The Pain In Spain Remains

Spain continues down the same road to hell that Ireland paved with its good intentions of austerity.

The Spanish government approved new austerity measures and a limited economic stimulus package Friday to ease investor fears about its debt -- and insisted again it was taking strong steps to right its ailing economy.

Prime Minister Jose Luis Rodriguez Zapatero canceled a trip to an Iberoamerican summit in Argentina just to over see a cabinet meeting where the reforms were passed.

The moves include plans to sell off a 30 percent stake in the government-owned national lottery, the partial privatization of airports, cutbacks to a key jobless benefit, tax cuts for small businesses and an increase in the tobacco tax.

And surprise, surprise!  The austerity measures that Spain enacted earlier this year have done nothing to stanch the bleeding.   Cutting jobless benefits and small business taxes...now does that sound familiar?

In May, when markets were spooked by the near-bankruptcy of Greece, Spain cut wages for civil servants, froze most retirement pensions, and made it easier and cheaper for companies to lay people off.

Zapatero's Socialist government also pledged to reform the pension system by Jan. 28, and is likely to raise retirement age from 65 to 67, an unpopular move that sparked a nationwide strike in September.

Cutting pay for government workers and raising the retirement age...also a familiar song here on our own shores.  Austerity is on the way for all it seems, only austerity in this case means the least able having to foot the bill for the wealthy, time and time again.

[UPDATE] In response to the latest austerity plan, Spanish air traffic controllers have gone on strike, closing Spain's major airports.  The Spanish military is now threatening to take over control of the country's airspace.