Credit guarantees encourage states to be careless

The EU's credit guarantees for states in financial trouble will encourage governments to act less responsibly, the liberal-conservative news magazine Wprost writes: "Bankruptcy is a mechanism that leads to recovery. Those who participate in the market are subject to this mechanism - independently of whether they are a state or a washing powder producer. It's about them making rational decisions and bearing the consequences of their actions. However if we avert a bankruptcy with guarantees by distributing money so they can bring their debt under control no one will bother about the consequences of high-risk actions. Pay rises for government employees? Why not? Raise the minimum wage? Go ahead. But who will foot the bill? No need to worry. Someone out there will do it."

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