Final answer:
A country like Greece faces a crisis when not increasing its budget to cover debt as it can result in an inability to service debt, leading to investor distrust and borrowing challenges. Austerity measures to combat deficits can lead to further economic and social issues, affecting overall recovery and currency stability.
Step-by-step explanation:
When a country like Greece does not vote for a budget increase to cover increasing debt, a crisis can occur because the country may be unable to service its debts. This lack of confidence from investors can lead to difficulties in borrowing money through the sale of government bonds. Countries with high deficits due to bailouts and financial crisis, as was the case in Europe, may choose to undertake austerity measures, which involve significant cuts in government spending and tax increases to reduce the deficit. However, austerity can also lead to economic contraction, social unrest, and political instability, challenging the country's ability to recover financially and affecting the confidence in the currency, like the euro.