That's … Search results can be reordered by: Find out more about BBC Programme Explorer. Read about our approach to external linking. Credit: Zak Kaczmarek/Getty Images), A spotlight on how North Korea developed its nuclear weapons and its plans for them, Of 100 episodes made over 2 years, these are our favourite 12 programmes. Latvia which was not in the eurozone in 2008 had very similar problems and has won praise for turning its economy around. The Inquiry gets beyond the headlines to explore the trends, forces and ideas shaping the world. Why Countries Agree to Austerity Measures . Ireland's banks, which had lent billions to builders, property developers and home owners then collapsed and the government bailed them out, took on their debts and almost went bust itself as a result. Read about our approach to external linking. Once a search is returned, add or exclude further terms from the results page and search again. Austerity is not a policy designed to punish moral failings, nor an expression of outrage over high levels of taxation and public spending. This is a prototype that has been developed as part of the BBC's response to Covid-19. Listen now BBC World Service. Has Austerity Worked? Youth unemployment passed 50% in Spain in 2012, Queues formed when capital controls were introduced in Cyprus in 2013, Iceland's tourist industry has boosted its economy, Far-right Golden Dawn protesters in Greece, https://www.bbc.co.uk/news/business-33470220, Full article Fighting for truth and justice in Syria. It introduced a series of stiff reforms and austerity measures, unemployment soared and is still over 20% making it the second highest level in the eurozone, after Greece, but the economy is now growing strongly and Spain has left the bailout scheme. The global financial crisis reignited an old debate - is it better to cut spending and raise taxes in an economic downturn, or spend your way out of it? It was bailed out as well but has since left the scheme, although it still has huge debts which will take many years to repay. As a result it was badly hit by the recession, as were its banks. The economy that traditionally depended on fishing and tourism was devastated when all three of its major banks went bust. After the global economic crash, governments faced a choice - to spend their way out of trouble, or to cut spending and raise taxes. Portugal had similar problems to Spain and Ireland but they were heightened by the fact that for decades it had failed to reform a bloated civil service and had also misspent much of the money it received from the EU over the years to develop its economy. In the other countries that have had to be bailed out it was far more a matter of an economic recession and a collapsing banking sector which had to be rescued by the state. After a period of relative consensus up to 2010, some countries inclined more to austerity (cuts and tax rises), some against. In this edition of The Inquiry we examine whether we now have the evidence to settle this important economic argument. It had to be rescued by the Troika (the IMF, ECB and EU) but it has slashed spending, increased taxes, reformed the economy and is now well on the road to recovery. It let one of its banks go to the wall, cut civil service pay and reformed the economy in return for a bailout from the Troika. The Inquiry After the global economic crash, governments faced a choice - to spend their way out of trouble, or to cut spending and raise taxes. Ireland left the bailout scheme in 2013, although it is now holding a public enquiry into why it bailed out the banks in a way that almost brought the country to its knees. Alternatively, search using only Search Filter options with an empty search box. While Greece is in the news now because it desperately needs another bailout it is not the only country in the eurozone that has had to be rescued. In Ireland a huge property bubble and a booming economy led the government to believe that it was responsible for an economic miracle. This is not necessarily good news for Greece, because it is not just the Germans who are opposed to writing off Greek debt or bailing it out once again. Both nations can now serve as models of the respective sets of economic policies. Is the evidence now in about what works? Certainly Latvia which not only reformed its economy but also joined the eurozone in 2014 is one of the harshest critics of Greece's performance and highly sceptical about why it should help pay to bail out Athens again. Ireland, Portugal, Spain and Cyprus have all been in the same boat. It did austerity, and that worked, too. The US president vows to hit the campaign trail, though he is still receiving medical care. A completely empty search will find all programmes. Spain had very similar problems; a huge property bubble that burst and threw the economy into a prolonged downturn, that was far more important than Ireland's crisis because Spain is the fourth-largest economy in the eurozone. The economy has, however, returned to growth, not least because the