Who could have known that cutting government spending during a major recession would slow the economy?
LONDON—The U.K.’s economy suffered a much larger contraction than expected in the second quarter, heightening questions about the pace and effectiveness of the government’s austerity program and fueling the broader debate across Europe about how to tackle the Continent’s economic woes.
The deteriorating British economy is likely to intensify the debate both within the U.K. and other debt-laden countries in the West about cuts versus stimulus, amid increasing evidence that austerity is proving a major drag on growth.
“In the growth versus austerity debate it will boost the growth camp and the argument that it isn’t the right time for the deep austerity measures,” said Vicky Redwood, chief U.K. economist at Capital Economics. “It will put pressure on governments to ease their own austerity measures.”
With the U.K. in a double-dip recession that is its worst in 50 years, the data also add to pressure on Treasury chief George Osborne, who faces calls to ease the pace of measures that critics say are stifling growth.
“Critics ‘say’ are stifling growth? These are the policies that were followed, and the economy slowed. Why does the media insist that this is a matter of debate?
The media is owned and operated by the 1%. The information given to the 99% by the media has been pre-approved by the plutocratic class—the 1%. When ‘Big Brother’ says that up is down and black is white then up is down and black is white. Anybody who believes FOX News(?) knows that to be a fact.
Remember the pundits who bloviate that problems due to free trade occur because there is not enough free trade and solution is more free trade? I expect the austerity loving idiots to spout the same line and double down. Never underestimate the genius of such people.