Cyprus fades from the memory, and Portugal comes to the forefront …
Portugal has one of those austerity plans imposed on it by the EU a while back. That plan included cuts in wages and benefits (because unaffordable wages and benefits are the common thread between the recent bankruptcy decision for Stockton, California, the inability of the state of Illinois to pay its bills on time, and the problems in the PIIGS).
Except, the same problem as Cyprus cropped up in Portugal: the local courts said the compensation and benefits cuts in the austerity package are illegal.
So, the next rinky-dink plan is:
A person close to the government said it had mulled the idea of paying public employees and pensioners one month of their income in treasury bills, forcing them, in effect, to lend the treasury the money the court said it couldn't cut from their paychecks.
In the old days this was known as paying in scrip. It was part of what led to the huge union showdowns of a century ago: paying the workers in paper “money” that could only be spent at the company store.