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firefall · 61-69, M
Depends on your value of 'work'. Austerity is excellent for preserving the value of existing investments, and reinforcing the power of the ownership class, and generating more and more unemployed to force the wage rates down.
So from the point of view of the ownership class, it works wonderfully. It fucks everyone else, though.
So from the point of view of the ownership class, it works wonderfully. It fucks everyone else, though.
Burnley123 · 41-45, M
Leaving aside the (substantial) human cost, it is a failure on even its own terms.
If you cut during a downturn then businesses don't invest, people are listed off and/or are worried enough not to spend and the negative cycle continues. It's what Keynes called the paradox of thrift.
It might seem counter intuitive but Government needs to spend more in a downturn in order to stabilise the economy. If business and Government cut at the same time then it deepens the depession cycle. Government needs to act in a counter cyclical way and maintain full employment.
The classic example of Keynesianism in action was the New Deal. Contrast that with the recent deals imposed on Greece by Eurozone, where austerity (apparently the fiscally prudent option) contracted their economy by a quarter and made debt repayment impossible.
If you cut during a downturn then businesses don't invest, people are listed off and/or are worried enough not to spend and the negative cycle continues. It's what Keynes called the paradox of thrift.
It might seem counter intuitive but Government needs to spend more in a downturn in order to stabilise the economy. If business and Government cut at the same time then it deepens the depession cycle. Government needs to act in a counter cyclical way and maintain full employment.
The classic example of Keynesianism in action was the New Deal. Contrast that with the recent deals imposed on Greece by Eurozone, where austerity (apparently the fiscally prudent option) contracted their economy by a quarter and made debt repayment impossible.
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Burnley123 · 41-45, M
@firefall: The Cameron justified it by saying; "We spent too much and now we have to pay it back."
This annoyed me on so may levels and not least because it worked. Its immoral, class politics and also economically illiterate. They were aware of at least the last part too but Brits can be a gullible bunch.
This annoyed me on so may levels and not least because it worked. Its immoral, class politics and also economically illiterate. They were aware of at least the last part too but Brits can be a gullible bunch.
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