TEc - Defenceless, Austerity is hollowing out Europe's armies - This is an older question made worse by the current economic and financial squeeze

This is a national problem facing nearly each and every European country before it becomes a multinational one, if at all Europe should be taken as the single entity it is far from being!
The scaling down of European defence forces has initiated long ago only to be made worse by the current austerity drive.

My view is that it is a political (choice) issue much before it gets to public budgets and their increasingly difficult bargaining.
A loose and detached view of military needs, mission and purpose has long taken hold in Europe. Many choose to adopt an unwarranted 'peace and love' attitude to international relations.

The history of nations, their interaction, power balances and individual country self-esteem, however, do not comply with such feelings of blissful generosity.

There would be plenty of worthy arguments to trade but when a country cannot achieve a meagre 2% of GDP on military spending - or even attempt to get there despite NATO's standing recommendation - the message and consequence is one of permanent weakness.
Indeed now is the time for national governments to seriously decide on the armed forces and their permanent role.
In peacetime as well as when called upon to flex their muscles.

FT - America's misplaced lecture to Germany, writes Gideon Rachman - my view is broader because Germany is politically bound to the EU.

A more balanced reflection of reality would have us acknowledge both criticisms are right.
The US has had a past history of excessive domestic consumption fuelled by overindebtedness while showing increasing fiscal pressures over many years. Raising the debt-ceiling again and again will always find cause with meeting the needs of the day by the government of the day.

But, shouldn't the question be asked as to what the ultimate ceiling is(?) - the one that tops every other ceiling broken before?
Or is that a minor issue that can be overlooked every time by winning a vote in Congress?

Germany, on the other hand, does show remarkable internal strengths most nations would wish for.
An economy and society not without its weak spots but so far able to check public accounts and a majority of macroeconomic variables consistently.
Except that Germany is no longer a stand-alone country. And has not been in decades.
It is bound, unlike most others in the larger EU and the 17-member Eurozone, to take stock of the EU-wide implications and responsibilities of its own domestic policies.
It is fair to conclude that the single currency has been a boon to Germany while a questionable gamble - to varying degrees - to many others, at the very least.
Despite the fact that the Euro remains a work-in-progress a few practical lessons have been delivered (to those wanting to learn) by the never-ending economic crisis the Eurozone is trapped in.
At some point in time I believe politics that aims higher will have to kick in. Will it?
Or else the common currency will continue to stifle growth and spread imbalances across countries sharing it.


Exactly the opposite of what the Euro's creation envisaged in the context of building a European Union.

Restoring balances in deficit countries must be matched by well-placed stimulus in surplus countries.
Both should go in tandem if ever the EU is to move forward as one.

TEc - A washout - On Italy's contracting industrial muscle

Distressing to read on Italy's continued industrial decline.
If it should proceed unabated then it is not far-fetched to predict a sea change in ITALIA's world standing.
Already the country has become a minor producer of motor-vehicles, a combination of dramatic falls in production with spectacular rises witnessed elsewhere.
Fiat now makes more cars outside the home country.

Figures in the domestic appliances sector are absolutely staggering. They simply confirm that the entire sector is set for complete demise.
The underlying causes for the debasement of Italy's manufacturing are known but is anything relevant being done to reverse it?
Or is Italian business resigned to the workings of the global market and not the least bit concerned about present and future prosperity of the country?
European countries, large and small, face multiple challenges some of which overlap. 

It has been my long held view that if industry continues to slip - as the basic wealth driver in decades from WW2 - very serious implications arise in the immediate but mainly into the future of the region's economy.
It should not be acceptable to solely blame the global economy for it.
If company bosses choose to shutdown operations in Europe to then set up shop wherever only to bring the goods in through the front door as well as the back, then something fundamentally wrong is happening.
And it should have been addressed in earnest already.
Italy's 'once envied industrial base' is therefore structurally threatened from within.
Its shrinkage year on year also means Italy is shrinking multifold.
If the country's top brass - from company board directors to politicians to society's most influential members - are unable to deal with a well-established trend it is because they've pretty much given up on their own country.
Soon they will be overwhelmed with the multiple consequences.

Reply to a comment posted by a fellow reader:

I do hope that I am overstating the case. The coming years will tell.
It is welcoming to know that Italy's trade balance is showing strength. This is certainly owing to the resilience of successful producers who've managed to adapt to changed global market conditions.
While motor-vehicle production may not account for the main chunk of the country's diversified manufacturing it has long been a relevant part of it nonetheless. It is also a pointer and carries a whole host of ancillary producers making components.
Italy's depressed car market still ranks among Europe's top 4. Sales remain in the vicinity of 1.5 - 2 million units/year give or take.
Italian-owned factories abroad - mainly FIAT brands - are filling the shortfall at home caused by those miserly production levels.
Formely FIAT used to operate worldwide from a position of strength at home.
I do believe there are a number of home-grown reasons why this has happened so consistently and so fast.

Anyway, the main point is Italy cannot afford continued relocation of industry.
Should this be the case every effort must be made to halt and reverse it.

TEc - In the dumps - Portugal's plight as I see it, replying to a fellow reader

Economic policy is about striking the right balances - macro and micro - that ultimately provide sound and sustainable growth in a given economy.
As it is there are enough uncontrollable variables beyond reach of any government. This makes it all the more pressing for governments to manage public accounts responsibly.
They owe it to their citizens/taxpayers first and foremost.
Having witnessed the full picture unfold over many years, a close look at the relevant graphs and data gives us the background to the current troubles.

While I agree with you on many points, I also know Portugal's financing needs ratcheted up to a level that became untenable.
Furthermore, the debt piled up to keep the State running and finance non-productive investment - broadly speaking.
It did not go into wealth drivers that might eventually produce returns to help pay the interest on it.
Basically, the trendlines were set upwards while the economy staggered never to show to really benefit from high levels of State spending.

The current administration has had to cope with a country on the brink. The bail-out programme is evidence enough of just how serious the situation had become once financial markets pushed interest rates over and above the 7% threshold.

A country's economy cannot be fired up overnight.
Least of all by government decree or goodwill gestures. Or wishful thinking.

It takes proper planning of national priority investments, good government that frees up private initiative and provides an environment conducive to FDI flows, etc.

Now taxation levels are excessively high choking companies and individuals, turning away foreign investors.
The time is ripe targeting growth as an absolute priority while not losing sight of fundamental balances.

Last but not least, I wish I could agree with you on the wrong premises...

TEc - In the dumps - Portugal's dire straits

My comment will dwell on Portugal only as Greece is relatively out of bounds.I know not, detailed enough, the intricacies of its internal set-up.
Besides, it is too painful to watch the two countries banded together, apparently(?) following similar paths with a time lag.

With an economy in tatters, an exhausted debt capability and a fledgling financial position into the near future one wonders how top politicians still jostle incessantly to reap some immediate short-lived benefit.
Portugal is caught between a rock and a (very) hard place having played itself into the hands of financial markets simply to keep the State going. Unable to generate tax revenue large enough to meet its insatiable needs, the Portuguese State now faces slimmed-down renewal or quick demise in the current format size.

Much is said about the lack of strong and purposeful leadership to carry out long overdue reform.
I would rather say no non-sense good government.
The more it is talked about the less likely it seems to get done.
Some have long claimed the State is unreformable. They might well be right.
If current circumstances do not make reform mandatory, whatever will?

Regardless of short-term obligations and financing requirements the underlying issue remains the economy.
Wealth creation by digging into every material and intellectual resource available that will eventually set Portugal on a sounder footing.
Balances to the country's external accounts have been forcefully restored thanks mainly to the collapse in internal demand and economic activity in general.

Much harder, or the major structural challenge, will be to keep those balances once the economy finally starts to grow.

Reply to a comment by a fellow reader:

I'm definitely not going to be drawn into a play with words.
Anyway, 'now'(in the context) is meant as the point in time when it became obvious State expenditure was growing much faster than paltry economic growth for a full decade at least.
If State spending balloons over many years without the economy matching up then external financing is the only option to fill the gap, i.e. as long as there are interested parties to buy debt.
Budget deficits recur year on year to unmanageable levels, get thrown on to the country's public debt until the debt load itself becomes unsustainable.

Please figure out 'insatiable' in the context.

TEc - Rewarding work - On pay gaps around the world

This will always be sensitive territory raising more questions than there are answers.
However, the more unequal a society, the poorer a country by per capita GDP at PPP, the wider the gap in pay. There are exceptions to this general rule. South Asia is a good case in point if perks and side-deals are not accounted for.

In other words factual evidence shows that poorer States tend to reward their lawmakers lavishly even in absolute terms. On relative terms it becomes strikingly obnoxious to begin to comment.
The worst part is there is no fix to these gross imbalances produced by those with power to satisfy their own notion of payscales.
They have it on their grounds regardless.

At the opposite end affluent societies show much greater balance across the board.
Lawmakers' pay is but a reflection of this.

TEc - On the rocks - Portugal's political infighting set against its severe ongoing economic and financial troubles

"The politicians fiddle while the country burns" is a phrase read many years ago that I now borrow to best describe Portugal's current predicament.
Literally, summer forest fires aside, Portugal is faced with scorching challenges akin to a gutted wasteland.

From the very core of the governing center-right coalition nothing short of implosion took place in the early days of July. First the hitherto all-powerful Finance Minister resigned followed by the Foreign Minister - and leader of the coalition's junior partner - the very next day while the former's substitute was being sworn in. Strains and cracks had always been present as might be expected of a government so forcefully externally constrained. And a people constantly jolted by endless austerity, subjected to never-ending economic and psychological duress.

Portugal's political leadership and much of the country's other leaderships are clearly at a loss finding pathways to future collective prosperity.
In good times as in bad they never could or would see beyond the issues of the day.

TEc - A tandem in trouble - the EU's two core countries show strains in need of quick fixes

A showdown between France and Germany over the EU is inevitable at some point in time. It was always bound to be so in light of an unbalanced bilateral relationship that has only grown worse over recent years.
'The Economist' scoops a few items that make up the dividing line now setting the two EU core countries apart.
Yet it fails to analyse beyond the problems of the day, the political leadership of the day, the issues of the day, Angela Merkel & François Hollande.
The new public partnership(?) between AM & FH is much more reflective of the two countries' identity, domestic tensions and interests, overall performance and relative GDP weight than the previous duo ever projected.

France and Germany - Germany in particular for reasons of undisputed economic strength - have got to hammer out a new routemap for the Eurozone. One that finally addresses political issues as well. The very issues that were dismissed while market finance seemed permanently assured.

Not for me to foretell the future but it does look like contracting economies cannot indefinitely remain in limbo trying to figure out pathways to growth.
Social costs have mounted everywhere with unemployment reaching levels spelling serious damage to societies and their fabric.
The adjustment underway did prove the logical outcome to years of excessive spending.
Cold-blooded soulless austerity, however, has removed all hope for an improved economic environment tomorrow. Even where and when it might eventually come about.

France and Germany, Germany and France have to quickly ensure the policies and means at EU-wide level that will reconnect many with the European ideal - whatever that is meant to be at present.
Their existing gulf must be seen to be closing instead of widening if the EU is to survive into the future.

FT - The limits to all-out unforgiving austerity are ever sharper to read

The political speech across the Eurozone has witnessed a change from austerity into something as yet undefined.
There is no doubt Mr. Hollande's rise to power a year ago has put additional weight into the anti-austerity argument. This is as much about France's own predicament as it is about austerity fatigue starkly felt in bailed-out countries whose desired outcomes are far from clear.

It is of course an uphill struggle to right public accounts when economies contract sharply over consecutive years. Vague promises of economic growth resuming into the future hardly find believers amongst a discredited lot having to make do with ever higher levels of multiple uncertainty.

