Debate Leads to Fall in Portugal"s Premier

The Austerity Debate causes Portugal to become the third country to be forced to accept public funds.

Another European government fell victim to the politics of austerity on Wednesday when the prime minister of Portugal resigned after opposition parties rejected his last-ditch attempt to push through a package of spending cuts and tax increases. The failure of Prime Minister José Sócrates to complete a fourth round of painful financial measures within a year led to the government’s collapse and pushed the nation closer to a bailout from Europe and the International Monetary Fund. Because its financing in the bond markets has become so costly, Portugal is expected to become the third country in the euro zone to be forced to accept public funds, following Greece and Ireland. It is a blunt reminder that last year’s debt crisis has not gone away. Ireland’s government also collapsed after its tough austerity measures failed to persuade investors to provide it financing at affordable rates.