John Cassidy at the New Yorker wrote an article that had me at “Austerity economic doesn’t work.” It’s more than a little frustrating to watch and listen to Republicans insist on austerity measures which, as we’ve witnessed and is painfully evident overseas, do. Not. Work.
Nor would they work here in the U.S. no matter how many times the GOP repeat their Cut Cut Cut mantra… and you know how reliable their judgment has been, up to and including the 2012 elections and beyond.
With Republicans in Congress still intent on pursuing a strategy similar to the failed one adopted by the Brits, this is a story that needs trumpeting. Austerity policies are self-defeating: they cripple growth and reduce tax revenues. The only way to bring down the U.S. government’s deficit in a sustainable manner, and put the nation’s finances on a firmer footing, is to keep the economy growing. Spending cuts and tax increases can also play a role, but they need to be introduced gradually. [...]
That austerity has led to recession is undeniable. … consumer and investment spending have remained depressed. [...]
In adopting a fiscal stimulus of gradually declining magnitude over the past four years, the Obama Administration has administered what was, until recently, the standard medicine for a sick economy. As one would have expected on the basis of the textbooks, the American economy, while hardly racing ahead, has fared considerably better than its British counterpart. [...]
Having adopted the policies of Keynes in response to a calamitous recession, the United States has grown more than twice as fast during the past three years as Britain, which adopted the economics of Hoover (and Paul Ryan).
More of Cassidy’s article at the link.