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Two women talk in downtown Lisbon April 8, 2013. Portugal's constitutional court on Friday rejected four out of nine contested austerity measures in this year's budget in a ruling that deals a blow to government finances but is unlikely to derail reforms two years after the country's bailout.
Two women talk in downtown Lisbon April 8, 2013. Portugal's constitutional court on Friday rejected four out of nine contested austerity measures in this year's budget in a ruling that deals a blow to government finances but is unlikely to derail reforms two years after the country's bailout.
(Rafael Marchante/Reuters)

CARL MORTISHED

Portugal offloads debt, but still can’t start economic engine

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Among the new ideas to cut government spending in Portugal is a proposal to give civil servants treasury bonds in lieu of a month’s pay. It’s a cheeky response to the Portuguese Constitutional Court which late last week ruled that cutting public service pay is unfair and out of order. So, one idea seems to be that Portugal should carry on borrowing its way out of the crisis, but with the clever twist that, instead of getting more in hock to capital markets, the Portuguese government will just borrow from its own staff.