Europe, the European Union and the Eurozone are facing very challenging times indeed.
Broadly, a multiple whammy has hit the old continent's economy, social set-up and ways that most politicians look utterly dejected when not awkward simply trying to cope. If at all they realize the underlying causes and trends. Because more than a few structural issues are not being discussed out in the open or perhaps even behind closed doors.

I do not see an upbeat path forward for every nation sharing the single currency - that which is a precondition to any successful monetary union - unless an emboldened deal is achieved at European level. Sooner rather than later.
The ultimate objective being to resume and sustain economic growth and employment across every country from north to south, west to east of the Eurozone, the European Union, Europe.

The time is now to find a workable replacement to austerity without upsetting public accounts.

FT - The financial implications of SWAP deals

This is way too outrageous to begin to find proper words that might vent a semblance of anger.

For no other rationalised emotion would ever match the enormity of what is now unfolding.

The Finance Minister is expected to answer questions from deputies in Parliament tomorrow.
But it is obviously Portugal's hard-pressed taxpayers who should be given full explanation.
The Portuguese State - broadly the country's tax take and indebtedness - has over the years been hijacked by the very people entrusted with upholding it.
It is always after the fact - usually years later - that a new deep hole is found invariably to the State's loss. To vested interests' gains at the expense of the already overburdened taxpayers.
On whose behalf both the State represented by the government of the day and concerned interest groups acted.
Unfailingly claiming to act in the best interests of the taxpayer.

I will save my words until after Vitor Gaspar has provided relevant insight into yet another disgusting matter.

TEc - The new collapsing building - Multistoreyed factory building pancakes due to multiple forms of cumulative corruption

Yet another shameful event that may shed some more light on the plight of real people caught up in the big money-making-racket-for-a-few parts of the global economy have become.
Once indignation and emotion subside it will be, more likely than not, business as usual until the next tragedy unfolds, perhaps with a vengeance.
A tipping point may eventually be reached down the line.

One look - not even a close one - at the pile of rubble under whose tonnes many still barely cling to life in agonising pain reveals the whole extent of a multifold scam.
Will not describe it here for the evidence is abundantly clear.
Lobbying, political connections, power games are hardly worth a mention when human misery is the main price that never gets factored in.
As it is the winners are/have been factory owners, some government officials and akin in Bangladesh, nameless middlemen and major household brands over in the West.
Their purchasing managers instructed to source where it is cheapest, sell with a significant yet a little below expensive mark-up on the High Street and pocket the difference.....!

A fair global economy is only achieved when a level-playing-field is defined first and foremost.
General safety of buildings does cost some money - not a whole lot by the way.
Decent working conditions cost a little more.
Negligence, corruption, lack of enforcement of existing codes or any other costs a lot more. Every damn day.

When doomsday accidents like this one strike can anyone who hasn't lost his/her sense of decency put a price tag on it?

FT - Plan envisaging economic growth is presented

The main significance to yesterday's announcement is finally the economy is seen to receive explicit attention from the government. While the approach or measures themselves may come up for close scrutiny they do signal a departure from the near non-issue lack of economic focus had become since the onset of the adjustment programme.

From the government's standpoint the last two years have witnessed a clean sweep that saw thousands of businesses fold up under the weight of recession and a stop to credit flow.

Whether or not healthier parts of the economy will kick up as conditions improve is not known.
Whether or not surviving businesses will perform better into the future remains to be seen.

Targeting exporting companies and setting a goal for the export-share of GDP indicates a policy option based on a vision for the country and its enduring need for rebalancing.

Only time will tell but it would seem a fresh start is being attempted by an embattled government still up against formidable odds.

Hopefully there will be a pick up in economic activity in the Eurozone and EU towards the end of the year.

TEc - Euro wobbles - a common currency that does not deliver equitably across the Eurozone

A very well written to-the-point text that adds to knowledge on Portugal-centered ongoing troubles in the Eurozone.
It does justice to the Portuguese case, specific as it is like every other.
But I vehemently disagree with the subtitle while grasping the intent fully.

Problems in the Eurozone built up over many years of laxed oversight at EU-wide level. While the going was good - market finance seemed to flow easily - apparently no-one at Central Banks, crucially at the ECB and the European Commission, realized imbalances were growing by leaps and bounds to eventually become unsustainable. As they did!

