News / Europe

Germany Approves Biggest Austerity Plan Since World War II

Austerity is on everyone's mind as one European government after another introduces spending cuts to try to get deficits under control and shore up the beleaguered euro currency.

Austerity is the order of the day as parliaments across Europe debate how to reduce deficits and where to cut. And, that includes Europe's economic giant.

The government of German Chancellor Angela Merkel has agreed on budget cuts to bring Germany's deficit within European Union limits of three percent of GDP.

Speaking at a news conference in Berlin recently, Chancellor Merkel explained why it was necessary.

These are difficult times, she said, "We cannot afford everything we wish for if we want to create a future."

The aim is to save nearly $100 billion by 2014. It is being called Germany's biggest austerity plan since World War II.

In general, Europe's emphasis on austerity is driven by the current financial crisis, says political analyst Cornelius Adebahr, of the German Council on Foreign Relations.

"We have seen the example of Greece, where there was no more trust in the Greek government's ability to cut down the budget, to contain the debt or to keep it under control," said Adebahr. "So there is a momentum right now that is very much driven by the markets."

The financial crisis was triggered by the Greek government's inability to pay back its loans and by the country's near default, which threatened to drag the euro and those countries using the currency with it.

Germany is a major part of the European Union bail-out plan for Greece, and while its economy is in much better shape than that of Greece, austerity is the order of the day.

And many Germans, it appears, agree.

"Saving is definitely the right way to go", said a German. He warned that somebody is going to have to pay the debt back and it will be future generations.

"We have to start and not postpone it again" said another man. His wife agreed. "I think everyone should do their part, including those who are better off financially," she said.

Germany has traditionally followed a fiscally conservative path and Germans are widely viewed as prudent with their money. With budget cuts on the agenda, the question now is where will they come from and will they endanger the German social safety net.

Germany and most of Europe has a broad social-welfare net - benefits for the poor, for the unemployed, universal health care and good pensions.

Many would not want to give that up. But political analyst Adebahr says many young people do not believe they will get those same benefits in the future.

"Many in the young generation do not believe in the old pension system," said Adebahr. "If you ask them whether they will receive a pension and what age, they say "I am not sure whether I will be in the position of pensioners of today."

Some benefits have already been reduced - including jobless benefits and health care. Plus, the retirement age has been raised and many say it will continue to go up. But many Germans are adamant the austerity burden must not cut too much into their cherished welfare state.

That is as it should be says head of the Berlin stock exchange, Artur Fischer.

"I want to live in a country where people have a minimum to live somewhat of a happy life," he said. "Therefore I am willing to give away, through taxes and through other means, part of my income as a person, and a lot of other people think the same. So, we have a more stable society and we do this consciously."

Strains on the social-welfare net are not new and go beyond the current financial crisis. In general, Germans want that social contract maintained and are willing to save to do so - for themselves and future generations.

You May Like

FIFA Indictments Put Gold Cup Tournament Under Cloud

Experts say US indictments could lead to charges of other world soccer officials, and lead to major shakeup in sport's governance More

Video Seoul Sponsors Korean Unification Fair

At a recent even in Seoul, border communities promoted benefits of increased cooperation and North Korean defectors shared stories of life since the war More

Video VOA EXCLUSIVE: Iraq President Vows to Fight IS 'Until They Are Killed or We Die'

In wide-ranging interview with VOA Persian service reporter, Fuad Masum describes conflict as new type of fight that will take time to win More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Expelled from Pakistan, Afghan Refugees Return to Increased Hardshipi
X
Ayesha Tanzeem
May 28, 2015 6:48 PM
Undocumented refugees returning to Afghanistan from Pakistan have no jobs, no support system, and no home return to, and international aid agencies say they and the government are overwhelmed and under-resourced. Ayesha Tanzeem has more from Kabul.
Video

