Welcome to DU!
The truly grassroots left-of-center political community where regular people, not algorithms, drive the discussions and set the standards.
Join the community:
Create a free account
Support DU (and get rid of ads!):
Become a Star Member
Latest Breaking News
General Discussion
The DU Lounge
All Forums
Issue Forums
Culture Forums
Alliance Forums
Region Forums
Support Forums
Help & Search
Austerity Works!
If by "works" one means, does exactly what uncontroversial economic theory predicts it will do.
On the other hand, if one means "works" as in making economies in a demand crisis stronger... not so much.
September 3, 2012
Britain’s Paul Ryan
By Paul Krugman
In a lot of ways George Osborne, the Chancellor of the Exchequer (finance minister) is Britain’s answer to Paul Ryan. True, he’s a toned-down version — no Ayn Rand, please, we’re British — but other aspects of package are there in full force: he’s articulate, has a vision that’s completely at odds with everything we actually know about macroeconomics, and he was for a while the darling not just of the right but of self-proclaimed centrists on both sides of the Atlantic.
Osborne’s big idea was that Britain should turn to fiscal austerity now now now, even though the economy remained deeply depressed; it would all work out, he insisted, because the confidence fairy would come to the rescue. Never mind those whining Keynesians who said that premature austerity would send Britain into a double-dip recession.
Strange to say, Britain’s recovery stalled soon after Cameron/Osborne began their new policies, and the country is now in a double-dip recession.
So is Cameron rethinking his faith in Osborne? According to the FT, no: But Mr Osborne continues to enjoy David Cameron’s backing and will stay as chancellor when the prime minister this week conducts his reshuffle, expected to take place on Tuesday...
http://krugman.blogs.nytimes.com/2012/09/03/britains-paul-ryan/
Britain’s Paul Ryan
By Paul Krugman
In a lot of ways George Osborne, the Chancellor of the Exchequer (finance minister) is Britain’s answer to Paul Ryan. True, he’s a toned-down version — no Ayn Rand, please, we’re British — but other aspects of package are there in full force: he’s articulate, has a vision that’s completely at odds with everything we actually know about macroeconomics, and he was for a while the darling not just of the right but of self-proclaimed centrists on both sides of the Atlantic.
Osborne’s big idea was that Britain should turn to fiscal austerity now now now, even though the economy remained deeply depressed; it would all work out, he insisted, because the confidence fairy would come to the rescue. Never mind those whining Keynesians who said that premature austerity would send Britain into a double-dip recession.
Strange to say, Britain’s recovery stalled soon after Cameron/Osborne began their new policies, and the country is now in a double-dip recession.
So is Cameron rethinking his faith in Osborne? According to the FT, no: But Mr Osborne continues to enjoy David Cameron’s backing and will stay as chancellor when the prime minister this week conducts his reshuffle, expected to take place on Tuesday...
http://krugman.blogs.nytimes.com/2012/09/03/britains-paul-ryan/
