Saturday 23 October 2010

New York Times On UK Coalition Government's Economic Approach: "It Boldly Goes In Exactly The Wrong Direction"

The New York Times offers an insightful take on the Conservative and Lib Dem Government's plan for managing our economy. Here's an extract "Maybe Britain will get lucky, and something will come along to rescue the economy. But the best guess is that Britain in 2011 will look like Britain in 1931, or the United States in 1937, or Japan in 1997. That is, premature fiscal austerity will lead to a renewed economic slump. As always, those who refuse to learn from the past are doomed to repeat it."

Earlier in the article Paul Krugman questioned the logic of this austere approach concluding “In this case, the victims are the people of Britain, who have the misfortune to be ruled by a government that took office at the height of the austerity fad and won’t admit that it was wrong."

Professor Krugman doesn’t duck explaining the real reason for the Conservative/Lib Dem’s approach. “Why is the British government doing this? The real reason has a lot to do with ideology: the Tories are using the deficit as an excuse to downsize the welfare state.” Click here to read the article in full.

Krugman was awarded the Nobel Memorial Prize in Economic Sciences in 2008. He offers a very different view to that of David Cameron (Con), Nick Clegg (Lib Dem), George Osborne (Con) and Danny Alexander (Lib Dem) - who all tell us their way is the only possible way out to build our future economic prospects.


Anonymous said...

Christopher Pissarides is another Nobel Prize winning economist who has attacked the Con Dem's Comprehensive Spending Review. Not this lot are taking any notice.

Andrew Curry said...

The American economist Brad DeLong argued this week - after the Spending Review - that the Coalition leaders are "clueless dorks" because although they're cutting away at public expenditure they have no theory as to how exactly this is going to improve the economy.

Short but sharp: