Austerity Pushes Europe Into Its Second Recession In Four Years

http://thinkprogress.org/economy/2012/12/06/1295591/austerity-europe-second-recession/

By Travis Waldron posted from ThinkProgress Economy on Dec 6, 2012

Continuing efforts to cut spending and reduce deficits have driven the Eurozone into its second recession in just four years, as its economy shrank for the second consecutive quarter. Struggling countries like Spain, Greece, Portugal, and Ireland are still pursuing deficit reduction to rein in their debt, cutting spending to the bone to do so. The spending cuts have driven unemployment to record levels and threatened the continent with a recession that became official during the last quarter, Bloomberg reports:

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Eurozone unemployment reached 26 percent in September. The youth unemployment rate has topped 50 percent and resulted in a “lost generation” for the continent’s young adults. Still, the pursuit of austerity continues.

Lawmakers around the world have ignored the European lesson, though. Australia’s growth slowed last quarter as its government pursued deficit reduction, and in the United States, the so-called “fiscal cliff” brought on by Republican-demanded spending cuts is threatening the country with a bigger austerity package than those that have been implemented in Europe, even with ample proof that the U.S.’s original preference toward stimulus was more effective than the austere European approach.