Video Expelled from Pakistan, Afghan Refugees Return to Increased Hardship

Undocumented refugees returning to Afghanistan from Pakistan have no jobs, no support system, and no home return to, and international aid agencies say they and the government are overwhelmed and under-resourced. Ayesha Tanzeem has more from Kabul.
Video

Video Britain Makes Controversial Move to Crack Down on Extremism

Britain is moving to tighten controls on extremist rhetoric, even when it does not incite violence or hatred -- a move that some are concerned might unduly restrict basic freedoms. It is an issue many countries are grappling with as extremist groups gain power in the Middle East, fueled in part by donations and fighters from the West. VOA’s Al Pessin reports from London.
Video

Video Floodwaters Recede in Houston, but Rain Continues

Many parts of Texas are recovering from one of the worst natural disasters to hit the southwestern state. Heavy rains on Monday and early Tuesday caused rivers to swell in eastern and central Texas, washing away homes and killing at least 13 people. As VOA’s Greg Flakus reports from Houston, floodwaters are receding slowly in the country's fourth-largest city, and there likely is to be more rain in the coming days.
Video

Video 3D Printer Makes Replica of Iconic Sports Car

Cars with parts made by 3D printers are already on the road, but engineers are still learning about this new technology. While testing the possibility of printing an entire car, researchers at the U.S. Department of Energy recently created an electric-powered replica of an iconic sports roadster. VOA’s George Putic has more.
Video

Video Al-Shabab Recruitment Drive Still on In Kenya

The al-Shabab militants that have long battled for control of Somalia also have recruited thousands of young people in Kenya, leaving many families disconsolate. Mohammed Yusuf recently visited the Kenyan town of Isiolo, and met with relatives of those recruited, as well as a many who have helped with the recruiting.
Video

Video US Voters Seek Answers From Presidential Candidates on IS Gains

The growth of the Islamic State militant group in Iraq and Syria comes as the 2016 U.S. presidential campaign kicks off in the Midwest state of Iowa.   As VOA’s Kane Farabaugh reports, voters want to know how the candidates would handle recent militant gains in the Middle East.
Video

Video A Small Oasis on Kabul's Outskirts Provides Relief From Security Tensions

When people in Kabul want to get away from the city and relax, many choose Qargha Lake, a small resort on the outskirts of Kabul. Ayesha Tanzeem visited and talked with people about the precious oasis.
Video

Video Film Festival Looks at Indigenous Peoples, Culture Conflict

A recent Los Angeles film festival highlighted the plight of people caught between two cultures. Mike O'Sullivan has more on the the Garifuna International Film Festival, a Los Angeles forum created by a woman from Central America who wants the world to know more about her culture.
Video

Video Kenyans Lament Losing Sons to al-Shabab

There is agony, fear and lost hope in the Kenyan town of Isiolo, a key target of a new al-Shabab recruitment drive. VOA's Mohammed Yusuf visits Isiolo to speak with families and at least one man who says he was a recruiter.
Video

Video Scientists Say Plankton More Important Than Previously Thought

Tiny ocean creatures called plankton are mostly thought of as food for whales and other large marine animals, but a four-year global study discovered, among other things, that plankton are a major source of oxygen on our planet. VOA’s George Putic reports.
Video

Video Kenya’s Capital Sees Rise in Shisha Parlors

In Kenya, the smoking of shisha, a type of flavored tobacco, is the latest craze. Patrons are flocking to shisha parlors to smoke and socialize. But the practice can be addictive and harmful, though many dabblers may not realize the dangers, according to a new review. Lenny Ruvaga has more on the story for VOA from Nairobi, Kenya.
Video

Video Iowa Family's Sacrifice Shaped US Military Service for Generations

Few places in America have experienced war like Waterloo. This small town in the Midwest state of Iowa became famous during World War II not for what it accomplished, but what it lost. As VOA’s Kane Farabaugh reports, the legacy of one family’s sacrifice is still a reminder today of the real cost of war for all families on the homefront.

VOA Blogs