Tagged: Debt Crisis

In the streets and public squares across Spain on Saturday night, the cries of a mass movement calling itself the Indignados rang out, railing against austerity measures imposed by the European Union.

In Greece the next morning, Alexis Tsipras, the head of a far-left opposition party, held a news conference to say he wouldn't join a coalition government that continued the path of austerity.

Spain nationalized its largest real estate lender Wednesday night and plans to announce an overhaul of the country's entire banking system Friday.

The country is scrambling to prevent its troubled banks — weighed down by property debts — from sabotaging the whole economy. The Spanish government has only to look northward to Ireland to see what could happen if it fails.

Lessons From Ireland

German Chancellor Angela Merkel made all the right gestures Monday: the obligatory phone call congratulating French President-elect Francois Hollande. She vowed that the two will "work together well and intensively." And she invited Hollande to Berlin after his inauguration and said she would welcome him "with open arms."

But clearly the French election results mark a setback for Merkel and her goal of solving Europe's economic crisis with financial austerity.

Transcript

DAVID GREENE, HOST:

One country that's very familiar with economic problems, Greece, held a parliamentary vote yesterday, and austerity-wary voters dealt a devastating blow to both main establishment parties.

NPR's Sylvia Poggioli reports the conservative New Democracy and socialist PASOK parties failed even to scrape together the necessary minimum to continue their co-governing coalition.

According to exit polls, angry Greek voters have overwhelmingly punished the two major parties that endorsed draconian international loan agreements.

There is no front-runner in sight, but the fringe parties on the left and the right that strongly oppose the bailout terms have benefited the most.

The socialist PASOK and the conservative New Democracy parties that have alternated for four decades — and uneasily co-governed for the last six months — are imploding.