collapse of its banking sector led to high class graduates seeking jobs in other more productive industries. In Cyprus the economy was hit by the exposure of Cypriot banks to the Greek crisis and the spiralling cost of government borrowing. Iceland accepted an IMF bailout and help from several other countries, capital controls were introduced in 2008 limiting how much money could be taken abroad and they are only now being removed. The governments in turn needed to be bailed out because they ran out of money or could not borrow it in the financial markets at a reasonable price but they have, as a result, reformed their economies. However Greece was the first and its problems have been the longest lasting. The Greek government gave misleading financial information to get into the euro in the first place and then manipulated the figures to mask the extent of its deficit right up to the time when the credit crunch exposed its deep-rooted problems. Optionally, combine your query with a variety of filters to narrow your results. Despite having relatively low borrowing levels before the crash, rescuing the banks increased government debt, just as the recession slashed tax revenues and ruined the country's credit rating, so Spain had to be bailed out,. The global financial crisis reignited an old debate - is it better to cut spending and raise taxes in an economic downturn, or spend your way out of it? 23 minutes Available for over a year First broadcast: Tuesday 30th Jun 2015, 03:05 Latest broadcast: Sunday 5th Jul 2015, 14:05. Jonty Bloom looks at how austerity measures have worked out for other cash-strapped countries. Do a simple text search or combine your query with a variety of search filters to narrow your results. Relative to the size of its economy it was the largest banking collapse in history. Iceland, a member of the European Economic Area but not the EU or the eurozone, suffered perhaps the most spectacular crash having massively expanded into banking. (Photo: Anti-austerity demonstration. When you've chosen your filters, hit enter or use the 'Apply Filters' button. These are external links and will open in a new window. As a result when the credit crunch struck, the Irish property market rapidly collapsed, as did much of the tax revenue that it was bringing in. In this edition of The Inquiry we examine whether we now have the evidence to settle this important economic argument. Credit: Zak Kaczmarek/Getty Images). To find something specific, add your search term and hit enter. An examination of whether it is better to cut or spend your way out of an economic crisis. Austerity is a set of political-economic policies that aim to reduce government budget deficits through spending cuts, tax increases, or a combination of both. Has Austerity Worked? The OECD includes both -- … After the global economic crash, governments faced a choice - to spend their way out of trouble, or to cut spending and raise taxes. Greece is also accused of having squandered the years since its bailout: it has failed to reform its bloated pensions system and failed to push through privatisations or reform the notoriously inefficient and complicated tax system. Would Greece Be Better Off Out of the Euro? That's when creditors become concerned that the country will default on its debt. It occurs when the debt-to-gross domestic product ratio is greater than 77%. Countries use austerity measures to avoid a sovereign debt crisis. (Photo: Anti-austerity demonstration. Find out more... To find all currently available programmes, do a completely empty search. After a period of relative consensus up to 2010, some countries inclined more to austerity (cuts and tax rises), some against. Ireland, Spain, Portugal and even Cyprus which is traditionally very close to Athens might all feel, with considerable justification, that they are being asked to give more of their money to a country that has failed to introduce the reforms they did. It introduced huge tax rises and spending cuts and after a very sharp turn down returned to strong economic growth. An examination of whether it is better to cut or spend your way out of an economic crisis . While there are plenty of countries both inside and outside the eurozone that have been in similar problems to Greece, the fact is that many of them used a period of tough austerity to force through painful reforms. It was even dubbed the Celtic Tiger, but it turned out to be little more than a massive property bubble. You can also search by using just the filters and an empty search box. Austerity measures are often used by governments that find it difficult to borrow or meet their existing obligations to pay back loans. Austerity measures impact low income earners the most, as social safety nets are impacted by spending cuts. Read about our approach to external linking. Is the evidence now in about what works? It is also boosted by its tourism and fishing sectors. Greece is not the only country in the eurozone that has needed a bailout.
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