In Europe, spending cuts fail to ease debt burdens - AP [View all]

[grahamhgreen]

"WASHINGTON (AP) -- Europe has endured the pain of layoffs, wage cuts and tax increases designed to bring government debt under control. So where's the gain?

Far from falling, debt burdens are rising fastest in European countries that have enacted the most draconian austerity programs, according to The Associated Press' Global Economy Tracker, which monitors the performance of 30 major economies.

The numbers back up what many analysts say: Austerity isn't just painful. It can be counterproductive and even make a country's debt load grow.

Many fear the cutbacks will cause Europe to sink into a self-defeating spiral: Higher debt leads to harsher austerity, growing social instability and deeper economic problems. Governments could find it even harder to pay their bills."

Much more at: http://hosted.ap.org/dynamic/stories/U/US_GLOBAL_ECONOMY_TRACKER_EUROPE_DEBT?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT


This story indicates that INCREASED AUSTERITY LEADS TO INCREASED DEBT.

Which could be construed to mean - cutting Govt. and social programs will not decrease our debt. That should be off the table.

So it seems to me, if we want to decrease our debt, we need to increase taxes on those that have the wealth. Increasing taxes on the working class just stunts the economy since the workers have less to spend. Taxing the wealthiest parties stagnant stacks of billions will reintroduce those monies into the system.

Historically, it works, that's what our grandfathers did - closing the loopholes and imposing a 1950's style 91% tax rate on those that can afford it would be a great place to start, IMHO. Taxing existing wealth as in Norway, would be another.

That, and expanding our tax base by bringing our jobs back by exiting the costly trade agreements, and ending the endless wars.

At least, that's what I'm thinking...