European austerity may be the end

European countries are growing differences on the austerity policies. Local time on April 22, European Commission President Jose Manuel Barroso made it clear that countries in recent years and the implementation of austerity measures in order to fight against the financial crisis in Europe has reached its limit.

Some analysts believe that Jose Manuel Barroso issued a statement at this time, apparent in a tendency to abandon austerity policies. This behavior may get the support of the state led by France against austerity policies, but it can also be caused by the opposition of Britain, Germany and other countries to support the austerity policy.

Austerity policies do more harm than good

The primary means of tightening through high interest rates to reduce the circulation of currency in the market. The implementation of this policy requires a very strong wrist and flexibility when the country is in economic crisis, austerity policies have considerable possibility of increasing unemployment, leading to more decline in the troubled economy, tax reduction.

Adhere to the austerity policies of countries led by the United Kingdom and Germany.

EU summit in February this year, under the auspices of the German Chancellor Angela Merkel and British Prime Minister David Cameron, European Budget from 1 trillion euros to 960 billion euros, cut part includes the € 1,000,000,000 expenditures of the EU institutions in Brussels, as well as originally used to stimulate the growth of cross-border infrastructure. Germany insists on fiscal austerity, and that any deviation from the policy of reducing the deficit will lead to an increase in the debt burden, lead to turmoil in financial markets again.

Germany this support austerity attitude, Fudan University Centre for European Studies, Professor Ding Chun explained to the "International Finance" reporter, Germany and Britain insist States austerity, in fact, in order to avoid their own for the other countries of the European Union financial nothing deficit aftermath. At the moment Barroso announced to abandon its austerity policies, but also the very moment quite upset.

The biggest problem is not austerity


Yingde, France strongly advocated easing. The current President of France Francois Hollande early in the presidential campaign, if unrestricted free trade and disorderly competition will end, and the end of the tightening policy. He advocated the implementation of "serious fiscal policy to support the restoration of public accounts balance. After taking office, public support rate gradually lower Hollande said the government is necessary to utilize the budget to stimulate growth through the expansion of expenditure. The day before the EU summit in February, Hollande has a high profile, said the rapid appreciation of the euro affect export competitiveness.

In fact, both tight or loose there will not be a role for Europe. Some analysts believe that between fiscal tightening and easing unnecessary choices, in addition to a waste of time and money to toss themselves, will not find out a way out of the economic and debt crisis predicament. The EU only out of the confines of the finances in order to solve the fundamental problem of the EU economy. Due to financial problems, just the appearance of EU issues, deep there is a problem is that the social welfare system in the EU and EU integration. Consolidate the National Federation "understandable, but the real problem-solving requires countries to put aside their prejudices facing difficulties together. Now look at the reaction of the countries, even if the Federation are established the effectiveness still can not seem to achieve the desired effect.