A new age of austerity is threatening Europe

Associated Press//December 20, 2010

A new age of austerity is threatening Europe

By Associated Press

//December 20, 2010

A beggar asks for coins near an open air Christmas market in Milan, Italy.
A beggar asks for coins near an open air Christmas market in Milan, Italy.

Greeks dodge riots to do their Christmas shopping. Italians planning holiday feasts quietly stuff freezers. And the needy in Ireland are literally selling the family silver.

This Christmas, Europeans are hunkering down to an uncertain future, as a debt crisis that erupted last year in Greece flares anew in Ireland, and has quickly threatened to engulf Portugal, Spain, and Italy.

A whole way of life appears to be at stake as Europe’s cherished social welfare nets begin to unravel — and the very survival of the common currency is thrown into doubt.

The new age of austerity is forcing jittery Europeans to tighten belts they’ve grown accustomed to loosening during the festive holiday season. But there’s been as much Santa as Scrooge as families find ingenious ways to stay in the spirit of giving.

Here’s how struggling Europeans are coping.


Beyond pay cuts, price hikes and rising unemployment, Christmas shoppers in Athens face an additional challenge this year: Getting to the store.

Daily public transport strikes and demonstrations blocking streets have made it harder to hunt for downtown bargains. In extreme cases, shops even provide a haven from rioters.

At one violent rally against austerity measures this month, shoppers hurried into a department store on Athens’ main Syntagma Square to escape clashes and tear gas clouds, suddenly stepping into an eerie refuge of calm in which Bing Crosby’s “White Christmas” played in the background.

Strikes and protests are killing off hope of a late surge in sales, with some owners forced to sell off stock in pre-Christmas sales.

“If you have no money in your pocket, things are difficult,” said downtown gift-shop owner Michalis Papayiannidis, adding business is probably the worst since he opened the store selling toys, plates and fabrics from Africa and Asia 16 years ago.

Garbage strikes, leaving huge piles of trash on street corners, have only made things worse, he complained.


For Italians, holiday bounty unfolds at the table on Christmas Eve.

Family and friends sit around a festive dining room table groaning under the weight of several courses — from homemade broth with dumplings to fettuccine with costly truffle toppings to pricey fresh fish or lobster, all washed down with countless bottles of sparkling wine.

But for the cash conscious, there’s something fishy about this year’s preparations — especially if you open their freezers.

Fishmonger Loris Trotta said customers are buying fish in advance, then freezing it as protection against the surge in prices that inevitably strikes the week before Christmas.

In a culture where “bella figura” — making a good impression — is paramount in everyday life, the euro-pinching is a drastic departure from custom.

Trotta, shivering on an unusually cold day in a neighborhood Rome market near the Tiber, said standard Christmas choices like turbot, sea bass and scampi are being substituted for less expensive cod.

“It makes the same good impression because it’s a big fish,” Trotta assured customers.


Droves of Christmas shoppers are resorting to selling the family silver — or an ex-girlfriend’s earrings — to drum up the cash for stocking stuffers or a Christmas turkey.

The nation has been at the epicenter of the latest flare-up in Europe’s debt crisis. Unemployment has tripled to 13.5 percent and average incomes have slumped 15 percent since 2008.

Dublin has experienced a pre-Christmas explosion in makeshift jewelry shops that are buying at meltdown prices.

“I need to find a shop that buys silver. I don’t have any more gold on me,” said Jarlaith O’Connor, 26, an unemployed Dublin electrician standing outside a shop emblazoned with “WE BUY GOLD” in screaming red letters.

“I’ve no money for Christmas presents. If I can’t sell this, all the missus is getting is a card,” said O’Connor, holding a silver chain and Glasgow Celtic soccer pendant. He’d received it as a gift two years ago and figured he could get 30 Euros ($40) for it. He’s already sold jewelry containing gold — whose price has soared amid global economic turmoil — for 90 Euros ($120).

Peader Casey had just sold a gold chain he’d received as a 21st birthday present last summer from his sister. He got 39 Euros ($50) for it, barely a tenth of what he thought his sister had paid for it.

“It wasn’t the best price, but I need the money. It’s hard times, man,” said Casey, who works as a supermarket warehouse worker.

Casey grew up during the Celtic Tiger boom, when incomes rose strongly, jobs were for the taking, and teens didn’t think twice about “pouring money down the drain.”

“Now, if you see a copper coin on the pavement, you’ll go out of your way to pick it up,” he said. “I wouldn’t even be bothered if somebody saw me do it.”


Christmas cheer is scarce in Spain as the nation struggles with unemployment of nearly 20 percent and grim growth prospects.

Shoppers line up every day outside discount toy shops selling knockoffs at 10 Euros ($13) each. Many bring along their kids because they can’t afford baby sitters.

Mercedes Barreda, an unemployed secretary, came with her underemployed electrician husband and their 4-year-old daughter Dolores.

“Some of the toys here are half the price of similar ones we’ve seen,” Barreda said. “Dolores wants to open them already, but we’ll see if we can calm her down a bit so she forgets about them until Christmas.”

Marina Ortega and Remedios Falcon drove in from Madrid’s outskirts to line up outside the store selling everything from Crayola crayons to remote-controlled cars. Business is way down at the hair salon they run, and they had to find a way to cut back on Christmas spending.

“Between us we’ve got nine kids to buy for and with the crisis this place is like a godsend,” Ortega said. “We’ll be able to make Christmas look special despite not having much money.”


Portugal, one of Europe’s poorest nations even in good times, has been one of the hardest hit by the continent’s debt crisis. So Isabel Jonet, head of Portugal’s network of charity food banks, was stunned by the response last month to her organization’s Christmas aid appeal.

The campaign, in which supermarket shoppers were asked to fill bags of food for charity, was a spectacular success, with donations up 30 percent from the previous year.

“I was overwhelmed by people’s generosity,” Jonet said. “It was just tremendously moving.”

Portugal is one of the frailest members of the 16-nation euro zone, and analysts predict it will be next to ask for a bailout.

During the past decade of feeble economic growth, Portugal ran up huge public and private debts. Its budget deficit last year reached 9.6 percent — the fourth highest in the eurozone.

Unemployment has risen to 11 percent, and many long-term jobless no longer qualify for benefits. It can be hard to make ends meet even with a job. Several hundred thousand people earn the minimum monthly wage of 475 Euros ($625).


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