It is no secret that the Spanish economy is in serious trouble. Just recently it was announced that it had taken a second dip into recession. Philipp Bagus, Professor of Economics at Universidad Ray Juan Carlos in Spain was recently interviewed on the RT network about the unpleasantness in Spain.
In this brief interview, Bagus provides insight on the real and negative consequences of decades of government intervention in the Spanish economy and the future of the Euro.
He also provides important clarification on the austerity question. Many Keynesians, such as Paul Krugman, have been claiming that Europe has tried fiscal austerity, the economies are in trouble, ergo Keynes was right QED. Bagus explains the important difference between true and phony austerity. True austerity requires a reduction of state presence in the economy, not higher taxes.