Forums - Politics Discussion - why do governments impose austerity?

I never understood why governments around the world continue to think cutting services and any industries would help a economy to recover. All austerity does is destroy any chance of creating better services and more jobs and more importantly do what austerity hoped to achieve in the first, which is lower the debt. 

For an economy to work, you have to invest as it creates new jobs and thus for the money invested, more is collected in tax revenues, which lowers the debt.

Simply put, it can be said, "you must spend money to make money"

If anyone here agrees to austerity, please tell me why, i would like to know.



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lol...you realize the public sector is barely 10% of employment right?

Because otherwise you might run out of money someday.

Also most of the 'investments' leak abroad. Austerity works as long as your neighbours aren't doing it.

the2real4mafol said:

For an economy to work, you have to invest as it creates new jobs and thus for the money invested, more is collected in tax revenues, which lowers the debt.

Invest, yes. In infrastructure, or in new businesses.

But just spending money alone (for example, wars, or rebates, or $20,000 routers for a small school district) doesn't "create jobs". The money simply disappears.

I'd like to see firm commitments like: 95% of the US will have 100Mbps Fibre by 2015, or University Education is now indiscriminately subsidised, or we're doubling the efficiency of solar panels by 2020, or we're funding 100,000 apprenticeships at national businesses. THAT's investment.



The deeper you debt the more you borrow from the world bank, with a contract stating that if you can't pay your debt the world bank confiscates your nations assets. Of coarse it only works if your leader is a world bank puppet like obama

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Because its time for a serious reality check?

Because your proposal hasn't worked in the long run?

Because they can?

The things is austerity should be used with other methods. Cutting unneeded and wasteful programs and redirect the money on new programs that have a focus on creating jobs. An example above was buying a router, it doesn't mean you are helping create jobs in your market and most of that money is disappearing usually to another market.

Also taxing the "rich" doesn't help either. A local station had an economist on who tried to put the financial problem in the US into better prospective. (He cut off 6-to-9 zero off the budget, etc) Basically the US spends $330,000 but it only takes in $120,000 in revenue. Even if you take 100% of the people making $250,000 or more money in taxes, you only add another $20,000-to-$30,000 in revenue. Which leaves a loss of $180,000. So any budget that gets passed has to include austerity measure in addition to revenue increases. Because the other shoe will drop. The loss is usually covered by currency speculation and getting money from the world bank. And the US's major investor in this case is China. And China expressed concerns at the end of the Bush era that it really didn't want to continue to support the US overspending but it really couldn't just drop its investment either because of the effects it would have one their market.



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Soleron said:
the2real4mafol said:

For an economy to work, you have to invest as it creates new jobs and thus for the money invested, more is collected in tax revenues, which lowers the debt.

Invest, yes. In infrastructure, or in new businesses.

But just spending money alone (for example, wars, or rebates, or $20,000 routers for a small school district) doesn't "create jobs". The money simply disappears.

I'd like to see firm commitments like: 95% of the US will have 100Mbps Fibre by 2015, or University Education is now indiscriminately subsidised, or we're doubling the efficiency of solar panels by 2020, or we're funding 100,000 apprenticeships at national businesses. THAT's investment.

Yes thats the sort of thing i'm talking about, investing in smaller business' especially



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kowenicki said:
Because its time for a serious reality check?

Because your proposal hasn't worked in the long run?

Because they can?

Well if look at Greece, you will the highest unemployment rates in History and falling standards of living, only austerity could do that. Investment in things like business, only increases debt shortly before helping the economy to keep it growing. Austerity risks stagnating the economy completely



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do some research about how our money system works(a kind of a very slow ponzi scheme and the winner is always the bankster- )
how the bankers are creating money out of thin air(fiat money)
and why is an almost bankrupt country like the USA still spending hundreds of billions of dollars every year to keep a perpetual war running,and why are they still building more and more military bases all around the world though they already have more than 700.
_in the end someone have to pay the prize and austerity is the prize the people have to pay to keep the bankers running their pervert job.
(start watching some george carlin shows on youtube,was a great mind and comedian,he'll explain you the most interessting things in a funny way)

but your question is wrong anyway.
first you should ask;why are 10000 people dying from hunger every day though we produce food for more than 10billion people every year,but "only" 7billion live on this planet.This is far more than austerity.