By now, it’s been thoroughly proven by events that austerity policies backfire. Cut public spending in a deep downturn, and you only worsen the slump. Europe is the more extreme version of the proof, but even the United States, which is technically out of recession, faces a needlessly slow recovery. We’ve reduced deficits by slashing spending, raising taxes, and making sequester deals, but the supposed reward in the form of restored business confidence never arrives. Austerity, as Mark Blyth writes, neither restores growth not reduces the debt ratio, because slow growth (and in some cases negative growth) makes the debt loom that much larger.
|By: Robert Kuttner Sunday August 18, 2013 1:59 pm|
|By: Yves Smith Saturday April 30, 2011 1:59 pm|
Treasure Islands tells us that tax havens are much larger and much more destructive than most might realize, yet at the same time enjoy much more unofficial and formal support from governments in advanced economies than many of us want to believe.