Austerity rules in Europe, but the people push back

Protesters demonstrate in the French eastern city of Lyon, on Feb. 29, 2012, during a rally as part of the European Day against austerity plans. Banner reads: 'Enough is enough.'

Kai Ryssdal: In Europe, meanwhile, most major stock indexes recovered slightly after yesterday's sharp sell-off. The reasons for that sell-off, however, remain. Concern that, once again, Europe is losing its grip on its debt crisis.

Political events over the past couple of days -- in France and the Netherlands in particular -- are the proximate cause. And the worry goes something like this: That voters are pushing back against the key part of European deficit reduction plans -- austerity.

From the European Desk in London, Marketplace's Stephen Beard reports.

Stephen Beard: The irony is almost perfect. The Dutch government has collapsed after failing to impose a new raft of austerity measures.

And yet, says analyst Simon Tilford, no other country apart from Germany has been more critical of Greece's fiscal indiscipline.

Simon Tilford: The Dutch for the last year have been one of the leading cheerleaders for ever greater cuts in public spending in the south of the eurozone -- and they now face themselves unable to meet their targets.

Eurozone deficit-cutting suffered another setback. French president Nicolas Sarkozy lost the first round of the presidential elections to Socialist Francois Hollande -- an anti-austerity candidate. If Sarkozy loses the second round in two weeks' time, it will be a blow against the policy of belt-tightening championed by Germany.

And, says currency strategist Steve Barrow, it will damage the key European partnership.

Steve Barrow: That relationship between France and Germany which has generally been close, that relationship could get very frosty.

Relations between Germany and many of the people across Europe are already frosty. So says Nigel Farage head of the U.K. Independence Party, which campaigns against British membership of the European Union.

Nigel Farage: People do not want to live under German-dominated austerity and we're seeing a democratic rebellion.

Germany says austerity is essential to reduce the eurozone's debtload. But the backlash is growing. In two weeks, the Greeks go to the polls. Emboldened by the Dutch and the French, the Greeks seem likely to vote for an anti-austerity government.

In London, I'm Stephen Beard for Marketplace.

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One thing that surprises me is that despite "austerity" being a prominent term in all discussions of Europe's recent economic troubles, the term has yet to be used to describe anything within the U.S. political/economic sphere. Republicans push to change Medicare and other entitlement programs in order to alleviate long-term debt problems, but no one ever uses the "A word" to describe such efforts.

Why? What's the difference?

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