Thursday, January 19, 2012

Killing Europe Cruelly With Economic Austerity

The European Union is embarked on the ruinous path of economic austerity during a recession.    

Across the break are a few highlights from Jeff Madrick's article on the destructive effects of the economic austerity measures implemented in the eurozone.

Jeff Madrick, author of Age of Greed: The Triumph of Finance and the Decline of America, 1970 to the Present, begins his review of Europe's economic situation with the description of a European Union operating in "a vicious circle of burgeoning debt leading to radical austerity measures, which in turn further weaken economic conditions and result in calls for still more damaging cuts in government spending and higher taxes." 

Madrick criticizes Europe's economic austerity measures as being "pre-Great Depression economics."  Then he questions how the leaders of the European Union could "so misread history and treat with contempt the teachings of John Maynard Keynes"; who advocated government spending and tax cuts during recessions.  The European Union is embarked on just the opposite economic path than that prescribed by Keynes.

Madrick further points out that economic austerity "has not worked in one single case in Europe in the last two years." He gives examples of how economic austerity policy has failed the European Union. 

To read Jeff Madrick's complete article please click on the link in the citation enclosed below.

Madrick, Jeff. "NYR Blog: How Austerity Is Killing Europe." The New York Review of Books 6 January, 2012: online edition.

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