Europe is sinking ever deeper into a crisis of confidence that its leaders seem unable to stop, threatening the region’s political and social stability.
The debt troubles of the weaker links in the euro zone are snowballing, driving the costs of government borrowing even higher, forcing brutal cutbacks and undermining the common currency.
The planned European bailout for Ireland failed to soothe rattled markets Wednesday, and persistent defences of their solvency by Spanish and Portuguese politicians didn’t do the trick either.
Instead, worried investors fled in droves from troubled euro zone bonds, taking Spanish and Portuguese bond yields to their widest levels against comparable German bonds since before the adoption of the euro.
At the same time, Ireland’s embattled government unveiled a harsh austerity plan, angering its public, while Portugal was effectively shut down by a national strike similar to those that have played out in several countries.