Friday, October 22, 2010

Economies In Freefall

They're faltering like dominoes, struck one by one by the economic cataclysmic effect of a deeply-felt recession, complicated by desperate attempts to fund themselves out of the recessionary hole, finding themselves painfully headed toward fiscal bankruptcy, necessitating the adoption of austerity measures. European states, one after the other, faltering economically, attempting to enlist the support of their populations in belt-tightening. Count countries like Japan in there, as well.

Unsurprisingly, citizens are snarling in response. Populations that suddenly found themselves on the receiving end of hard times after a decade and more of good employment opportunities, healthy national economies, booming trade, and a satisfying way of life. Suddenly, countries that blithely offered their citizens generous social benefits found themselves strapped for cash. And the welfare services proffered to so many became truncated and mean.

Still, there are some services that are outer-directed that appear to be sacrosanct in nature. Green environment initiatives, for one, to which all national economies to greater or lesser degree, appear to have committed themselves to. With the exception of Conservative-led Western governments which have taken a more wait-and-see approach, not convinced, as per the president of the Czech Republic, that global warming is human-derived.

Austerity is an austere word; not a very appealing thought behind it, the need to conserve and to be prudently concerned. Government belt-tightening everywhere has resulted in fewer jobs in the civil service, and by extension in private enterprise. With the rise of unemployment, people face a grimly worrisome future. Unemployed people cannot spend what they do not have, and the economy suffers further decline.

Governments lead the way, and in the process battle public service unions who feel terrifically entitled to battle employers. The result is not pretty, particularly in a country like France where unions are traditionally bullishly militant. Now Great Britain has stepped up to the austerity-cutting plate, and diminished job prospects for a half-million Brits in the public service, which will surely extend to the private sector with an additional half-million cuts.

In Britain, cuts across the board, from welfare and pensions to government services, police and the military, even the Queen and the Royal Household, along with the country's universal health care and oops, the BBC. What will remain intact is international aid, education and climate change spending. And good luck to all of that. England's debt, deficit, inflation levels are all deeper than Canada's.

The United States' debt and deficit levels parallel those of the United Kingdom. There is a crisis looming in America, with states like California teetering on the verge of bankruptcy, along with Eastern Seaboard states, finding it difficult to pay for the infrastructure and services required to represent an advanced economy. Social security and health care costs in the U.S. will require they go the way of France and Britain.

And Canada is struggling to maintain its momentum of rising above the slow drain on its economy, although it has suffered far less than other G20 countries. The country's net national debt is still in the manageable range, but would represent greater comfort if it were to be speedily brought down. Both federally and provincially. Job numbers are slow to increase and consumer confidence is not yet booming. Waiting for an uptick in the U.S.

Not a very propitious time to start a business, look for well-remunerated employment, buy a new home, plan for a vacation - anywhere, at the present time. Food banks continue to enjoy great popularity.

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