Germany on Tuesday defended the policy of tightening the budgets in a number of European countries despite a blunt warning from a top European Union official that the 27-nation bloc's austerity drive "has reached its limits."
"If we were to give up the policy of consolidating the budgets in Europe, if we were to fall back to the old policy of taking on new debt, then we would cement mass unemployment in Europe for many years to come," German Foreign Minister Guido Westerwelle said Tuesday in Brussels.
His warning followed an admission from the head of the EU's executive arm, Commission President Jose Manuel Barroso, that the austerity prescription of higher taxes and lower spending, though correct in principle, may have hit the limits of public acceptance and effectiveness amid rising unemployment and recession.
"Even if the policy of correction of the deficit is basically correct, we can always discuss the fine-tuning, the rhythm or the pace, but that will not be sustainable politically and socially," Barroso said Monday, according to an official speech transcript. He added the deficit reduction "has to be complemented by a stronger emphasis on growth and growth measures in the shorter term."
Read more: Germany rejects EU hint at easing austerity drive | Breaking Tampa Bay, Florida and national news and weather from Tampa Bay Online and The Tampa Tribune | TBO.com
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