Germany Fears Social Unrest

Austerity policies have caused social unrest in Europe. When we last talked about this, we noted that there is a two-pronged problem that leads to social unrest. First, governments make promises they can't keep. Then people get used to the perks promised and all the talk in the world can't convince them that the perks just aren't affordable; human beings just don't want to give up a perk. Of course, some of the austerity measures go beyond taking away perks. As a result, people do truly suffer. And with enough suffering, you get social unrest.

So now, even the German government is getting nervous. German officials have consistently pushed and held the line on austerity, but it seems that's changing.

(Reuters) - German Finance Minister Wolfgang Schaeuble warned on Tuesday that failure to win the battle against youth unemployment could tear Europe apart, while abandoning the continent's welfare model in favour of tougher U.S. standards would cause "revolution".

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