I wrote a detailed blog post yesterday, showing that European governments have been very reluctant to restrain the burden of government spending.
Part of the problem is that the debate in Europe is a no-win exercise, pitting proponents of higher taxes (which is largely how Europe’s political elite defines “austerity”) against proponents of higher spending (notwithstanding a long track record of failure, the Keynesians have come out of woodwork and are claiming that bigger government stimulates “growth”).
With these terrible choices, no wonder the continent has such a bleak future.
Here’s a recent appearance on Fox Business News, where I discuss these topics.
I explain that Europe can grow and prosper, but only if politicians are willing to reduce the burden of government spending and lower tax rates.
But don’t hold your breath waiting for that to happen.
P.S. Americans shouldn’t get cocky. Our long-term fiscal outlook is equally grim. We can avoid a crisis if entitlement programs are reformed, but that obviously isn’t going to happen anytime soon.
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[…] tell them it’s mostly been a mirage. It turns out that “austerity” in Europe is simply another way of saying massive tax increases. National governments have […]
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[…] you can understand how this debate between higher taxes and higher spending is like nails on a chalkboard for someone who wants smaller […]
[…] you can understand how this debate between higher taxes and higher spending is like nails on a chalkboard for someone who wants smaller […]
[…] you can understand how this debate between higher taxes and higher spending is like nails on a chalkboard for someone who wants smaller […]
[…] you can understand how this debate between higher taxes and higher spending is like nails on a chalkboard for someone who wants smaller […]
[…] Debunking the Austerity Charade in Europe […]
[…] Debunking the Austerity Charade in Europe […]
Hi Dan, in “spreading the word”, I recently sent my definition of austerity to a leftie / Keynesian colleague:
“‘Austerity’ is the term used by those who would extract even more from our hard-earned income, to theoretically re-distribute to less fortunate parts of the community; then corruptly re-distributing to their crony-capitalist election funders, some to the less financially fortunate (which rather than helping, exacerbates their problems, creating generations of welfare/govt dependents …the ideal constituents for statists / socialists), and a big bulk of it to their bureaucracy power-bases / mates.”
Don’t know why I bothered …like many on both sides of politics, he doesn’t view the world (scary that he’s studying for his BComm, finance major) through economic eyes; but through political eyes & can see no wrong in his “side’s” actions / viewpoints.
Like you, I’m becoming more resigned by the day to economic stagnation or worse being inevitable.
Regards
KeithB
Perth Western Australia
Reblogged this on News You May Have Missed and commented:
Debunking the Austerity Charade in Europe