What concerns Warner – and we've written about it before – is that Spanish austerity is just making things worse for that bruised and bloody country. But in making the case for "worse," Warner doesn't really provide the antidote. This is the problem ...
Read between the lines, and the solution that Warner wants seems fairly obvious. It is the standard "Keynesian" one of more monetary stimulation. Open the taps, he seems to indicate, and things will gradually get better. Here's more from his article:
"We are living in a crucial moment that will determine the future of our families, our youth, our social welfare and all our hopes," Mr Rajoy said. "That is the reality. We have to get out of this mess and we have to do it as soon as possible." Well here's a spot of advice. What was announced today is not going to do it.
In economic terms at least, developments in Europe look ever more like a repeat of what happened in the interwar years, where misplaced devotion to the gold standard and inability to resolve differences between creditor and debtor nations forced governments into ever more counter-productive policies.