Austerity in Europe, it's so fashionable right now!

As I mentioned recently the austerity would be coming with the bailout packages.  It didn't take even a week and the cutbacks have already started.

Today - Telegraph

Premier Jose Luis Zapatero told a stunned nation that public sector pay will be reduced by 5pc this year and frozen in 2011. "We must make an extraordinary effort," he said.

Pension rises will be shelved. The country’s €2,500 baby bonus will be cancelled. Aid to the regions will be slashed and infrastructure projects will be put on ice. Mr Zapatero’s own monthly pay will fall 15pc to €6,515.

more from the Telegraph today in another article

Jose Luis Rodriguez Zapatero, the prime minister, on Wednesday outlined a series of measures that will include a suspension in automatic increases to retirement pensions, a drop in overseas aid and a reduction in government investment.
He said 13,000 civil service jobs would be cut in 2010, with public sector wages frozen in 2011.

Spanish citizens will not be too happy about this and the austerity packages will tilt yet another country towards recession.