European Debt Crisis

In order to help stabilize its balance sheet, Spain has set out to cut its spending.

This is being met with severe resistance. For example, who wants to get their pension cut. Its sounding like Greece with protests and strikes threatened and such.

The Spanish economy is not growing and there is no silver bullet.

Business Week: Zapatero Losing Credit as Fitch Strips Spain of AAA Rating

In return for the European financial backstop, and urged on by U.S. President Barack Obama, Zapatero announced on May 12 the first cut to public wages in Spain’s 30-year democracy and a freeze on pensions.


(Spain's) Government debt, at 53 percent of GDP last year, is lower than that of Germany, France and the euro-region average. Still, weak growth may increase the burden as a proportion of the economy.