FT pulls apart austerity economics

Green Politics

The Financial Times has this morning produced a blinding set of graphs which highlight how fiscal austerity has negatively impacted on the GDP of various European economies.

The Financial Times (£) has this morning produced a blinding set of graphs which highlight how fiscal austerity has had a negative impacted on the GDP of various European economies.

Essentially, the greater each government’s austerity drive the larger the drop in GDP. Are you listening, Mr Osborne? The third graph (furthest to the right) is the important one (the horizontal line depicts the level of austerity from 2009-2012 and the vertical line shows the fall in GDP.

The coup de grace is delivered, however, by Paul Krugman of The New York Times:

“Austerity was costly for the afflicted economies: the greater the tightening between 2009 and 2012, according to the International Monetary Fund, the bigger the fall in output.”

Thus, FT journalist Martin Wolf adds, “the panic that justified the UK coalition government’s turn to a long-term programme of austerity was a mistake“.

“In the long run, the fiscal deficit must close. In the short run, the UK has the chance to push growth. It should take it. So should the US.”

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62 Responses to “FT pulls apart austerity economics”

  1. LB

    Far from it.

    The difference is that I post evidence as to what is going on. The left and the right, choose to ignore it to the detriment of the people of this country.

    You’ve assumed that because I have a go at the left here, that must make me right wing.

    What you don’t see is how much I have a go at the right, such as the Tories on other sites.

    I’ll put that down to a lack of education and the ability to think things through, instead of jumping to conclusions.

    So back to the two core issues.

    1. What are you going to do about the 5,300 bn government debt that has been hidden of the books? Pensions.

    2. What about the 40,000 slaughtered in the NHS each year – avoidable deaths.

  2. LB

    Look at the overall level of spending.

    If you are being cut, then there are lots of departments which must be booming.

    Hint, its not welfare.

    So come on, how are you going to pay the 150 bn deficit plus interest, multiplied by 4.

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