UAE “Spain needs more than bailout”

 <The Gulf News Editorial : June 11, 2012>

Spain needs more than bailout

Spain — the latest victim of a growing debt crisis in Europe — needs more than a bailout. The $125 billion (Dh459.75 billion) lifeline may give the country a reprieve, but that alone will not solve the country’s economic problems.

Countries like Greece and Spain should be told how to manage their economies. For that matter, a number of European governments need to be taught the same lesson: Back to basics. Cut your coat according to the cloth and don’t spend money you don’t have. The people should also be told to make sacrifices — to give up certain things in life that one takes for granted and to save resources for future generations. In fact, one should start questioning the entire philosophy of deficit financing and raising debts to a limit that becomes unmanageable. Most western countries are suffering from this syndrome.
The latest series of bailouts involving Greece, Spain and the possibility of others tell us that there are some fundamental issues that the continent needs to address as a unified entity.
They need to act as if they are the United States of Europe and not treat each of these economies as parasites. There should be a comprehensive package for a solution, not merely throwing some money in.

Europe is an important player in the global economy. That is why the European contagion is affecting global growth, including that of China, India, the Middle East and the US. It is in everyone’s interest therefore that the continent gets out of this mess fast.

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