fordy said:
Kasz216 said:
fordy said:
Kasz216 said:
spaceguy said:
Austerity has never worked in history. |
I dunno, it's worked out pretty well for Germany, Australia, New Zealand... pretty much every country that avoided major financial crisises.
Additionally it's paying off well for Ireland.
Really it's all a matter of what you mean by work.
Does Austerity fix the problems right away? No. However lack of austerity causes problems to last longer, because government spending can not create real growth, but only assisted growth, which doesn't properly represent the market, and therefore causes a longer reorginization, where when goverment money is pulled away, stuff that relied on such money failed.
So really it's a matter of, do you want Austeroty, and then bottom out quickly and recovery quickly.
Or do you want more spending, and have a very slow very weak recovery for a while, followed by another drop/stalling forever as everybody has to readjust to an economy that doesn't really work.
Me, i'd rather have a short amount of hardship with a quick recovery that puts us far ahead of where we would be as we try and gently pull on a bandage.
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So what Austerity measures did Australia take?
- They provided stimulus packages for low and middle class
- They spent in infrastructure, such as the NBN (the largest project undertaken at $42bn) and looking for a very fast rail project, speculated to cost close to $100bn
If you ask the people around here, they'll say that the federal government's spending is "out of control", yet they handled the financial crisis just fine.
How is Australia doing Austerity again?
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The fact that Australia never went crazy in the firstplace on deficits and ran their economy fairly smart. Spending levels on what Australia is doing would be considered austerity in most places in the world.
I mean, complaints about austerity in a lot of countries are just silly. For example, in the US if you let the republcians go hog wild and cut everything they wanted to cut... we'd still spend more in 2014 then 2013, which was more then 2012.
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That makes absolutely no sense.
Austerity refers to a change, not a state. That's like say you're going fast because you're stationary and everyone else is driving in reverse. In fact, the only reaction to the GFC was stimulus (ie MORE spending), and measures to pressure banks to lower interest rates, which were far more effective than any proposed spending cut would have done.
Read up on the Four pillars policy imposed by the Keating government.
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I know what they were, though the truth was, Australia really wasn't facing any big issues due to the GFC in general. Australia never had a reccession in the first place. The GFC measures it took were pretty much just shadowboxing.
http://www.cbsnews.com/8301-505125_162-51352693/how-australia-ducked-the-crisis/
Responsible countries avoided the GFC, irresponsible ones got hit.
The arguement now is irresponsible countries should be more irresponsible to get out of it's problems.
Austerity is actually doing a fairly decent job in places like Ireland, it's just covered up because well... GDP includes government spending in GDP. So of course GDP takes a hit when government spending is reduced. Most of the other countries like Greece are so fucked up at a pure conceptual level it will take FOREVER to get anywhere with ANY system.
