Euro Zone Grapples With Debt Crisis
The European Commission warns that public finances in half of the 16 euro-zone nations are at high risk of becoming unsustainable
Governments will spend the next year and beyond balancing the urgent need to fix public-sector debt and deficits — without imperiling what appears to be a feeble economic recovery.
(Read more from online.wsj.com)
Commentary by Patrick Barron: Many people support increasing social welfare programs in the U.S. by citing the experience of Europe; that is, that Europe has far more generous welfare benefits than the U.s. and seems to be doing “just fine”. Well, the European Commission itself disputes the long-term viability of many of Europe’s finances.
[But] None of the welfare plans in any of the Eurozone countries are financially sound. They are simply state-sponsored Ponzi schemes that must crash when the demographic reality of a declining birthrate makes their payment impossible.