It is happening all around the world including Canada, the only difference is in degree. Governments on all levels are spending more than they are bringing in and the inevitable financial collapses are beginning to occur.
Cowardly politicians and shallow electorates have repeatedly brought in policies and programs that are totally unsustainable and have done so through debt. Nowhere is this more acute right now than in Europe where they have reduced retirement ages, shortened work weeks and grossly increased social entitlements such as pensions and welfare to the point of complete fiscal unsustainability.
The productive have been taxed out of the nations and investment is avoiding the EU like the plague.
One by one we are watching these nations collapse as they pass reasonable debt thresholds.
The economic collapse of these nations is not all that shocking. Right or left, the concept is very simple and immutable: IF YOU SPEND MORE THAN YOU TAKE IN EVENTUALLY YOU WILL GO TOTALLY BROKE!
Despite what should be a stark and self-evident reality, entitlement has blinded the citizens of these countries. As the inevitable austerity budgets come down, union-led riots erupt as people flood into the streets to demand funds that simply no longer exist. We saw this last winter in Greece and now are seeing it in Spain as pictured below.
Hipsters Gone Wild! Spain edition!
People can scream, shout, riot, assault police, attack businesses and throw whatever tantrums they like, it will not change the hard reality that the cupboard is bare.
Do these rioters think that their government is hiding a big pile of resources from them? Do they think their local legislative building has a mountain of gold hidden within it? Whatever their delusion may be, rioting is futile and they would be better served seeking employment and pinching their pennies.
As I said earlier though, we are only better in degree. Our governments at the federal, provincial and municipal levels are all spending more than they are taking in and it has to end. Will we let it end in bankruptcy like our European neighbors or will we begin to cut spending responsibly now while it can still be on our terms? I fear the answer for that.
We need to cut spending people. This is not a matter of opinion, it is simple reality. Otherwise we will inevitably end up in Europe’s shoes. It will be even worse for us pride wise as we have no excuse in not seeing this coming.