Spain close to junk status, French lunacy, Estonian twitters

The rolling disaster that the European Union has become continues,

Spain downgraded again, at risk of junk status, or close to becoming a new bra size at Victoria’s Secret,

Spain’s sovereign debt rating was slashed three steps Thursday by credit rating agency Fitch, which warned that the nation is at risk of being downgraded into junk bond status.
The nation’s debt rating was cut from “A” all the way to “BBB,” the lowest rating that is considered investment grade. And the new rating was given a negative outlook, meaning it at risk for further downgrades.

France’s new president, François Hollande, must think this is a good thing (if he’s thinking)

France intends to lower the legal retirement age from 62 to 60 for a small class of workers, the government announced Wednesday, maintaining a campaign pledge by the newly elected president, the Socialist François Hollande, and partly undoing a major change by his predecessor, Nicolas Sarkozy.

The change will allow people who entered the work force at age 18 or 19 to retire with full state pensions at 60, instead of 62, assuming they have paid into the pension system for 41 or 41.5 years, the period typically required to qualify for full state benefits. Exemptions for short periods of unemployment will be added and those for maternity leave will be extended.

The pension change is expected to bring more than 110,000 additional retirements next year, at a cost to the state of more than $1.25 billion, the president’s office said in a statement, but is to be paid for entirely by a 0.1 percent rise in taxes on employees and companies. The decree is expected to take effect in November.

As if France could afford the retirees it has now??

Meanwhile, the only EU economy with annual growth of 7.6% (a whopping FIVE TIMES the euro-zone average) gets dissed by Paul Krugman.

Yes, the death-panels-and-sales-taxes guy whose blog is richly titled The Conscience of a Liberal, who will tell you that “the French have it right” when it comes to healthcare. The very same Krugman who puts to use the good-old “lies, damned lies and statistics”, or, as Bruce McQuain calls it, statistical cherry-picking.

As it turns out, Estonian president Toomas Hendrik Ilves (background here) saw Krugman’s tweet, and, voila! Flame war!

Go to the link in this tweet,

And maybe, just maybe, you’ll see why austerity may be what has made Estonia grow.

Estonia and Austerity: Another Exploding Cigar for Paul Krugman

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One Response to “Spain close to junk status, French lunacy, Estonian twitters”

  1. Krugman vs. Estonia | Fausta's Blog Says:

    [...] University economist Steve Hanke on why New York Times columnist Paul Krugman is wrong about Estonia‘s tax and spending [...]