Why the wrong turn in policy? The hardliners often invoke the troubles facing Greece and other nations around the edges of Europe to justify their actions. And it's true that bond investors have turned on governments with intractable deficits. But there is no evidence that short-run fiscal austerity in the face of a depressed economy reassures investors. On the contrary: Greece has agreed to harsh austerity, only to find its risk spreads growing ever wider; Ireland has imposed savage cuts in public spending, only to be treated by the markets as a worse risk than Spain, which has been far more reluctant to take the hardliners' medicine.Imposing suffering on other people as a sign of leadership? Isn't that a bit harsh? Oh... Here's Frank Field, David Cameron's policy advisor on poverty, and yes he is a Labour MP.
It's almost as if the financial markets understand what policymakers seemingly don't: that while long-term fiscal responsibility is important, slashing spending in the midst of a depression, which deepens that depression and paves the way for deflation, is actually self-defeating.
So I don't think this is really about Greece, or indeed about any realistic appreciation of the trade-offs between deficits and jobs. It is, instead, the victory of an orthodoxy that has little to do with rational analysis, whose main tenet is that imposing suffering on other people is how you show leadership in tough times.
He (Field) suggests that men who refuse to take up a government offer of work should have their benefit removed altogether, a far tougher sanction than they face under the current benefits regime.To do what is the question that springs to mind. Starve? Beg? Rob? Or take that marvellous career opening in a contracting economy that opens up all the time to people Field describes as "the unmarried father who is often young, unemployed and often unemployable and who is unskilled"? Supply side dogma again. And the sort of community education that can make a big difference to individuals is now facing the looming inevitability of cuts.
Never mind, we can be reassured that this is a centrist government for a non-ideological age. Who better to say so than Tony Blair, who now regrets the time wasted in the first two years of the Labour Government ideologically overturning the work of the Tories (can't quite remember that bit myself).
So sorry Krugman, this isn't the triumph of the ideological preferences of Herbert Hoover, it is just good sense.
Well, at least the neo-liberal weather, brutally imposed on this normally sun-kissed nation by the IMF, has relented and it is now a beautiful day. So I am going to stop wasting my life reading the Guardian on-line and simply enjoy sitting in the shade on my patio. Bollocks to the lot of it, here's a YouTube.