Tag Archives: austerity

On March 16th, George Osborne unveiled his shiny new Budget. Full of populist tax giveaways to help "hard working people", it was the sort of budget that we might expect from a Chancellor riding the crest of an economic recovery. UK plc is growing well, profits are rising and the Board can afford to increase the dividend.But this is not the current economic situation. Far from an economic recovery gathering pace, the latest figures from the OBR show that UK plc is slowing. In its March 2016...

By Sunanda Sen* (Guest Blogger)Success achieved by the Indian economy , as highlighted in the recent budget of the central government rests on four pillars which include current GDP growth rate at 7.6%, drop in inflation ( as measured by the CPI index) around 6%, a record stock of official reserve at $350bn and most importantly, a reduced fiscal deficit at 3.5% of current GDP.Looking beyond the official figures to convey the positive note, one comes across reservations; first that the GDP...

It’s a catastrophe, even though some people are crowing about the admittedly large real GDP growth rates in 2014 and 2015 (at 5.2% and about 6.9% respectively). In the media, we find breathless stories about Ireland being the “fastest growing economy in Europe” as if Ireland’s brutal austerity is a viable model for the rest of Europe.However, actual Irish real GDP still stands below its 2007/2008 peak, even after 8 years. The depth of Ireland’s collapse was on the scale of a depression (that...

This is how the mission of the President’s National Commission on Fiscal Responsibility and Reform was defined by the White House on February 18, 2010: The Commission is charged with identifying policies to improve the fiscal situation in the medium term and to achieve fiscal sustainability over the long run. Specifically, the Commission shall propose recommendations designed to balance the budget, excluding interest payments on the debt, by 2015. This result is projected to stabilize the...

We need big, big changes in the United States. Many of them will require the Federal Government to spend unprecedented amounts, including deficit spending to enable us to solve problems that have languished, creating needs, for many, many years. How can we get these changes legislated through a political system that has been increasingly less responsive to most people over the past four decades. There’s only one way that will work without revolution. We need a movement for change powerful...

Almost done for the year. So do not expect many posts before the end of the ASSA conference (January 5). But as I promised, here are some brief thoughts on the Brazilian crisis.Brazil is a mess. The economy is collapsing, with an estimated decline of about 3.5% in GDP this year (perhaps worse), and inflation has accelerated, to two digit levels, way above what used to be the upper limit of the inflation target band. Worse, politically the country is paralyzed, with an impeachment process in...

Below is an excerpt from my most recent e-book: Real Fiscal Responsibility, Vol. I: The Progressive Give-up Formula. The book is volume I of II critiquing austerity politics at the Federal level in the United States. It exposes its fallacies, its closed-mindedness and futility, and especially its reliance on wrong-headed conceptions of fiscal sustainability and fiscal responsibility. In this volume, I relate neoliberalism, the Washington Consensus, and austerity politics pushed by the...

The world turns on its dark side......it is winter A Child of Our Time, Michael Tippett "Man has measured the heavens with a telescope, driven the gods from their thrones," proclaims the contralto at the start of Michael Tippett's wartime oratorio A Child Of Our Time. Like our counterparts before the dark time of which Tippett writes, we too believe that science leaves no place for religion. But religion endures, and when the world turns, it comes back in its most violent form, tearing...

The Chancellor's Autumn Statement contained an apparent U-turn on the cuts to tax credits outlined in the July budget. Predictably, this was presented as the Chancellor "listening" to those concerned about the impact of sudden large falls in income for working families at the bottom end of the income spectrum. The Conservatives continue to position themselves as the party for "hard-working families".However, this isn't quite what it seems. The income cuts for low-income working families are...

While visiting Germany in the summer, I was struck by the prevalence of adverts saying something on the lines of "Sie sparen können". I've never seen a society so obsessed with saving, not in the sense of putting money away (though they do that too) but in the sense of reducing costs. Never mind the quality, look  at the price. "You can save". Always.Penny-pinching is by no means limited to German households. Ever since we collectively decided, on September 16th 2008, that the money had run...