Wage increases halved, and working houses in poverty more than doubled.
The growth of the GDP and living standards were significantly slower in countries with austerity-driven policies than those without following the financial crisis according to a new report by the Trades Union Congress (TUC).
Lessons from a decade of failed austerity reviewed how the UK and other countries impaired growth following the recession, and implored the government to learn from the mistakes as another potential recession looms alongside Brexit.
According to the report, wage growth has halved since the crash, and UK workers were most affected with annual real pay growth averaging less than 1 percent.
The number of working households living in poverty in Britain also increased from 5 million to 8 million, the report stated.
So what needs to happen?
TUC insisted that to get back on track the UK but conduct a review of how the Office for Budget Responsibility and Bank of England judge the impact of government spending on the economy.
They also called for a Fast-track increase to UK public infrastructure spending, which should be financed by borrowing rather than increased taxation in order to strengthen the economy.
TUC General Secretary Frances O’Grady said of the report:
“Austerity was always a political choice. It’s now clear how much harm it caused, holding down economic growth and living standards.
“We can’t afford to make the same mistake again. If there’s another crisis, the government’s response must be to focus on public investment to make our economy stronger.
“But we shouldn’t wait for the worst to happen. The best way to deal with a recession is to prevent it. There are already warning signs, so the government should act now by boosting public sector pay and spending on public services.”
Meka Beresford is a freelance journalist. Follow her on Twitter.
7 Responses to “Austerity policies slowed growth after recession, report says”
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Tom Sacold
Mmm… It seems that my views on the EU are as unusual as some would make out.
https://www.theguardian.com/commentisfree/2019/oct/24/eu-workers-rights-capital-multinationals
“The European project has always made life easier for capital. That’s why multinationals like it so much”
“… All week Labour MPs have been lining up to say that only by staying closely aligned with the EU can the socially progressive rights that Brussels has delivered be protected.
There is one problem with this idea: it is complete nonsense. Britain’s labour market has been reshaped over the past 40 years by deregulation, privatisation and anti-trade union laws, not by the limited protections delivered by the EU, which are weaker in practice than they sound in principle. There was, for example, nothing in the draconian Trade Union Act 2016 that would have run counter to EU law, not even the clause – eventually dropped as the legislation passed through parliament – that picket supervisors would have to give their name to the police.
This should not come as a surprise, because from its earliest days the overriding principle behind the European project has been to make life easier for capital, which is why multinational corporations like it so much. While the pro-employer bias has been there since the Treaty of Rome in 1957 it has become more pronounced in recent years as the slowdown in growth, entrenched high unemployment and the crisis in the eurozone have prompted calls for European labour markets to become more “flexible”.
… ”
And there’s plenty more. Read the article
Yep. The EU is indeed a captialist club.
Tom Sacold
Oops. Correction to the first line.
It seems that my views on the EU are NOT as unusual as some would make out.
Andrew Carey
But the UK didn’t have austerity. Real terms aggregate government spending per head in the years 2008-2018 was the highest of any 10 year period in history. The claim that government spending was insufficient does not compute.
So this analysis is plain wrong.
The real question is where the extra money went, and why did government spend it so badly and on whom?
Julia Gibb
@Tom Sacold
I think you were right in your first post.
Does the EU need reform YES!
Is Brexit the answer NO!
With Brexit you deliver a private playground for the rich which is much easier for them to control.
When you are on the same side as Farage, Boris, Trump, Hedge Fund Managers etc etc you need to consider that you may be wrong.
Extreme Wealth comes from having control and the model you support will never deliver change for the better because Brexit has proven that you can buy political control. It has proven that the wealthy have total control of the media.