Austria: 1000s of demonstrators protest against government austerity measures

[Joanne98]

Source: AP

VIENNA (AP) - Several thousand demonstrators have gathered in Austria's capital to protest against government austerity measures in education, heath care and family allowances.

Police estimated between 2,000 and 3,000 people were taking part in a rally in downtown Vienna which was scheduled to end on a central square in front of Chancellor Werner Faymann's office later Saturday.

Police said no incidents were reported.

Organizers said the rally would be repeated on Tuesday, when the proposed measures, which aim to cut state expenses by euro1.6 billion ($2.0 billion) in 2011, will be discussed in Austria's parliament.



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[JDPriestly]

1. This does not make sense. Why are all the western countries

imposing austerity measures? Who is going to stimulate our failing economies?

I think our governments are driving us the wrong way on a one-way street. These universal austerity programs will lead to human disaster.

What is behind this?

Looks like the shock doctrine to me, but how can our government leaders be so stupid.

Or, are they actually doing this to slow down the damage to the environment but just not admitting it? If so, why push so much of the cost of environmental conservation on the poor, children and the elderly?

If prosperity is the goal, these nearly universal austerity measures are the wrong way to go about it.

[Fool Count]

2. What is behind this? This is a scam to first drive the interest rates on public

bonds higher by claiming that default is a real danger, and then to make us all pay those exorbitant rates with
higher taxes and lower salaries by claiming that default is not really an option and bondholders are sacred.
That's just a way for the rich to still even more of our money, and that's all there is to it.

[JDPriestly]

3. What do you think would happen if several countries and

a few states in the US defaulted? I would bet you that the bonds would be renegotiated. That's what happens on huge real estate deals. I don't think that the defaults on bonds would harm that much. What would really harm our society would be defaulting on the government's obligations to the poor, the elderly and the young. That would rip the fabric of our society.

Remember, wealthy people have been taking a bigger and bigger slice of the pie each year. If they don't want to pay a higher share of taxes to pay back the bonds, seems to me that they will just have to handle a renegotiation on the value of the bond debt or face default. That's the way business works. They took a risk when they bought the bonds.

[Fool Count]

4. Of course, the debts will be renegotiated with creditors taking a substantial

haircut. That's what happened with Russian and Argentinian defaults. In both cases the bondholders
were forced to accept what they were offered and be happy that it was not zero. The fears that nobody
would want to lend them money again did not materialize. In fact,the opposite have happened -
free of crushing debt both countries were suddenly more attractive to new investors, and both
experienced the longest periods of sustained economic growth in their respective histories.
Austerity was not an option in either country, with poverty and desperation already in the extreme,
violent revolution would have resulted from any attempt to take more from the poor. Actually, in
Argentina they started with trying austerity first, but after a year of violent turmoil and three
presidents later default remained the only solution. In the US and EU, as anywhere else, only a violent
popular uprising will force the elite to part with their wealth "voluntarily". They figured the poor and
middle class can be squeezed for a lot more before it comes to it. So prepare to be squeezed. A lot.