May 7th, 2012
08:05 AM GMT
(CNN) – With the election of Francois Hollande as the president of France and a Greek poll dealing a major blow to the coalition government in Athens, voters in Europe are pushing back on austerity.
"I asked for a strong mandate, but people chose differently. I respect their message," Greece’s New Democracy party leader Antonis Samaras said late Sunday. "Today's result expresses people's disappointment towards the implemented dead-end economic policy that tested their limits and didn't include the necessary development policy."
Meanwhile, French voters gave victory to the nation’s first a left-wing president since Francois Mitterrand left office in 1995. "Austerity can no longer be something that is inevitable," President-elect Hollande said.
Both elections have shaken the markets, which yet again are faced with uncertainty about the fate of the eurozone. Will a new coalition government adhere to the agreements that kept the fragile Greek economy part of the eurozone, or will political forces place Greece’s membership among the euro nations once again in doubt? “This could be the start of another deeply uncertain period in Greece with consequences far beyond its borders,” observed CNN correspondent Matthew Chance in Athens.
As nations like Spain and the UK drift back into recession, some economists are wondering if the austerity medicine is killing the patient.
“It is what you get when you begin with a diagnostic failure and you end up with the wrong cure,” economist Yanis Varoufakis recently told CNN.
Varoufakis argues the perception that debt in Europe is at the heart of what ails the eurozone is misguided. “The problem of Europe is not debt. The problem of Europe is a badly designed monetary system,” he said. “(Debt) is one of the symptoms.”
One result of the austerity measures is a rise in people taking their own lives, like 77-year-old Dimitris Christoulas, who shot himself last month in Syntagma Square in Athens, site of recent clashes between anti-austerity protesters and the police. As Christiane Amanpour recently noted, this phenomenon is spiking in Greece, Ireland and Italy, coining a new phrase in European newspapers: suicide by economic crisis.
Since the start of the 2008 Financial Crisis, there has been a tug-of-war between economists who advocate stimulus to help economies grow, and proponents of austerity to create structural reforms without kicking the economic can down the line.
On Sunday, elections in Greece and France suggest that battle has yet to be won.
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