The Dangers of Austerity

[defacto7]

Last edited Tue Nov 26, 2013, 05:23 PM - Edit history (1)

I heard a radio broadcast this morning that intrigued me. I'm not an economist by any means but this makes a lot of sense to me. I'd be glad to hear comments.

Mark Blyth had an interview on our Salt Lake City NPR station. He's written a book: Austerity, The History of a Dangerous Idea which sounds like a read to me. Here's the blurb from the NPR site:

In the wake of the Great Recession, large Western governments have tried to keep their economies afloat by imposing austerity measures. The hope is that by reducing wages and spending they could bail themselves out of budget deficits and jumpstart global economic growth. The political economist Mark Blyth says that plan hasn’t worked out. He says austerity has led to sluggish growth and increasing inequality, and not for the first time, either. Blyth joins us to explain why austerity, like a zombie, is a dangerous idea that just won’t die.

http://radiowest.kuer.org/post/dangers-austerity-0
There's a video at the site, "RadioWest"

One of the statements that got my attention stated (my paraphrasing).. what makes us feel like the US debt means anything? at all? that is has any effect in the long haul? We still owe a debt for the Civil War that is unpaid but it has become insignificant due to the expansion of the US economy since then. Our problem is not with our debt to China or anyone else, our problem is a stagnant economy. Turn the economy loose through government program stimulus and the debt becomes a non contender at home or abroad.

That was my extrapolation of the content I heard and It make a lot of sense.

Does anyone else have any experience with Mark Blyth? Are there any comments on this take of austerity or the debt with regard to this point of view?

edit to add: Mark Blythe is a Professor of Political Science and Director of the International Relations & Development at Brown University.

[DJ13]

1. The current spate of austerity measures are just a vain attempt to preserve low taxes for the 1%

They know they arent paying enough to fund the government, but they believe they can keep their low tax rates (personal, investments, and corporate) if the great unwashed did without government programs to provide food and shelter to the poor, and Social Security for the elderly and the disabled.

Pure selfish self interest is the root cause.

[defacto7]

2. I'm inclined to agree.

All explanations for austerity measures seem to be without any form or history and void of logic.