Harper, Merkel call on countries to rein in debt

[CHIMO]

Source: Thestar

BERLIN—Canada and Germany have issued a joint call for speedier reforms of financial institutions and for nations awash in red ink to pay down their debt — two factors that are fuelling financial turmoil and putting the fragile economic recovery at risk.

The need for renewed action has taken on fresh urgency in recent days in the wake of Greece’s debt crisis and a worrying fallout that has European leaders scrambling to contain the damage.

While the European Union has spearheaded a package of loans to assist Greece, Merkel said the “stability of the Eurozone as a whole is not guaranteed with this program alone.”

“We all have to do our homework and make sure our structures are sound. It will then be more difficult for speculators to gain ground,” she said.



Read more: http://www.thestar.com/news/canada/article/806643--harper-merkel-call-on-countries-to-rein-in-debt?bn=1

[DJ13]

1. I have a radical idea

Why dont you countries start by getting those wealthy a-holes whose asses you saved by spending all that money on to accept massive tax increases as a first step towards reducing your deficits, instead of cutting services to the poor who had nothing to do with your excessive spending the last few years?

[RandomThoughts]

2. Yea, they really better think about that.

It is a really simple thing to figure out.

[PM Martin]

3. As you said.

[CHIMO]

4. Yep

You countries better have a massive tax increase to pay down the debt. That would reduce the deficit.

But the tea-leaves don't show that happening?

[OhioChick]

5. Agreed. n/t

[Iowa]

8. Well said. I agree.

[Lucky Luciano]

9. They don't need to raise taxes at all...

The Greeks need to actually COLLECT the taxes. Browsing around the Internet, it will be easy to find articles about people ownng yachts claiming income of 15,000 Euros per year as common practice. Only a few thousand Greeks reported income over €100,000. Therein lies the entire problem. The speculators were right. They know Greece will not be able to sustain itself in such a culture of tax cheats.

[JDPriestly]

6. Our deficit and privatization

If you look at a chart showing the growth of the American budget deficit, you will see that the deficit really exploded under Reagan and Bush -- the two presidents who most advocated privatization.

Why does privatization increase the deficit? IMO, when private companies contract to do government work, taxpayers have to pay the bloated salaries of private CEOs and other managers from public funds. Public servants do supervisory work for a fraction of the salaries of the private management.

While private companies may pay rank and file employees less than public employees earn, the enormous increases we pay in salaries to management in the private companies mean that privatization, in the end, does not lower the cost of government work. In fact, after some time, privatization increases the costs. Productivity has increased over the past 30 years, but privatized contracts have proportionately decreased. Think about it. The cost of a computer has gone down, and computers have become faster. Fewer employees are needed to do the same work. But I will bet you that a company contracting to do computer work for the government is charging at least as much for its work as it did before computerized work became much cheaper. That's just one example of an area in which privatization has increased government costs and hurt our budget. Think Halliburton.

[Heywood J]

7. Says the man whose proposed budgets would plunge the country back

into the worst deficits ever seen and wipe out all progress made in the last fifteen years of paying down the national debt...