Are Europe’s ‘Days of Austerity’ Numbered?

It began months ago, but now calls across Europe for less austerity and more growth are, well, growing. Growing really loud. The Greeks, who’ve been screaming this same thing for nearly two years, might take some dark solace in the following turns of events:

The head of Europe’s central Bank, Mario Draghi, is now openly calling for a “growth compact” to counterbalance the European Union’s new “fiscal compact” which requires countries to balance their budgets, and sets out concrete punishments and interventions for countries that don’t.

France’s next likely President, the socialist Francois Hollande, is campaigning, successfully, on the same message: austerity kills. He’s pledged to force a complete renegotiation of the fiscal compact, which could see the whole project, as it stands, collapse.

The Irish are signaling that they may not support the fiscal compact, which is being put to a public referendum there. The Irish have been bailed out once, but that extra money, plus strict budget cuts, have not revived growth.

The Dutch government has just collapsed after the ruling coalition could not agree to accept more Brussels-dictated public spending cuts.

Spain has flat out rejected Brussels’ deficit reduction goals for this year, setting its own, less austere number. But even so, spending cuts in Spain are ravaging its world class healthcare system and undermining public education.

And finally, this little reported but potentially alarming news out of Portugal — another country that has been both bailed out then squeezed by its paymasters into an ever deeper recession: Wednesday, the day the Portuguese celebrate the military uprising that ended the Salazar dictatorship in 1974, said military refused to participate. For the first time in 38 years.

Instead, soldiers staged their own protests. Against who? Against the architects of austerity and their own leaders who’ve swallowed what they see as the poisonous medicine.

No one has suggested that Portugal’s military might rise up to “save the nation” once again, but it’s opt-out on “democracy day” has to be troubling to leaders across the continent.

So now, lo and behold, even German Chancellor Angela Merkel is saying Europe needs more growth. Merkel, along with French President Nicolas Sarkozy, is the architect and main champion of 21st century austerity. I won’t go into the deep psychology behind what many see as her stubborn adherence to this doctrine.

What’s interesting today is that she may finally be caving in. To the economic reality that austerity appears to be killing patients rather than saving them, and to the political reality that European citizens appear to have taken just about all they can take.

But to grow, as the Pan-European Political Chorus now chants, requires spending public money. The fiscal compact requires slashing spending.

Something must give.