More Proof Austrerity DOES NOT WORK

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Nobody wants to lend to them anymore- especially since they would go right back to the same failed policies.

If Greece had a currency not based on the false theories of the ultra right wing godfather of Austrian economics Carl Menger, it would have no problems at all with financing.

Because the Klingons had put over ninety percent of their budget into their military, they had not experienced significant economic growth for their civilian sector (source - Star Trek: The Undiscovered Country). On top of that, Klingons are like Spartans or Prussians - they take pride in their simple, disciplined life style, free of luxuries.

-Bill, otherwise known as Kraichgauer

Living within their means would have been better than any doctrine. They a 700 Euro a month minimum income for people that spent years deliberately working just enough to get the subsidy (I've heard but have not confirmed that you didn't have to work to get it), spent lavishly on social programs, and had high taxes yet still required massive deficit spending. Now the poor want the assets of the few rich left and lobby for it, the socialists riot for it, and the "rich" (usually small business owners) hide all the assets and income they have because they object to it being taken by people that were freeloaders and they will end up in the street with nothing to show for it if they are honest on their taxes.

Now the Greek socialists demand fiscally responsible countries bail them out AND let them keep spending money on failed policies they way they had been before their economy crashed.

All developed countries should use the Euro-crisis as an example of what not to do!

to be honest. they got in the euro with fake figures and nobody checked

once in it was party time.

now its a mess

Greeks are not being willingly austere.....they are austere, because they technically went bankrupt.

[youtube]http://www.youtube.com/watch?v=QzE76nUSjL8[/youtube]

Did you even read the articles I posted? Austerity is a failed policy if the object is paying down the sovereign debt and reforming their welfare systems.

Austerity is shrinking the GDP of those countries every year. At this rate none of them will ever pay down their debt! That's why even the IMF is arguing against austerity these days.

Let me say this again:




The thing is, many people on the right don't really care about actually solving these problems. They seem to be much more interested in PUNISHING the people of Greece, Spain, (and the 47% in America if they had their way) for financial irresponsibility.

We need to solve these problem for the good of the whole world.

All the conservatives who seem to get a hardon at the thought of making poor people suffer need to go get some therapy.

I'm unclear on how doubling your debt helps you pay it off quicker. That's the kind of logic I expect to see from a Judge Judy defendant.

It is as if, not content with violating basic economics, you have your heart set on also violating thermodynamics.

How do governments dependent on tax revenue make money when GDP is in free fall? You cannot get blood from a stone.

Let me give you a smaller scale real world example,

I used to work for a family owned small business just coming out of bankruptcy. The father had run the business into the ground and creditors shut the place down.

The two sons said to the creditors, "Keep the place shut down and you have some land and a worthless, worn-out factory on it. Let us open it back up, and we can make the money to pay you back."

The brothers got a small loan, hired me and we automated the plant as extensively and cheaply as possible. Within two years they were not only debt free, but profitable.

Starving these countries will result in nothing but losses. Smart investment to promote growth might actually let them pay their debt some day.

No investment, no return THAT is basic economics.

I don't think there's any question austerity is failing economies. I agree with you absolutely.

My opinion is it's likely the world's richest people - the kind who own their own islands and media outlets - know fully well what austerity is doing to countries like Greece and the United Kingdom. They refuse to make any concessions because they've made a Faustian pact. To stay forever young and fulfill every pleasure, they must have their large pot of wealth.

Capitalism is failing because the capitalists don't want to create jobs. They want to keep their profits for their own luxury. If capitalists reinvested their profits into creating jobs and investing in infrastructure we would see growth. Instead, they give what little they do hand out to their shareholders, only because if they didn't they couldn't maintain their lifestyles.

Smart investment is indeed the way to do it. However it is an impossibility when the controlling entities (aka gov. policies & tax laws) make it punitive to do so. They want their cut and that cut keeps the broke..broke..and the wealthy in their top positions from such payments.

There is also the fact that the wealthy can only sustain themselves by draining those below them. Capitalism itself functions on the premise that there is unlimited growth and that there always will be growth. That is not the case.

I too think that capitalism is starting to collapse as an economic system. What will replace it may be small government, free market system sustaining a socialist safety net.

If you starve something it gets thinner. Our ecomony needs feeding, not starving.

Debt means that you're spending more than you're making.

This is radically different from capital investment.

If your debt is rising, then your expenses are outpacing your net income. That IS starvation. Feeding would take the form of rising profits that outpace expenses; you are eating more than you are using.

Maybe it would help persuade me if you guys could show charts that illustrate how increased debt results in increased revenue to an even higher extent; is your country a good investment?

The most important metrics for a national debt is Debt to GDP ratio. If the deficit amounts to less than nominal growth, a country gains ground on the debt. Thus, this idea that only a surplus causes gain to be made on the debt is a false one.