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Politics

The end of the 'confidence fairy'

33 replies

breadandbutterfly · 20/05/2012 17:25

www.nytimes.com/2012/04/27/opinion/krugman-death-of-a-fairy-tale.html?_r=1

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MarySA · 20/05/2012 22:16

What is the answer then? I can't see how spend spend spend can make things better. So if the Greeks vote against austerity and carry on spending who is going to pay for it. Don't know who will win the next election but I think the Lib Dems are finished.

claig · 20/05/2012 22:26

Very good Guardian article. The journalist is right that the victory of Hollande and teh Greek people's rejection of austerity is a significant change. People no longer trust their elitist, out of touch politicians who tell them that austerity is necessary for the people, while they bail out teh bankers who still receive their bonuses.

The new breed of politicians is actually listening to the people and not the bankers and is rejecting austerity. And frankly that is the right thing to do. So if it means that left wing parties defeat right wing parties then that is how it should be because listening to the people and carrying out the right policies for the people is what is important, not left or right.

Cuts are not the way out. Spain and Greece have been cutting and cutting and the rating agencies still downgrade their credit. Cuts don't bring growth, it is spending that brings growth. But not wasteful spending; spending on productive things that provide employment and infrastructure etc.

Instead of loaning billions and trillions to banks, invest millions in people and companies, and the economy will begin to turn around.

breadandbutterfly · 20/05/2012 22:29

You are the voice of reason, claig.

(As long as no-one mentions ants.)

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breadandbutterfly · 20/05/2012 22:30
Wink
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claig · 20/05/2012 22:32
Smile
noddyholder · 21/05/2012 15:40

The US were doing better but there are signs of contraction there again

amicissimma · 21/05/2012 18:24

This reply has been deleted

Message withdrawn at poster's request.

breadandbutterfly · 21/05/2012 22:32

It depends if you believe that it is possible to keep cutting without harming the economy and this actually making it harder to pay back the debt. For example, you could cut all expenditure on infrastructure and training to the bone - but that would be really short-sighted as you'd ensure that in a few years' time your economy would grind to a halt.

etc.

So what looks like spending in the short term might be productive in the longer term.

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