National governments failed to act responsibly just as EU cross-country institutions comfortably looked the other way.
Arguably it seemed the win-win could last forever.
The rest of the story is unfortunately too painfully well-known to all.

How to break free from the current stalemate that has produced millions of unemployed, declining or sluggish economies and a deep divide between the 'haves' few and the 'have-nots' many within the European Union?

Portugal's Constitutional Court is as relevant to the country as Germany's equivalent.
Or any other like-for-like entity in each of the remaining EU25.
In fact its ruling on the 2013 budget is to my mind the sole display of remaining sovereignty from this debtor country since the onset of the bailout.
The government has meanwhile stuck to its guns saying cuts to State spending will be made elsewhere to achieve the now relaxed deficit target of 5.5%. I do not doubt their resolve and ability to deliver.

For their part, creditors must show flexibility where and when it falls due. Portugal has made remarkable strides in a very short timespan at a huge cost to the economy and employment.
A look at each Eurozone-member country as a stand-alone is required for individual analysis and assessment.
A review of the 17-member Eurozone bloc then becomes mandatory if the Euro - our cherished common currency - is to survive and thrive into the future.

Upmost on policymakers' minds should be kickstarting growth as soon as possible.
Even if most clearly remain in the dark on how to achieve this.
At the very least focus has got to be seen to be shared between restoring budget balances, macro balances and domestic economic growth.
Failure to achieve the latter threatens creditors as well.

TEc - Austerity plans overturned - The Constitutional Court snubs the government (and international creditors)

There's at least one strikingly favourable outcome from the Constitutional Court's ruling:
it sends a clear signal to creditors (and outsiders) that if "beggars cannot be choosers" they can still demonstrate there's an internal constitutional-judicial order in Portugal.
What good is that at a time of financial emergency that placed countries well into the uncomfortable lap of creditors?
I do not know but somehow relish the idea that a Portuguese State institution - an independent Court - stood up to pass judgment running contrary to the wishes of both national government and international creditors.

The sovereign-debt crisis in the Eurozone continues unabated.
This is only the latest episode of many concerning Portugal in ways that depict the extent of today's woes.
It is my firm belief, rather certainty, in a long long time - very long before the Eurozone ever existed - that Portugal begs structural internal fixes successive governments have repeatedly walked away from. And society's most influential members have in practice all but boycotted them one way or the other.
At the outset of the current imbroglio I even thought the game was up, the time had arrived for an externally-induced reformist agenda to finally become mandatory.
This remains part true.
But the terms and time frame being haphazardly pursued are just too tight and too short to produce the lasting results needed.

With an economy in tatters, unemployment at historical highs and an anxious society that could suddenly turn restless - those who make decisions from within and from without have got to adjust their mindsets to accommodate many more relevant variables.
Not least the collectively worsened business environment in Europe. Most of all the daily needs of common people...
What's the whole purpose of politics anyway?

Within the EU, to look at a single country as a stand-alone does not suffice.
Not on shared problems borne out of a shared currency.
While the origins and causes of their troubles are different - from Cyprus to Portugal across Ireland, Italy, Spain or even France (not a sovereign-debt issue yet) - they all face common/overlapping consequences that have depressed economies now showing little scope for growth anytime soon.
The UK, though outside the Eurozone, is struck down by the latter's recession but is also up against severe economic and social issues of its own.
Despite retaining tools such as the pound sterling and the Bank of England allowing considerable extra leeway.
Therefore a radical new approach has to be sought out at national level and at EU-wide level.

Which way is Europe headed out to?
Providing the same answers as when Greece's early pains were felt does not seem to be an option any more than piecemeal decisions made to put out a fire here or there.

TEc - A cut above the rest - Homage to Margaret Thatcher

A well deserved title to a neatly structured text full of content celebrating a great politician of conviction.

Mrs. Thatcher left an indelible mark on British politics, economy and society. She also made an outsized contribution to political freedoms as well as economic liberalization worldwide.
Controversial she was, as controversial remain some of her core policies whose outcomes were not always as commendable as might have seemed.

