'Government budget deficits in Europe are still up to twice as large as they were before the GFC – when no one described them as austere – and are contributing to already vast public debt burdens. Far from the ‘savage cuts’ of Wayne Swan’s imagination, European governments have reduced only the rate of growth of public spending. Even in Greece, a country with little population or economic growth in recent years, spending is still greater than it was five years ago.'
Underlying Primary Budget Balance, OECD Economic Outlook 2013
Note how all the 'problem' countries have adopted contractionary policies Kates advocates not the expansionary policies a Keynesian would have.
Europe has/is experiencing a recession. Even though structural deficits have improved overall deficits have not as yet because of the recession Kates's recommendations brought on.
The public sector has detracted from growth in Europe. Contractionary fiscal policies has brought on an economic contraction. This was totally expected given that interest rates couldn't be lowered much more and the exchange rate was never going to depreciate enough to make up growth elsewhere.
A person expecting austerity to promote growth under these conditions is mad. A person who believes European countries underwent fiscal expansion is mad.
Steve Kates is such a man.
He is several sandwiches short of a picnic!