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Friday, September 14, 2012

Latest cutbacks in Portugal bring explosive mood





New Portuguese austerity measures announced in recent days may be the tipping point that transforms the nation's sullen acceptance of belt-tightening into an explosion of anger like that seen in Greece over the past two years.

The five days that radically soured the Portuguese mood began last week when Prime Minister Pedro Passos Coelho announced an increase in workers' social security contributions to 18 percent of their monthly salary from 11 percent.

Workers and business leaders, opposition parties and government stalwarts — all have joined in sending Passos Coelho the message that Portugal can no longer stand the pain.

In addition to Saturday's mass protests, the Portuguese are due to voice their anger in a series of strikes and other demonstrations over the next few weeks.

The suddenly hostile climate could push Portugal along a path similar to Greece, where public defiance has frustrated efforts to lay out a clear path to recovery, damaging Europe's efforts to contain the financial crisis.

Portugal has won praise from the other 16 countries using the shared euro currency for complying with the terms of the €78 billion bailout agreement it signed in May last year after a decade of paltry growth and mounting debts.

A third recession in four years has denied the government anticipated tax revenue, and record unemployment of 15.7 percent has drained Treasury funds.

Antonio Jose Seguro, the leader of the main opposition Socialist Party which endorsed earlier cuts, said the government had gone too far this time and vowed to vote against the 2013 state budget.

Powerful members of the Social Democratic Party, the coalition's senior member, expressed dismay at the prime minister's strategy.

The demonstrations, organized via a Facebook page by a group of local intellectuals, were called to contest the cutbacks and were to take place under the slogan, "We want our lives back!"


READ THE ORIGINAL POST AT www.sfgate.com