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October 20, 2010
Do You Belive In the Confidence Fairy?

Forced into the move because they're currently working with a 'coalition' government, albeit one led by the Conservatives, who have a slight vote edge, the U.K. is about to test the neo-con theory that massive government cutbacks stimulate economic growth.

Eliminating nearly half a million jobs is just the start of the plan. People in public housing (the already poor) are going to have to pay more to keep a roof over their heads. Less money for the army that operates in the full light of day but, amid cutbacks almost everywhere else, more money for shadows-of-the-night covert intelligence agencies.*

From economist Joseph E. Stiglitz:

The confidence fairy that the austerity advocates claim will appear almost never does, partly because the downturns mean that deficit reductions are always smaller than was hoped.

This is true. Unfortunately, you can't make people believe in reality. The Right is always quick to insist that something else--media bias or a liberal plot or an unlucky alignment of Jupiter and Mars--prevented austerity from producing plenty.

The NYTimes does a reasonable job of letting the Left and the Right each put forth their theory, without contradiction, early in the story. Later, the details start to come clear.

Britain has about six million public sector jobs, about one fifth of all jobs in the economy, according to the Office for National Statistics. But it was not clear what the impact of shedding 490,000 of them about 8 percent of the total would have on unemployment.

We all know that the right wing believes in the Confidence Fairy.

I guess only time will tell if the Confidence Fairy is willing to return the favor.

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* Bit of 'tude there, sorry.

Posted by AnneZook at 01:51 PM


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