P.17
Implementing a sweeping
austerity program that focuses
on cutting entitlement spending,
infrastructure investment and
the reduction of the size of
government is usually forced
upon a country by its borrowers
as a last resort, which is what we
have seen occurring in Europe
with Greece, Ireland and Spain.
In rare circumstances, countries
will proactively enforce specific
concepts derived from an austerity
programme. An intriguing
example of this is the UK’s recent
implementation of portions of
an austerity plan to try to repel
a more significant problem in
the future. Austerity measures
are, sometimes, even carried out
through political backfire which
is exemplified by the US budget
sequesters.
Although austerity has been the
centre of dispute throughout the
world when discussing economic
uncertainty, one extremely
Austerity is generally not desirable important lesson we must learn is
that countries need to be able to
It is not any government’s goal
control the alluring distraction of
to be cornered into this position;
excessive government spending. In
austerity programs are largely
proportion, controlled government
unpopular in the short term due
spending could propel an economy
to the fact that it can cease an
long-term, but wasting money on
individual’s entitlements or their
programs that are unnecessary is
employment because of necessary a definite faux-pas. A Thoughtful,
job cuts. The reaction to these
affordable and methodical
measures is often loud and visible approach must be taken when
through protests and riots (as we
borrowing money and, if it is within
saw in 2011 in London), and often a country’s means, will prevent
time can weaken the existing
future bouts of austerity.
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Success with austerity?
As previously discussed, the UK
(one of the few developed countries
to pro-actively implement any
serious austerity measures) is
seeing positive economic signs as
reported by the Office of National
Statistics, the CBI, amongst others.
Certain reports also show the UK to
have one of the highest projected
economic growth rates in Europe.
There is, therefore, some evidence
that the short-term pain can be
resolved with rewarding benefits in
the long term.
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government and their hold on
power.
The question is, if a government
finds itself in a position where
they are forced to even consider
such measures, can they work? It is
highly unlikely that countries like
Greece, Ireland and Spain could
have continued to function prior
to the austerity programs that
were imposed. Even though there
is still work to be done, each of
these countries appears to have
corned a corner and economic
conditions have improved despite
the implementations of austerity
measures. Particularly, the cost of
borrowing has reduced significantly
indicating greater confidence in
their ability to pay back their debt.
Whitonomics
As a result, more and more of
the money collec ѕ