax will be charged on?

I say this is all initial, but priorities will change and unless wages keep up I don't see how their economy will be sustainable over the long-term. It's quite possible, but highly unlikely given past examples around the world, that Spain's unemployment will stabilize, but everything is forever changed.

Why is no one speaking up? Where is the Labour Movement putting more people in the streets than there are already? Why is no one outraged about this?!?!?! Come on people, this is reality, as MSNBC put it, we still can change this!!!