Austerity Not the Solution to an Economic Slump

It has been a while since the media has covered the worlds economic outlook in part because of the recent events that took place in Egypt as well as the George Zimmerman case here in the United States. Today while driving home I was listening to the radio when I heard a statement dealing with austerity that caught my attention immediately. The radio host began to talk about austerity over in Europe. At first I thought it would be the same song however, with a different beat I was going to hear. Paraphrasing what the host said in regards to austerity measures was how the program with all of its spending cuts has not solved the rising debt that the Eurozone block has hoped to take place.

With the austerity program that the Eurozone has been exercising since the financial collapse in 2008 we have seen countries such as Portugal, Ireland, Spain, and Greece have a steady climb within their unemployment rate. Some of the countries listed above have seen their unemployment rate climb to 20% even as high as 27% but the most frightening statistic is how 50% to 60% of young adults are unemployed and unable to find any work. This has also created a migration of citizens from these struggling countries to flood other nations such as Germany which has been able to stave off the economic slump Europe has been witnessed to for sometime.

First off the economic world leaders of the Eurozone have been very hard on nations with outstanding debt and seeking bailout packages. Requiring them to agree to more cuts and less investment in those nations suffering from the economic turmoil. The reason why the Eurozone has yet to stymie off the rise of debt is because the nation has yet to create an economic plan that can not only produce jobs but also a form of revenue.

With the cuts into social programs such as education, retirement packages, and public jobs the Eurozone has cut off its two legs and is now trying to stand upright again. If a country maintains its cuts how can those countries generate the revenue to pay off its bills. Then to add to the Eurozone’s lack of true leadership they demand that these nations continue their cuts just to receive the bailout money to pay off their debt. Now if the money you are receiving from the IMF, European Central Bank, and the European Union are to go to its creditors and not to the investment of the countries infrastructure then how do you plan to create any form of employment?

The money goes right back to the very banks who gave out the bailout packages in the first place. Leaving countries to find ways to generate jobs without any form of money to do it. Whats even more devastating is how the education part is being severely cut off leaving future generations with the question of whether or not they will receive the proper education that they are entitled to receive as citizens of the world and of their country. The most important thing that a person can have is an education and if you take that away from future generations then what type of nation are you setting up for in the future a nation of the haves and have nots?

The Eurozone needs to understand that in order for the ailing nations to get out the slump that they have been in for almost five years they have to take another route instead of austerity the route of stimulus and responsible cuts. Now some say that both cannot be done and my question to that is Why not? The United States installed a stimulus package and even though our economic growth is a bit anemic to say the least, the country has been able to climb up bit by bit to some form of better economic standing. Now this doesn’t mean that the United States is out the water just yet because China the second largest economy in the world had to shave off its projected growth for the remainder of the year. Which is not a good sign but for the country of China to stay at a growth rate of 6.5% to 7.0% is better then Germany and the United States.

If you are able to invest in your country and fund projects such as infrastructure spending you create jobs for constructions workers. This now will have an effect on companies that produce cement, companies that specialize in tools needed to run these projects, and finally restaurants in the surrounding area where the project is being under taken. By having the demand of work orders for these projects may push employers to higher more employees to help fill those orders or future orders.

Now I am not saying that spending in infrastructure would be the solvent for the countries debt problem but it would be a start to begin bringing in some form of revenue cause now you are generating jobs. Investing in public services will also benefit in the long term as well in my opinion. What I wish the Eurozone would do is negotiate to creditors a plan that can work for all parties. Such as a plan to hold off any future payments to its creditors until the Eurozone members begin to see an improvement in job growth. Once unemployment levels begin to drop to six percent or even five percent then the process of paying back those lenders can now be placed back on the table. Or paying a minimal amount that does not require outrageous spending cuts to those countries already suffering a high unemployment rate.

The problems that have erupted in the past five years are man made and because they are man made they are solvable by man. The only problem is that the methods that are being used today are only benefitting one group of people and those are the banks who help bailout these nations. Instead of borrowing more money to just pay off the money they owe which they will also have to pay back in the future they should be using those bailouts to help create more jobs and create a economic circle where money continues to go round and round not from point A to point B because if this plan for austerity does not begin to be lifted then who will know the future of the Eurozone. People have gone to the streets in protest to the pressures being placed on the ailing nations of the euro bloc and only time can truly tell what will happen when the demands of its people are not met.


Reaction to Egypt and the Ouster of Morsi

Yesterday, the Egyptian military removed President Morsi from his seat of governance. However, this was not a move that was planned by the military for their personal interest, rather it was done because the people of Egypt spoke for what they believed in. Then there were rumors of another mass protest in the country of Egypt that was being planned before the ouster of Morsi. Calls for this massive protest was announced to take place on June 30th. Citizens of the country were filling out petitions demanding the resignation of Morsi. Once June 30th arrived Tahir Square was filled to the masses protesting for President Morsi to leave office.

