Portugal Government Collapses,Over Debt Issues

Remember Greece, whose financial collapse started the whole EU debt crisis? Ireland also accepted EU help last year. Now we go to Portugal, who may be the next member of the EU looking for a hand up from the fiscal hole they dug for themselves.
http://www.spiegel.de/international/europe/0,1518,752857,00.html

Portuguese Prime Minister Jose Socrates resigned on Wednesday evening shortly after an austerity package proposed by his minority government was rejected by the Portuguese parliament. President Anibal Cavaco Silva announced in Lisbon late on Wednesday that Socrates had stepped down, after the prime minister had formally submitted his resignation to the head of state. Socrates, who belongs to the center-left Socialist Party, said that the political crisis would have "extremely serious consequences."

All of Portugal's five opposition parties rejected the austerity package, which was the country's fourth in 11 months. The opposition claimed that the measures, which included spending cuts and tax increases, were excessive. Socrates had earlier staked his political career on getting the budget passed, saying that he would resign if it was rejected.

The crisis increases the chances that the debt-plagued country will have to ask the European Union for a bailout, following in the footsteps of Greece and Ireland, which accepted EU help last year. Investors are also likely to wonder if Spain will become the next candidate for a bailout as a result. Socrates' resignation came on the eve of a crucial EU summit to discuss the euro crisis.

This may or may not have an impact on the stock market, but the more nations that flirt with this particular demon, the worse off the world economy becomes.

Adding to the EU's fiscal problems, the credit ratings on 30 Spanish banks were downgraded yesterday.
http://www.cnbc.com/id/42243770

Ratings agency Moody's downgraded its debt ratings of 30 Spanish banks on Thursday by one or more notches, and said the outlook remained weak with no major improvement seen in the foreseeable future.

With all those countries in Europe experiencing problems with too much debt, it should be clear by now that we won't be immune from consequences just because we're the United States.

The question is, will Democrats in this country wake up in time and actually recognize the similar fiscal danger we are in? Some of them are waking up, but most are not.