Sunday, 13 September 2009

The Netherlands typifies a European fear that any big fiscal stimulus might just benefit others

Europe and america has a disagreement about the need to use fiscal stimulus to fix economic crisis and barrack obama called this debate as a “phoney debate”. Reasons for this debate are whether this stimulus wil be helpful; fiscal policy includes increase in government spending, while in european union it was said that there is an increase in demand from southern countries to get more communal fund and also there are many aims for which EU has to spend money.
 There are many other national problems in EU such as unemployment which government has to solve by increasing spending, however there is a scarcity of taxation revenueand labour party opposed public spending cuts. 
A surplus projected by Dutch government became a 5.5% deficit and one economist said that the government has to take some measures in order to solve this problem such as reduce wages in order to boost exports.

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