https://archive.ph/b088G https://archive.ph/b088G 'European governments are increasing spending to shield households from surging energy prices driven by Russi

https://archive.ph/b088G https://archive.ph/b088G 'European governments are increasing spending to shield households from surging energy prices driven by Russia’s economic war, but that comes amid rising borrowing costs and mounting investor unease about swelling sovereign debt in some countries. To date, the European Union’s five largest economies have announced support for households, and less costly help for businesses, totaling €203 billion, around $201 billion. The measures might keep millions of people from sliding into poverty—and thousands of businesses from going bust—as energy bills soar, cushioning the crisis’s impact on the economy and, governments hope, backstopping political support for Ukraine. Some measures, such as price caps for power and natural gas, could also help central banks to fight inflation. But they also come with risks: If they discourage recipients from cutting their gas consumption, that could lead to shortages of the fuel late this winter. And while the supporting measures aren’t yet on par with the Covid-19 bailouts of the past two years, they are adding to government debt at a time when investors are demanding higher interest to finance budget deficits already swollen by pandemic-era spending. Some of this aid comes in the shape of caps on energy prices, or cuts in energy taxes, which economists say could encourage higher natural-gas and power consumption, possibly leading to a shortfall of both early next year and rationing or blackouts. “That’s exactly the wrong kind of thing to do,” said Benjamin Moll, a professor of economics at the London School of Economics. While help should be provided to hard-pressed households, it should come in ways that “are not directly tied to gas consumption,” he added.'