America simply can't benefit from the interest rate impact of austerity; its interest rates have nowhere to go but up.There is reporting this morning that White House advisers are pushing for a new payroll tax cut.
That was why they took such a risk when they cut the top rate of tax while austerity was still biting hard on so many less affluent voters.
The spectacle was part of a larger trend: according to a recent study, there have been "significant, abrupt, and sustained increases" in the Greek suicide rate following the onset of austerity measures.
After all, the inflationista view of the world has been repeatedly, devastatingly wrong on many fronts — interest rates, inflation, the effects of austerity.
Unlike annuity rates, which have been falling, and dismal savings with rubbish interest rates, some income funds have managed to increase beyond the rate of inflation during the austerity years.
Recently both Paul Krugman and Martin Wolf have thoroughly demolished the idea that the UK enjoys low interest rates because of its policy of austerity and have identified precisely that being in charge of those levers is the key to market confidence.
Basically the whole austerian movement has been wrong about everything for two and a half years — wrong about interest rates, wrong about the effects of austerity on GDP in Europe.
For the truth is that there were some clear and very different predictions from each side of the debate — not about the success of the Obama stimulus, which even advocates like yours truly warned would fall far short, but about interest rates, inflation, and the effects of austerity policies.
There has been a clear increase in suicides among those of working age and older that coincides with the imposition of austerity, taking rates to levels not seen for a decade.
There is also talk of a better regime for taxing intellectual property (which businessmen assume will mean a lower rate).In this section The meaning of austerity A costly war Roll up, roll up Soft touch Osborne's gamble A class above Pot on prescription The imperial moment ReprintsBut businesses will find some less attractive devils in the detail.
