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

Reports of Mass Murder on Mediterranean Smuggler’s Boat

Boat sailed from Libya with 750 migrants aboard and arrived in Italy with 569 More

Video New Thailand Hotline Targets Misbehaving Monks

Officials say move aims to restore country’s image of Buddhism, tarnished by recent high profile scandals such as opulent lifestyle, drug and alcohol abuse, as well as child sex abuse More

Study: Dust from Sahara Helped Form Bahama Islands

What does the Sahara have in common with a Caribbean island? Quite a lot, researchers say 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.
Astronauts Train in Underwater Labi
X
George Putic
July 25, 2014 7:25 PM
In the world’s only underwater laboratory, four U.S. astronauts train for a planned visit to an asteroid. The lab - called Aquarius- is located five kilometers off Key Largo, in southern Florida. Living in close quarters and making excursions only into the surrounding ocean, they try to simulate the daily routine of a crew that will someday travel to collect samples of a rock orbiting far away from earth. VOA’s George Putic has more.
Video

Video Astronauts Train in Underwater Lab

In the world’s only underwater laboratory, four U.S. astronauts train for a planned visit to an asteroid. The lab - called Aquarius- is located five kilometers off Key Largo, in southern Florida. Living in close quarters and making excursions only into the surrounding ocean, they try to simulate the daily routine of a crew that will someday travel to collect samples of a rock orbiting far away from earth. VOA’s George Putic has more.
Video

Video Not Even Monks Spared From Thailand’s Junta-Backed Morality Push

With Thailand’s military government firmly in control after May’s bloodless coup, authorities are carrying out plans they say are aimed at restoring discipline, morality and patriotism to all Thais. The measures include a crackdown on illegal gambling, education reforms to promote students’ moral development, and a new 24-hour phone hotline for citizens to report misbehaving monks. Steve Sandford reports from Bangkok.
Video

Video Virtual Program Teaches Farming Skills

In a fast-changing world beset by unpredictable climate conditions, farmers cannot afford to ignore new technology. Researchers in Australia are developing an online virtual world program to share information about climate change and more sustainable farming techniques for sugar cane growers. As VOA's Zlatica Hoke reports, the idea is to create a wider support network for farmers.
Video

Video Airline Expert: Missile will Show Signature on Debris

The debris field from Malaysia Airlines Flight 17 is spread over a 21-kilometer radius in eastern Ukraine. It is expected to take investigators months to sort through the airplane pieces to learn about the missile that brought down the jetliner and who fired it. VOAs Carolyn Presutti explains how this work will be done.
Video

Video Treatment for Childhood Epilepsy Heats up Medical Marijuana Debate

In the United States, marijuana is classed as an illegal drug by the federal government. But nearly half the states have legalized it, to some degree. Proponents say some strains of marijuana might have exceptional health benefits, for treating pain or inflammation in chronic conditions such as cancer, multiple sclerosis and epilepsy. Shelley Schlender reports on a strain of medical marijuana developed in Colorado that is reputed to reduce seizures in childhood epilepsy
Video

Video Airbus Adds Metal 3D Printed Parts to New Jets

By the end of this year, European aircraft manufacturing consortium Airbus plans to deliver the first of its new, extra-wide-body passenger jets, the A350-XWB. Among other technological innovations, the new plane will also incorporate metal parts made in a 3-D printer. VOA's George Putic has more.
Video

Video AIDS Conference Welcomes Exciting Developments in HIV Treatment, Prevention

Significant strides have been made in recent years toward the treatment and prevention of HIV, the virus that causes AIDS. This year, at the International AIDS Conference, the AIDS community welcomed progress on a new pill that may prevent transmission of the deadly virus. VOA’s Anita Powell reports from Melbourne, Australia.
Video

Video IAEA: Iran Turns its Enriched Uranium Into Less Harmful Form

Iran has converted its stockpiles of enriched uranium into a less dangerous form that is more difficult to use for nuclear weapons, according to the United Nations’ Atomic Energy Agency. The move complies with an interim deal reached with Western powers on Iran's nuclear program last year, in exchange for easing of sanctions. Henry Ridgwell reports for VOA from London.

AppleAndroid