European governments have increased their efforts to save people's livelihoods. According to the latest statistics from think tank Bruegel, the UK's money-spreading plan has reached 6.5% of GDP. Germany and the law doubled compared with two months ago. In the past year, aid cases in 27 European countries have reached 531.4 billion euros. The "Economist" believes that the world has entered a new era of "bailing out everyone".
Global inflation has started around the second half of last year, and has accelerated wildly after the conflict between Russia and Ukraine, causing many European governments to continuously increase private subsidies, including reducing consumption taxes, direct payment of money, freezing energy and grain prices, etc. European think tank Bruegel tracks and counts the amount of aid programs for families and businesses in 27 European countries since September last year, with a total of 531.4 billion euros.
After taking office, the new British Prime Minister Tras proposed to freeze the electricity and gas fees for all, with a maximum of 2,723 euros per household as a year, which is estimated to cause the government to spend 150 billion euros in the next year and a half. The big move immediately made the UK ranked first in Bruegel's statistics. In the past year (as of September 21), the government's relevant subsidy plan totaled 178.4 billion euros, equivalent to 6.5% of the UK's GDP, far ahead of other countries.
Germany was squeezed to second place. Compared with July this year, the German government issued a total of 43.2 billion euros policy checks, which has increased to 100.2 billion euros in two months, accounting for 2.8% of GDP. In addition to increasing subsidies for energy costs, the new plan for September also includes one-time payment of 300 euros to retirees and 200 euros to college students, and increasing rental subsidies, children's allowances, etc.
The French government’s increased subsidy proposal on the 14th has brought the cumulative expenditure of relevant policy to 71.6 billion euros, accounting for 2.9% of GDP, which is also doubled from July. The new measures include a maximum subsidy of 25 euros per month for households using natural gas heating, a maximum subsidy of 20 euros per month for households using electric heating, and a maximum subsidy of 200 euros per year for households using oil or diesel heating.
The Italian Career Cabinet has also continued to propose plans to save people's livelihoods, including issuing a subsidy of 150 euros per person for those with annual income of less than 20,000 euros, and subsidy tax burdens for small and medium-sized enterprises such as bars and catering. The relevant policies have reached 59.2 billion euros in the past year, accounting for 3.3% of GDP.
Newly added policies in other European countries include the Dutch government’s announcement to increase basic wages by 10%; the Danish government allows people to delay repayment within 5 years in the future for the part beyond last fall’s energy bill.
Regarding this phenomenon, the British Journal of Economist analyzed on the 27th that three major global events have followed in the past 15 years, causing governments to continue to subsidize people and enterprises, creating a new era of "relief for everyone".
These three major events are the financial tsunami from 2007 to 2009, the 2019 coronavirus pandemic and the recent soaring energy. Each incident has caused the government to spend a lot of money to rescue people and enterprises. The "economist" quoted the view of free market theory master Hayek , believing that each government bailout case may make sense, but when a large amount of government intervention accumulates, "it may kill an economy."
However, in the face of the continued shrinking purchasing power of people's wallets, especially the many public grievances and demonstrations on the streets of Europe, the government had to put financial discipline and market principles backwards and overcome the current difficulties first.
#Europe# #UK inflation rate hits a ten-year high#
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