António Costa

Portugal’s left-leaning economic recovery

Portugal has been getting noticed for its remarkable recovery in the last two years, defying the doomsayers who predicted the devil was coming the moment that the Troika-prescribed policies were reversed and an expansionary policy was adopted instead.
The left-wing government that came to power in 2015, ridiculed by the media as a “contraption”, reversed many of the cuts imposed by the previous austerity government, which had tried to go “beyond the Troika” with disastrous consequences. Under Troika policies the deficit limit was always exceeded, public debt rose from 90% to 120% of GDP, and unemployment went through the roof.
Oddly enough, this left-wing alternative, by reducing austerity, and returning income to the middle-class, managed to make the economy grow, increase the tax revenue, reduce the burden of unemployment benefits, and achieve the lowest deficit in the 43-year old democracy. Public debt is also decreasing for the first time in many years.
Was this an unexpected outcome? Not so, say most economists who had always claimed countercyclical policies were the way to fight an economic depression, and had dismissed the notion of “expansionary austerity” as absurd. It seems Keynes was right, after all.
Meanwhile, though, the structural flaws of the Eurozone, that contributed heavily to Portugal’s financial crisis, persist. For concrete proposals on how DiEM25 would resolve them, see our European New Deal.
 

José Luis Malaquias is a DiEM25 member and a Physics engineer based in Portugal.

 

Do you want to be informed of DiEM25's actions? Sign up here

MERA25 Germany presents official candidates for 2024 European elections

MERA25 Germany presents official candidates for the 2024 European elections under the slogan "Live and Decide Independently"

Read more

The struggle goes on for African women

It is time to galvanise action globally to end violence against women and young girls

Read more

DiEM25 supports ‘Make Amazon Pay’ strikes and protests on Black Friday

DiEM25 stands proudly with the Make Amazon Pay coalition ahead on November 24, on the busiest shopping day of the year known as Black Friday

Read more

Netherlands: Another election in Europe, another victory for the far-right

Geert Wilders was the big winner in the Dutch general election as the far-right continues to grow at an alarming rate in Europe

Read more