Wednesday, 30 October 2013

The Costs of Austerity


Simon Wren-Lewis examines the official costs of Austerity in Europe.
please note that Europe did not get any growth what so ever by imposing these policies when their economies were slowing. It made their economies WORSE!

Here is a table he uses in his article


GDP losses due to Eurozone fiscal consolidation (including spillovers) 2011-13. Source European Economy Economic Papers 506, Table 5.



Impact on GDP 2013
Cumulative Impact 11-13
Germany
3.9%
8.1%
France
4.8%
9.1%
Spain
5.4%
9.7%
Ireland
4.5%
8.4%
Greece
8.1%
18.0%


Note where it starts. It isn't when the GFC occurred but well after .
Note too the cumulative impact on the economy.
Those fools who say Greece has not adopted austerity at all should apologize!

Okay any sane person knows you do not impose austerity policies when the economy is slowing. Almost all countries which did this in response to the GFC had a DEPRESSION which is not a recovery!

The time to do it is when the economy is humming along fine thank you very much. Bill Clinton did this, Paul Keating and Peter Costello did this in Australia.

Keynes 4  Austerians 0!