AUGUSTO SANTOS SILVA, the foreign minister of Portugal’s three-month-old Socialist government, is a mild-mannered sociologist, not a firebrand. But this month he found himself swept up in the defiant anti-austerity mood that has been spreading across southern Europe. Portugal had just been chastised by the European Commission for submitting a budget that missed the 3% of GDP deficit limit the euro zone imposes on its members (the commission projected it would hit 3.4%).
In an interview on Portuguese television, Mr Santos Silva struck back against northern Europe’s austerity preachers: “There are no professor-states or student-states in the EU.” In turn Angela Merkel, Germany’s chancellor, warned Portugal to maintain “solid finances”.
Portugal and the commission quickly compromised on a new budget with an extra €1 billion in tax increases and spending cuts. But the tussle showed that Europe’s war over austerity economics is back. Portugal’s prime minister, António Costa, was elected on a pledge to “turn the page on austerity”, and his government is backed by big-spending far-left parties. Meanwhile Italy’s prime minister, Matteo Renzi…