Portugal Approves Polemic Budget Amid Massive Public Protests
November 27, 2012
By LUIS MIRANDA | THE REAL AGENDA | NOVEMBER 27, 2012
If anyone wants to understand how much disregard governments have for their people, it will suffice to look at Portugal. The country is one of the European nations in worse condition, which caused massive public protests on the streets of the capital Lisbon as well as other cities. Despite the protests and the Portuguese government approved an ever more austere budget after 224 members of Congress discussed and voted for it.
Meanwhile, outside the Congressional building, thousands of people called by the unions and various civic associations, screamed and protested peacefully against the same budget in a desperate attempt to stop it, or at least to voice their anger. Eventually, enough votes from the coalition government conservative CDS-PP PSD decided to approve the text. All opposition (Socialist Party Portuguese, Portuguese Communist Party, the Left Bloc and the Greens) spoke against it.
The multitude of protestors included unionists, housewives, unemployed, students and others. One of these protesters carried a banner with a simple and powerful message: “Get me out of this film.” In one corner, a young man seemed to use a cardboard stand to solicit that people signed his petition against the upcoming move to privatize the water supply.
Everyone is convinced that the newly approved budget is going to make life worse yet some more. It’s true. The text includes, among other measures, a brutal tax increase described by the opposition as a genuine “tax bomb” aimed at wiping the government’s debt and to achieve the goals imposed by Portugal’s new owners, the Troika. The Government argues that a budget is conditional and that its scope to develop another one is very low given the need to adjust spending to meet its commitments.
The cuts are affecting many and especially the Portuguese salaried middle classes, which already carry the enormous weight of the economic downturn in a country that was ‘rescued’ in April 2011 to avoid bankruptcy.
So, starting next year, several sections are taken out from Portuguese Income Tax to raise more revenue in addition to a 3.5% general tax on everyone that will start in January. The hardest hit groups under this new tax scheme are retired people, those who receive unemployment benefits and others who get government subsidies for health benefits. In general, higher taxes, fees and surcharges will all increase for the Portuguese population and such increases will equal a complete full salary. Government workers and those who are retired will continue to live without their yearly bonuses paid to them once a year, but that was cancelled by the government a year ago.
Indeed, 2013 will be much tougher for the Portuguese people. The economy, according to the government, will fall by 1%, consumption will drop by 2.5% and unemployment will climb to 16.8%. There will be cuts, yet without specifying if they will reach Health and Education. Everything will work a little worse. It is expected that the country achieves a tiny sign of a recovery in 2014, if anything at all, said today the Finance Minister Vitor Gaspar.
The problem is that last year, Gaspar said the same thing referring to 2013, which has made it less likely that people and experts believe what Gaspar says.
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