The mother of all tooth aches

Our dear prime minister has admitted that public deficit next year will be 5.2% of GDP.  In itself a staggering value of ~8.5 billion Euros.  Roughly 10.5% of the state budget.

I have even been generous here using the official EU numbers for the expected retraction of the economy next year of 3.4%.  The real retraction will be larger.

Our goal for the deficit next year is 4.5%.  This year it is 5.9%.  According to the minister of finance we will reach only 4% this year by magic by the creative accounting of throwing the banker's pension fund into the black hole of public finance.

The  pension fund was 6 billion euros i.e. ~3.5% of the GDP.  How that adds up to 8%, I cannot understand.  8% is was what the prime minister also admitted the deficit would have been this year with out the theft gift - and 3.5% plus 4% is only 7.5%...

To put everything a bit more into perspective.

• The real deficit of this year compared to last year are not far from each other.  Last year was 9% and bit
• The real deficit with a large number of austerity measures has thus only been lowered about 1%
• The 6 billion euros bankers fund was around 7% of state "income" this year
• The next 10 years (I believe it is many more), the state will have to find 0.6 billion euros to pay the banker's pension.  As the fund is in the black hole...  
• BTW this is pointed to as one of the reasons the 2012 budget is already invalidated.
• We are not even in 2012 yet!
• If you looked at the pension fund as loan - as would be proper, then the interest rate is 10%.  And perhaps much more.

Of course added to that an untold number of debts will have to paid every year.  The Troika loan, the other state loans, the public companies continuing debt spiral and so on.  Just the interest rate that will have be paid every year is incredibly large.  The interests of the Troika loan alone will require 10% of the entire state budget.

Furthermore what about the problems of a systemic world wide crisis, an even worse crisis in the EU, a retracting Portuguese economy (and it may get real ugly), PPPs, a broke social security (the money for pensions has been spent) and zero measures to liberate the companies from the state - still no structural reforms?

Portugal is broke.  The country would be better off admitting it now (everybody but the politicians know it).  Portugal should seek help.  Get a hair cut like Greece (currently negotiations have reached 65%) and be happy it not called a default - a state bankruptcy - though I can personally see no difference.

Unless Europe gets it act together it would also be better for Portugal to leave the Euro entirely.  The Portuguese economy is simply not up to it.

It is like a tooth ache.  You can ignore and not go to the dentist but it will only get worse in the end.  The people has suffered sufficiently because of a small group of corrupt criminals.  It is a time for drastic measures.