Austerity is strictly a policy of the creditor caste. It has never worked, but it is always the first policy implemented. "For their own good", it is always said. But the premise is always wrong. These countries are rarely, if ever, spending out of control. Like this cycle, it is always an income shortfall. Austerity throws people out of work and amplifies the shortfall in income. Meanwhile, asset prices plummet and the only people with money, strangely the same creditor caste forcing the austerity programs, snaps them up for a song. Lather, rinse, repeat. It doesn't matter whether its the Third World Debt Crisis, due to plummeting raw materials prices...or Russia, with state assets sold for pennies on the dollar, or East Asia. The only winners are those that refuse to play the game. The losers are multitudes. Heck, they lost Stiglitz over a decade ago, but it doesn't matter. When the chips are down again, it's always the Jeffrey Sachs of the world calling the shots. So we can't defend austerity...because of an Excel spreadsheet error? Are you kidding me? Adolf Eichmann is kicking himself in hell. I should haff zed it vas a circular referenz! So this means we're gonna tell Ireland, Greece, Cyprus, Italy, Portugal and so on all is forgiven? Oh, its okay now! You can go to 110% not 90%. Here's some money for those social programs we made you cut to get loans. Uh...probably not. Greece is at 27% unemployment and children are starving across the country. Reinhart and Rogoff get scolded for not updating their formulas.
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