Tuesday, May 8, 2012

Who is writing the "austerity" script?

Another day, another moronic article on the dangers of "austerity" economics. Today, playing the role of clueless Krugman sycophant, we have Eugene Robinson with his latest article in the Washington Post. Sporting the clever title of "Austerity Bridge to Nowhere," Robinson repeats the now-close-to-mind-numbingly-boring refrain about fiscal responsibility being austerity and increased government spending being the only sure fire road to economic prosperity.

Don't expect any evidence for the latter claim. None is needed; it's "true" because it has now been repeated a sufficient number of times by people in the media, in academia, and in positions of authority. I think the number needed in that regard is around 5, 425, but I'm not sure.

Anyway, Robinson does give lip service to the existence of opposing views:
It should be noted that there are some economists who disagree. They argue that draconian cuts in government spending will somehow awaken the animal spirits of private-sector executives, entrepreneurs and financiers. They further argue that austerity is needed to combat the scourge of inflation, although the best term to describe inflation in today’s economy is “imaginary.”
Notice how any and all suggestions with regard to controlling runaway government spending are automatically termed "draconian cuts" by people like Robinson. The term "draconian," by the way, derives from Draco. No, not Draco Malfoy. Draco was an Athenian, living in the 7th century BCE, who was tasked with compiling the first written law code of Athens. By all accounts--the actual code is no longer extant--the punishments established by this code were harsh. Thus, "draconian" came to refer to overly harsh laws.

The term has since been appropriated to refer to anything one might deem harsh or severe; using "draconian" instead of harsh, however, invokes the sense of punishment. Thus, the reason for its now-common usage among the enlightened ones: spending cuts are equated with punishment. Who is being punished? Why the common folk, of course.

The impetus for Robinson's article are the results of the French election, which saw the defeat of Nicolas Sarkozy. According to Robinson and his ilk, this defeat was a referendum on "austerity":
On Sunday, French voters elected Socialist Party candidate Francois Hollande as president, ousting center-right incumbent Nicolas Sarkozy in what amounted to a referendum on Sarkozy’s embrace of austerity.
The problem is, there has been no "embrace of austerity," in France or anywhere else in Europe. As this chart from Veronica de Rugy shows, government spending in France--and Britain, as well--has been increasing. Other nations saw--at best--modest decreases. Where are the "draconian" cuts? Where?


Of Britain, Robinson says the following:
In Britain, the economy was growing when Prime Minister David Cameron took office two years ago. Adhering to the platform of his Conservative Party, Cameron took the austerity route with a host of gloom-and-doom budget cuts. Now unemployment is rising and the economy has slipped back into recession. Nice job, Tories. 
One can't help but wonder if Robinson did even an iota of research before he wrote this piece. Because it looks like he just regurgitated the Krugman-esque storyline of the past several years.

So, what's going on? Did Sarkozy lose in France because of "austerity" measures? Perhaps. But if so, it's because the phony narrative--repeated here by Robinson--succeeded in France, that any attempt to institute some kind of fiscal sanity in government policies is equal to "austerity."

Robinson's other language choices in the piece are equally telling. He talks about fiscal responsibility as a "dangerous, self-defeating intellectual fad." Proponents of such things he likens to members of a cult, also referring to them as "austerity fetishists." That's a lot of heavy-handed rhetoric. And it's being employed as a substitute for actual analysis, for actual evidence.

But I have to wonder if Robinson even knows that he's being used, that he's repeating nonsense. Because he actually seems sincere and actually a tad angry, if also somewhat pompous and obnoxious. Is Krugman the author of this script? Is Mark Zandi? Or maybe it's the Obama Administration. Or George Soros.

Or maybe...none of the above and all of the above, at the same time. Because it seems to me that the tale is one that keeps growing in the telling. And the fact that media types and political pundits keep repeating it--with no apparent attempt to verify anything, but rather simply wanting to "pile on"--tells me we have a serious problem: many of our leaders and most of the media are morons.

Cheers, all.

6 comments:

  1. I checked the data from the OECD. I confirm there is no real austerity.
    general-government-total-outlays
    general-government-financial-balances

    I do not know if you are aware, but several studies show evidence that government spending does not increase private employment during a recession.
    Government Spending Has Zero Effect On Private-Sector Job Creation During Recession
    Evidence That Government Spending Does Not Create Private Jobs During Recession

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  2. Thank you for the links, Meng Hu. Much appreciated.

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  3. Oh, and by the way, nice blog. I've added it to my blogroll.

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  4. Hey, Robsie
    Thought you might like this, though you might have read it already
    http://www.nationalreview.com/articles/299425/europe-s-failed-austerity-michael-tanner#

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  5. Heh. That pairs nicely with my piece, no? Thanks.

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  6. Yes, it does.
    I wonder if some smart political strategist might have used the above data to combat the "tax the rich" rhetoric coming out of the WH :-) I mean, he'd have a better case than the "austerity" crowd of claiming the reasons for poor economy.

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