Little Christmas cheer for austerity-hit Europeans

By Barry Hatton

Associated Press

Published: Wednesday, Dec. 7 2011 3:55 a.m. MST

In this photo taken Monday, Dec. 5, 2011, people shop at a Christmas market featuring products manufactured in Portugal at Lisbon's Campo Pequeno bullring. The organizers of the event believe the promotion of Portuguese products can help the country out of it's debt crisis.

Armando Franca, Associated Press

LISBON, Portugal — The streets of downtown Lisbon are usually ablaze with Christmas lights around this time — but this year the city has put on a somber show that matches the somber mood of austerity.

The Yuletide gloom is seen across Europe's crisis-hit southern rim, as Athens and Madrid also dim the Christmas lights in a sign of how anxious countries have become about the future.

In Lisbon, the city council has cut its festivities budget to €150,000 ($200,000) from €850,000 ($1,150,000) last year, leaving main streets short on Christmas spirit.

The frugality has inspired ingenuity. Artists invited to help Lisbon look more festive have strung up multicolored umbrellas with flashing lights over busy Chile Square. Across town, passers-by are being given sparkling lapel pins to provide their own Christmas lighting.

"With more rudimentary and low budgets, we're bringing something different to make people smile," said Catarina Pestana, who designed the umbrella lights.

In Portugal, officials aren't just playing Scrooge with the Christmas decorations: The government is pocketing half of most workers' annual Christmas bonus — roughly equivalent to a month's pay — in a special one-off tax to help settle the country's crippling debts.

In Athens, which has suffered fatal riots against government austerity measures, authorities are mending their ways after the lavish spending of past years.

Municipal authorities say their outlay on Christmas and New Year will be one-tenth of last year's, at €200,000 ($270,000). That's the same as what a previous administration spent on the city's main Christmas tree, which was torched during December 2008 riots.

In struggling Spain, where the jobless rate stands at 21.5 percent, Madrid City Council has also scaled back its seasonal spending, making do with some of last year's decorations along city avenues and using fewer lightbulbs. The total cost of €2.5 million ($3.35 million) is down 15 percent from last year.

Stores in Madrid are slashing their prices by up to half to entice shoppers. Higher-end shops are feeling the pinch.

"Only one person came into the store on Saturday — three weeks before Christmas!" said antique dealer Dolores Sanchez.

There's further evidence of changing habits and expectations in Ireland, another bailout recipient. The Celtic Tiger era of lavish office Christmas parties and generous gifts for clients is out of fashion.

"Companies are embarrassed to be seen spending on parties when they're laying people off of their jobs, and that's only going to get worse in 2012," said the Rev. Sean Healy, a Catholic priest who runs an anti-poverty lobbying group called Social Justice Ireland.

That is only half the story, though. An expected pre-Christmas hike in the sales tax to a record 23 percent drove shoppers to Dublin stores before it came into force.

"Everything's only going to get more dear (expensive) in a few days, so I'm tapping out the credit card now and taking the rest of Christmas off," said Bridget Dwyer, 52, standing in a long line to pay for goods at a Dublin to store.

Overall, Christmas consumer spending in Ireland is forecast to fall by 9.4 percent this year compared with a 7.8 percent drop in Portugal, according to a recent survey by consulting firm Deloitte. But even those numbers look modest next to Greece's predicted slump of almost 25 percent.

Other EU countries offer a sobering contrast in fortunes.

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