Italy Pushed to the Brink by European Fiscal Orthodoxy
Submitted on November 12, 2011
By Mark Weisbrot - November 11, 2011
Some of us have been warning for months about the crisis scenario that is accelerating today in Europe. In particular, I have noted that the European authorities were pushing Italy down a dangerous path, in similar fashion to what they did to Greece. The formula is deadly: force budget tightening on an economy that is already shrinking or on the edge of recession. This shrinks the economy further, causing government revenue to fall and making still further tightening necessary to meet the target budget deficit.
