STOCK MARKET WATCH - Wednesday, 11 January 2012

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41. Spanish lawmakers OK $11.5 billion austerity deal

http://hosted.ap.org/dynamic/stories/E/EU_SPAIN_FINANCIAL_CRISIS?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2012-01-11-09-04-03

MADRID (AP) -- Spain's Parliament approved the new conservative government's first austerity measures Wednesday, which aim to rein in the country's swollen deficit with euro8.9 billion ($11.5 billion) in spending cuts.

The measures, which also include income and property tax hikes, were approved by 197 deputies in the 350-seat lower house, where the ruling Popular Party has an absolute majority of 185 seats after a landslide election win in November.

Finance Minister Cristobal Montoro said the measures were severe but necessary, owing to what he called the mismanagement of the economy by the former Socialist government.

"The economy is stopped, we're on the verge of a recession and the accounts are unbalanced as a consequence, among other things, of the deplorable decisions taken by the former government, which only made the situation worse," Montoro told lawmakers.