Portugal's main stock market is off nearly 60% from its pre-crash high, 38% from the post-crash bounce back.
As a new year dawns, the same economic problems that have gripped Europe since the worst of the Great Recession in the United States look primed to continue unabated – those problems being too much debt, a lack of ways to pay it off, and – because most European countries share a single currency – the imposition of strict austerity policies. The economic death spiral was first done, voluntarily, by Ireland in 2008. Seeing a coming debt crisis and knowing that massive spending cuts would be needed to stave off a bailout, Ireland did just that. As a result, unemployment skyrocketed from 4.4% in July, 2007, to 12.3% just two years later. Continuing to rise, Irish unemployment has peaked and stalled around 14.5% in December of 2010 – still sitting at 14.3% as of the latest data (October 2011). Ireland’s reward for its foresight was an economic collapse anyhow, necessitating a bailout of €67.5bn in the waning days of November, 2010.
Portugal was worse off than Ireland – its economic collapse driven as much by debt concerns as it was systemic government corruption, resulting in the creation of many redundant public sector jobs, and vast mismanagement of payment the closer you got to the inner circles of Portuguese government. The country was on the verge of bankruptcy in 2011, and received a €78bn bailout in the middle of May. Portugal has also been coerced into taking on deep public spending cuts – beyond what was wasted by annual corruption – to the determent of everyday life in the country.
Average citizens are left baring the brunt of the hardship, with Portuguese unemployment barreling upwards from 8.2% in March of 2008 to a fresh crisis high of 12.9% in October of 2011. While Portugal’s journey from pre-recession unemployment to recession-unemployment heights hasn’t been as sharp as its European counterparts, its government certainly takes home the honors for least emphatic response to the concerns of the public. Facing mounting questions and complaints about Portugal’s floundering economy and dismal employment prospects – especially for the educated young – the Prime Minister suggested that if people don’t like it, they can just leave:
A wave of indignation was triggered when Passos Coelho, in the face of the growing unemployment that is hitting young people and educators extremely hard, suggested to teachers on December 18 that as an alternative they could move to Portuguese-speaking countries like Brazil or Angola.
The next day, several ministers applauded the prime minister’s remarks, saying his suggestion was a valid solution, especially for teachers.
But the governments of Angola and Brazil quickly responded, saying they had no immediate need for teachers.
Almost as entertaining as the Prime Minister’s gall for suggesting this to be a valid course of action for his citizens was the response to his suggested target countries that, in effect, “we don’t have any room here, either.” Some 120,000 left Portugal alone in the year 2011, but it has hardly been official government policy to suggest people do so. Controversy aside, it does shine some light on the frustrations that must be mounting with an increasingly systemic and intractable problem across the continent – there are no quick fixes, it’s going to hurt, and it’s going to hurt for many years to come. The debt-fueled boom-times of the 2000′s continue to fade to a distant memory as austerity-dominated 2010′s continue to soak its way into the European fabric.