On balance Margaret Thatcher was a staunchly patriotic Briton whose Russian-coined nickname "Iron Lady" best describes her political temperament and actions while leading government. At home and abroad.
Her legacy lives on.

RIP MHT.

FT - Spain, and the threat from Portugal and Cyprus - are there no lessons to be learnt?

If any lesson should be drawn since the beginning of the sovereign-debt triggered Euro crisis it ought to be that austerity in and of itself will not deliver.
Adjustment programmes are to a large extent self-defeating. Shrinking GDPs make set budget deficit targets much harder to achieve.
Countries are found chasing their own tails with a negative spin.
While options are limited at the outset, fact is enough time has elapsed to make compelling assessments on overall outcomes of adopted policies.

Everyone agrees that the Eurozone is an incomplete construction whose major building blocks are missing.
There's widespread agreement too that the whole context is rather complex - politically, financially, economically, culturally, etc - but isn't there a logic arising out of experience?

to the FT - in the aftermath of the Constitutional Court's ruling counter to the government's wishes

The PM is due to make a televised address to the nation later today.
Pointless to try guessing what goes on in his mind as head of government in full knowledge of where Portugal stands.
The Constitutional Court is either a fully-fledged Court whose rulings may be questioned but have to be upheld or a cumbersome institution whose decisions are read according to context and political expediency.
I believe the former to have far more substance than the latter.

It goes without saying that Portugal is under financial assistance.
Does that mean targets agreed with creditors must be met irrespective of all else?
Looking from outside maybe yes but from inside the case is much harder to grapple with.
The government has got two years' record to look back on and realize how unrealistic those targets were.
Governments everywhere are experiencing great difficulty meeting set budget deficit targets even where economies are not shrinking as is Portugal's case. Throwing further austerity on top of austerity already in place is not likely to make things any better.
On the contrary, the downward spiral would only accelerate.
It should therefore not be an option at all.

Portugal finds itself boxed in in a particularly tight spot.
How to break loose by restoring sound growth to the economy remains the only worthy way out. Yet that is a million dollar question no-one is willing to find an answer to!

TEc - Down and out in Paris - France is down along with a President struggling to find his bearings

The Economist's dislike of François Hollande is perhaps unsurprisingly a common denominator to all articles on France.

Popular ratings of a politician should not deflect him/her from pursuing what is required. Bottom line is a simplistic commitment to leave the country better off at the end of the mandate.
One of democracies' worst failings is far too many people in positions of power are constantly worried about public image.
On the wrong side of it.
While it is important never to lose touch with the people by staying connected to them, government is about making decisions including unpalatable ones when the going is tough.

France is no exception at a time when the Eurozone, the EU and Europe as a whole face incredible odds all of which converged to make a bad situation worse.
Even where economic performance and social challenges are concerned France is the pivotal country in the EU.
Unfortunately it now jostles within the bloc rather uncomfortably facing up to Germany clearly from a position of relative weakness.

Regardless of how it is looked at, everything narrows down to this:
it's the economy, stupid!
Especially in the absence of men and women of greater political stature at the helm.
Politics of cause and conviction are sadly missing from Europe over many years.
This explains the pains and troubles of the Eurozone made much worse than they might otherwise be.

French businessmen and cadres will matter nearly as much, if not more, as political staff - under FH or any other - getting France back on a relevant growth path.
Ultimately the only way France will again measure up to Germany, retaking its essential political drive in the EU as well.

to the FT - Anxiety over what the Constitutional Court will decide on 9 items from the 2013 budget

Portugal continues to navigate through very choppy waters.
Sea lanes are exceptionally narrow tapering off into the unknown.

The main significance to today's no-confidence motion tabled by the PS - Socialist Party - lies precisely in that fact. The mainstream party that triggered Portugal's requirement for financial assistance has broken ranks with the government charged with pursuing it to the end.
From now on political acrimony is set to increase to the next level.

