Troika Treatment for Greece, The Spanish Way

Spain is catching up with Greece, in a disastrous way: part of the new austerity package negotiated by the Spanish government with the Troika is the decision not to adjust the salaries of public sector employees and workers to the inflation rate. This will be the fourth year of no salary increases, which means a cut in real incomes for more than 500,000 Spaniards. The news was a prominent item in the German DLF radio morning program, today.

The government justifies its decision with the claim that Spain’s official consumer index is down by 0.3% (for August). However, average Spaniards do not have the money to enter the government’s dubious statistics paradise, as shown by the fact that August retail sales fell 4.5% year on year, the 38th consecutive drop (!) by the way. The figures are from the “preliminary data” from the National Statistics Institute (INE).

Along with that murderous measure, cuts in pensions are also featured in the 2014 budget announced by the Rajoy government this Friday. Pensions will no longer be indexed to the inflation rate, but instead raised by a minimum of a mere 0.25% every year, and a maximum of 0.25% over the usually-lying official inflation rate! The “complex formula” adopted to calculated annual pension raises takes into account strictly fiscal considerations, such as the number of pensioners, the financial situation of the social security system and the level of pension payments over many years, and nothing of how people live—or rather are dying— in the real world

This entry was posted in Austerity & Bank Bailouts, Economy and tagged , , , , , , . Bookmark the permalink.

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