THE French, Spanish and Greek governments all announced multibillion-euro austerity plans on Friday in the face of popular opposition.

The French budget presented by the Socialist Party (PS) government of President François Hollande is the harshest since the austerity budgets of the early 1980s under PS President François Mitterrand. It calls for 30 billion euros in deficit cuts, including 20 billion in tax increases and 10 billion euros in spending cuts.

The Spanish budget calls for 13.4 billion euros in spending cuts in the fourth major package of austerity measures passed this year following the election of the conservative Popular Party (PP) last November. The ministries whose budgets will be most severely cut include Agriculture, Industry and Education.

Greece’s coalition government—which includes the right-wing New Democracy (ND), the social democratic PASOK, and the Democratic Left (DIMAR)—announced that it will unveil a plan Monday for 11.5 billion euros in spending cuts. Plans for these cuts were first announced in July, but the government initially failed to reach an agreement on how to distribute them.

In each country, the new austerity measures are being pushed through in defiance of public opinion. On Wednesday, millions of workers throughout Greece walked off the job and hundreds of thousands protested in a one-day national strike. On Tuesday, tens of thousands of protesters opposed to the cuts marched to the parliament in Madrid and were brutally attacked by riot police.

In France, Hollande’s popularity ratings have fallen to 43 per cent as job losses and austerity measures antagonise voters who elected him in May.

Spain’s economy is sinking from reductions in national state spending of 16.5 billion euros, 27 billion euros and 65 billion euros passed in January, April and July—combined with deep cuts in regional government spending.

One quarter of Spanish workers and 52.9 per cent of Spanish youth are unemployed, and despite pledges for bank bailouts the economy is contracting. The IMF anticipates a 1.2 per cent contraction of Spain’s economy, though the government’s cuts are based on apparently overoptimistic projections of a 0.5 per cent contraction.

Spain now pays more to service its debt than it spends on unemployment benefits or the budgets of its national ministries. Since the global economic crisis began in 2008, its public debt has more than doubled, jumping from 35.5 per cent to 75.9 per cent of gross domestic product (GDP), and the interest rate it pays on its debt has surged as a result of speculation against Spanish bonds by the banks and finance houses.

Spain’s banks are poised to request another 60 billion euros bailout as the Spanish real estate collapse continues to undermine their balance sheets.

The effect of such policies is most clearly seen in Greece, whose economy is now projected to plunge by seven per cent this year, instead of the previously projected 4.7 per cent. Since the Greek debt crisis began in 2009, its economy has contracted by roughly one quarter.

Der Spiegel reported that, due to this continuing collapse, EU authorities expect Greece’s budget shortfall to reach 20 billion euros. They will then demand more cuts in Greece beyond the 11.5 billion euros Athens is currently proposing. As laid out in July, these include five billion euros in cuts to the Labor Ministry budget (mainly to pensions) and attacks on Greece’s devastated public hospitals.

These massive cuts—the corresponding amounts would be $802 billion in the United States, £82 billion in Britain and 136 billion euros in Germany—will ravage a society in which those workers who have managed to keep their jobs have already seen wage cuts of 30-50 per cent.

France’s austerity package cuts 10 billion euros from the national budget of 376 billion euros by imposing a wage and hiring freeze on public sector workers, imposing a five per cent across-the-board cut in the ministries’ projected budgets, and cutting 2.7 billion euros in health care spending. The Defense, Finance and Ecology ministries are reportedly particularly hard hit, with losses respectively of 7,234, 2,353 and 1,276 jobs.

As for the 20 billion euros in tax increases, half are to be achieved by closing certain corporate loopholes, and half by increasing taxes on individual households.

The PS government and the media have trumpeted the fact that roughly half of the individual tax increases will be borne by ‘affluent’ households.

The fact is that the tax rate for the top income tax bracket is to be raised to 45 per cent, and yearly wage income over one million euros is to be taxed at 75 per cent.—Courtesy: WSWS