Most of what could go wrong with the Troika-imposed adjustment programme - in exchange for bailout money - has indeed gone wrong.
Also, multiple recessions in European countries Portugal does most trade with have meant exports, despite holding up remarkably well in adverse conditions, no longer bring in as much cheer as they might. Their contribution softening the impact of recession was bound to be relatively small anyway.
Yet they offered (still do) just about the only glimmer of hope.

The ruling by the constitutional court is eagerly awaited by all. The government's critical action tool - the 2013 budget - hinges on it deciding whichever way.
Will the judges make a binding footnote provision on the country's financial emergency situation or deliver a purely judicial verdict according to the highest Law of the Land?

Political storms are brewing capping every other storm hitting the economy hard daily.
And a growing number of disgruntled citizens for whom politics is increasingly too far-fetched.

TEc - London's airport conundrum - A complex decision looms that will determine London's airport system capacity

What a great fix it is to decide on such a massive airport system now experiencing real capacity strains.
It will ultimately have to be a political choice based on technical, planning, financial, economic, and environmental grounds.
Yet mainly political.

There are understandably clashing interests at stake which therefore makes any decision highly controversial. More so if expanding Heathrow is chosen.
The commission has plenty of work to busy itself with.
The daunting challenge being at the end of it all a recommendation will have to be made that singles out one winner option.

Shifting the LHRairport platform westwards - with two further runways - seems more sensible on first glance.

However, there's much work to do to arrive at any proposal that adds capacity to London's airport system.

to the FT - José Sócrates is back to claim a voice in the country

JSocrates' return to having a voice in Portugal's lamentable predicament could be put to good use if only the former PM had not become such a divisive figure.

It is the very recent past that's fresh on people's minds. At a time when social conditions in the country worsen on the back of an unbearable debt load and a partly self-defeating financial adjustment programme claiming a heavy toll on the economy.

Yet, was there an alternative back in early 2011?
JS says yes putting full blame for Portugal's bailout request on the politics of the day then.

That's his main line of defense showing no regrets for his two governments' actions over 6 years.
I would wish for an independent economic and financial assessment - very hard to obtain in this country - although it would now be tantamount to no more than exercise for academia.
Could Portugal have avoided the Troika-granted lifeline?

The following weeks and months will reveal JS's real impact on Portuguese politics.

The political world remains largely divorced from the daily worries and anxieties of the majority, I would think.

JSocrates' does have a point on many counts but he cannot deflect from having played a big role firmly setting the trendline of Portugal's public debt on an unsustainable path.

to the FT - On Cyprus

The very idea that the EU's easternmost territory - an island country of 1M - could bring upon itself such grief and uncertainty is mind boggling.
Did Cyprus's leadership actually believe they could muddle through relatively unscathed indefinitely?

The two main industries - banking services and tourism - put Cyprus on the world map while raising levels of development and living standards.

There are many other similar development models around the world especially where islands or small enclaves/territories are concerned.
Can they realistically thrive on oversized banking sectors regardless?
It is a question I have asked myself in ages.

Apparently not.

The EU's approach to Cyprus - one of its own - cannot be condoned but what sort of trade-offs were exacted to let Cyprus into the EU less than 10 years ago and then into the Eurozone in 2008?
Perhaps rhetorical questions don't help now.

The Eurozone remains entangled in a web of diverging variables ranging from hard economics to the cultural within each of its member-countries.
It will be a tough challenge to keep it going in the current format or a new start must be made.

Restoring hope of economic growth to vast regions across southern Europe going up north is paramount.
Ultimately the only way for indebted countries to pay their interest dues on continuously rolling debt.

High Politics, Vision, Statesmanship and basic Good Sense is called for.

to the FT - Cyprus's woes set in context

There's only one reason Cyprus's handling by the relevant parties did not trigger bank runs elsewhere in troubled countries:
commoners find the unfolded/unfolding story too surreal/bad to believe in the first place!

