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Politics in the Austerity State. Olaf Cramme (2013)

August 24, 2013

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“The bottom line is that years of debt accumulation have increased the likelihood of a permanent ‘austerity state’ (Pierson, 2001), one in which deficit-financing of public entitlements and private prosperity over a longer period of time becomes a matter of the past. Instead, fiscal prudence and consolidation is the new norm, not the exception. This is different to claiming that something like a maximum level of debt (say 90%) exists beyond which macro-economic performance would inevitably suffer. Such a debate has proven flawed then and now. But it does mean that in an era where creditors can rapidly lose confidence in the ability of debtors to repay loans, some form of austerity – however broadly defined – is likely to prevail. This creates an additional dimension of constraint for policymaking space at the national level, which is caused by legacy as much as institutional and political choice.”


“Some therefore argue that Freud’s narcissism of small differences has never resonated stronger than in Europe’s post-democracy. It has become almost impossible to work out how society, let alone one’s own life, will actually be affected by whoever governs, so trust, honesty and competence in an increasingly ‘presidential’ parliamentary system make the small difference. Swings towards the Left or the Right are better explained by the attractiveness of the respective leaders than big changes in the political preferences of the electorate. Credibility is the first benchmark”

Manuel J. Matos‘s insight:

Things to think about …

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