Economics and Politics in the Euro Zone

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It's not just Greece any more but larger countries facing an economic crisis. If they can't pay their debts, the big fear is collapse of a major financial institution. With Italy's national debt at 120% of gross domestic product, last week Prime Minister Silvio Berlusconi announced sweeping austerity measures. The reaction was a national strike on Tuesday that shut down public transportation and air travel. Today, Berlusconi re-vamped his plan and called for a confidence vote in the Parliament. Like the failure of Lehman Brothers in 2008, such a collapse could set off a global chain reaction and another recession with drastic consequences here in the US. Italians don't like austerity measures, Germans don't want to bail them out, and elected leaders in 17 countries are struggling to figure out what to do. US investors are cutting back on exposure to Europe, which could make things worse. We get updates from several countries.




Warren Olney