Nowhere are people ever distracted when it is their own money that's on the line. But the very idea that suddenly institutional Europe - bodies supposedly entrusted with pursuing the well-being of entire nations - can raid the people's savings and make a grab is beyond reasonable words.
Was it Cyprus's own leadership who tried to apply lightly differentiated levies on all savings from €500 to hundreds of thousands to the millions?
Just so Cyprus might remain a safe haven for wealthy Russian and other depositors?
In a move brightly designed to appease bigger depositors by spreading the pain across all savers?
No respect shown whatsoever for the vast majority of Cypriots on average incomes with small to moderate to large (yes-why not?) savings?
Lifetime savings for some.

Cyprus's descent to hell brings to the fore (again) a number of very serious questions no-one has been willing to address over many years. Least of all settle for a balanced model.
Fiscal paradise for foreigners to park their fortunes - won't even ask their source - to then get overexposure to Greece?
Is this the main thrust to Cyprus's prosperity?

The limits to unregulated capitalism are clearer than ever.
Banking and finance remain essential to the workings of any society and economy.
An oversized, freewheeling sector that seemingly does well while the going is good represents, besides hefty risk, certainty that at some point in time it will implode.
As usual not before those-otherwise-hateful-taxpayers are called upon to come to their rescue.

Cyprus's original predicament lies in that citizens are doubly burdened, both as taxpayers and depositors.
An affront to honest, hard-working people it was.
A grotesque, nameless and faceless breach of trust whose seriousness cannot be underrated.

A new deal has now been hammered out.
Reads like a meaningful improvement on previous ones.
Some thought was put into the savings of the 'little guy'.
In actual fact no more than upholding the Eurozone's own deposit insurance treshold.

While it may be acknowledged that no solution to Cyprus is equally painless, standing up for fairness must remain top of priorities. Understood as such by every single government official and head of international organizations concerned. At all times.
More so when problems become especially complex as is Cyprus's case today.

An island caught between a rock and a very hard place.

TEc - A better deal, but still painful - Cyprus gives in in exchange for a costly lifeline!

There's only one reason Cyprus's handling by the relevant parties did not trigger bank runs elsewhere in troubled countries:
commoners find the unfolded/unfolding story too surreal/bad to believe in the first place!

Nowhere are people ever distracted when it is their own money that's on the line. But the very idea that suddenly institutional Europe - bodies supposedly entrusted with pursuing the well-being of entire nations - can raid the people's savings and make a grab is beyond reasonable words.

Was it Cyprus's own leadership who tried to apply lightly differentiated levies on all savings from €500 to hundreds of thousands to the millions?
Just so Cyprus might remain a safe haven for wealthy Russian and other depositors?
In a move brightly designed to appease bigger depositors by spreading the pain across all savers?
No respect shown whatsoever for the vast majority of Cypriots on average incomes with small to moderate to large (yes-why not?) savings?
Lifetime savings for some.

Cyprus's descent to hell brings to the fore (again) a number of very serious questions no-one has been willing to address over many years. Least of all settle for a balanced model.
Fiscal paradise for foreigners to park their fortunes - won't even ask their source - to then get overexposure to Greece?
Is this the main thrust to Cyprus's prosperity?

The limits to unregulated capitalism are clearer than ever.
Banking and finance remain essential to the workings of any society and economy.
An oversized, freewheeling sector that seemingly does well while the going is good represents, besides hefty risk, certainty that at some point in time it will implode.
As usual not before those-otherwise-hateful-taxpayers are called upon to come to their rescue.
Cyprus's original predicament lies in that citizens were doubly burdened, both as taxpayers and depositors.

An affront to honest, hard-working people it was.
A grotesque, nameless and faceless breach of trust whose seriousness cannot be underrated or overstated enough.

A new deal has now been hammered out.
Reads like a meaningful improvement on previous ones.
Some thought was put into the savings of the 'little guy'.
In actual fact no more than upholding the Eurozone's own deposit insurance treshold.

While it may be acknowledged that no solution to Cyprus is equally painless, standing up for fairness must remain top of priorities. Understood as such by every single government official and head of international organizations concerned.
At all times. More so when problems become especially complex as is Cyprus's case today.

An island caught between a rock and a very hard place.