First off when I witnessed the videos of how Tahir Square was filled with protesters I worried on how Morsi was going to react to the events taking place. With the opponents protesting for his dismissal there were also supporters of Morsi who wanted him to stay in power. My fear was that the country might fall into a crisis such as the one in Syria. However, the military stepped in and gave Morsi 48 hours to heed the demands of his citizens or face military intervention.

During the 48 hours a handful of cabinet members from Morsi’s Muslim Brotherhood made their decision to leave the country and forfeit their positions. Once cabinet members made the decision to leave it was only a matter of time when Morsi would no longer be the president of Egypt. Now the Western media and even here in Washington has consider the events over in Egypt as coup conducted by the military.

After hearing the nations that represent the so-called belief of democracy call this change of power as a coup, I can only describe my reaction as being disappointed. As a nation that says we are about promoting human rights and the freedom for citizens around the world I truly felt that the calls of the Egyptian military staging a coup was a strong contradiction to our democratic belief. Millions of Egyptians went to the streets peacefully and chanted for Morsi to step down. Critics of the opponents of Morsi say that he only had one year and it was not enough time to remove him from the presidency.

However, the moves that Morsi made in the one year suggested that improvement was nowhere in sight. Muslim Brotherhood members solely dominated the government Morsi once led and their passing of the constitution did not involve minority groups within the country. He even went as far as consolidating all governmental powers to him self. This in no way sounds like a leader who is going to lead his country through democratic change, in a way sounds like a dictator. Here in America we have our checks and balance system. We have the executive branch, the judicial branch, and the legislative branch all given the task of checking one another use of power within the government. If Morsi was going to take all of the power and consolidate it only to himself then where does the check and balance system come into play.

The United States has stated that they will cut off aid to Egypt because by law the country is not allowed to provide international aid to a government brought on by a military coup. The Obama administration should not be against the events that took place in Egypt rather they should be supportive. We as a country have to understand that the world is not our country where we dictate who stays in power and who goes. The only exception I say this is allowed that the United States has a right to step in is with the situation in Syria where President Bashar al-Assad has used his own military to kill innocent men, women, and children for almost three years.

We as a country have supported leaders of countries who we later classified as dictators. For example the United States at one time supported the Taliban during the Cold War. After the Soviet occupation of Afghanistan we were quick to provide arms and training to the Taliban fighters who eventually pushed out the Russians from their homeland. During the Iraq and Iran war the United States provided weapons to the former Dictator Saddam Hussein. Furthermore, the United Sates once supported Mubarak and when the first revolution erupted in Egypt we were quick to ask him to step down.

I understand that the reason why we involve ourselves in other political affairs is because of our national security here at home. However, do we really have the right to say who should go in power and who should not? The answer to that is no. Because if history has taught us anything is that we pick the wrong people to support and then later on in the years we have to step in and say hey its time for you to go and lead a transitional government. The people of that nation should be the ones to decide whom they want in power. For it is them who will have to live with the laws that their leaders will pass it will be those citizens that will have to feel the brute force of a dictatorship. All the while we sit back and feel bad for those people and agree for a change of government but forget that we had a hand in that one way or the other.

Another example I want to point out is the situation in Iraq today. We have created a nation that is plagued with suicide attacks or IED attacks every day almost. Scores of innocent civilians have been killed and it only seems that the nation is going to break into a full out civil war. The president of Iraq was appointed by the United States, the government as well. Yes they had their “democratic” elections but were they really at all democratic? Our reason for going into Iraq for those who forget was first for WMDs and their link to al-Qaeda. All fueled by every western media outlet in the world. Then when we went in there we found nothing. Then we switched our mission to liberating the Iraqi people from a ruthless Iraqi dictator which in a way is true, Saddam was ruthless in how he treated the Kurds and Shiites.

If that was the case how come we have not created a coalition of the willing to go into Syria and take out President Bashar al-Assad? Do we not see the sense of contradiction here?

Now going back to the aid that the United States has cut from Egypt. I do not understand why we are cutting off their aid when we still provide billions of dollars to Pakistan. Now here is my issue with giving aid to Pakistan. The aid that we give them is designed to combat the Taliban forces that have wreaked havoc in Afghanistan, Pakistan, and other parts of the world. Militant training grounds are located in Pakistan and yet we continue to hand them aid. The logic here seems to be off. We support a country that harbors the very same people we are in combat against and cut off funding to a nation who have spoken for their liberties and freedoms.

The events that have taken place in Egypt have showed me that people will continue to fight for their freedoms and liberties that they truly believe in. They were able to execute this in peaceful ways even though there have been injuries and even deaths reported during the second revolution in Egypt. We cannot discredit the people of Egypt for pursing what any citizen of this world is entitled to, the pursuit of liberty, justice, freedom, and happiness. What happens next we will have to wait and see. The military has done the right thing and with their openness to having every group of Egypt to be in talks of the constitution can offer some hope of an actual democratic process.

To those in the Western world who truly believe this is a coup are only afraid that their citizens have seen that the masses can truly bring change to their country. And with the way things are going on around the world with unemployment and domestic policies, citizens may assemble in the masses and demand change. A change that today’s governmental leaders are not so open to. Just some food for thought.