European Crisis: Austerity Measures Cripple Economic Activity & Hinder Job Creation
Channel: SACSIS
Date: 2012-04-12

In early April 2012, Fazila Farouk, executive director of the South African Civil Society Information Service (SACSIS.org.za) made an input at a roundtable discussion in Sao Paulo, Brazil, which focused on how to build "sustainable democracies". On the sidelines of this event hosted by the Friedrich Ebert Foundation, she caught up with Jan Kreutz, advisor to the Party of European Socialists, and talked to him about the debt crisis in Europe.

Kreutz argued that the crisis in Europe was much bigger than it is understood. "It is a crisis of the economic model," he said.

Kreutz contends that the current austerity measures being forced onto European countries are inappropriate. He argues that Europe needs higher levels of employment to stimulate economic activity, which in turn will fight the deficit problem. To achieve this what Europe needs is investment to stimulate job creation and not austerity, which further impoverishes people. 

Kreutz also pointed out the need to tax Europe's rich more effectively as well as the importance of financial reforms to force the markets to redirect money from the electronic financial markets into Europe's real economy.