"Austerity" is a Conspiracy against Humanity
Nobody at the top thinks austerity will do what is promised. (In today's economy. Austerity is fine during an economic boom but utter disaster in a demand and employment crisis.)
There isn't a scrap of evidence in support of the extraordinary proposition that austerity=growth, and not even much theory, but there are some economists who think that reducing government deficits increases employment and GDP because they are ideological idiots. And some more who "believe" it because their job description is, "An economist who believes this shit."
Such is life... there are always some "experts" in high places spinning for whatever world-view is most convenient for the super-rich. Hiring delusional true believers to front for the enterprise is always part of the overall scam.
For instance, Bush hired every mental defective in the world who believed in the Iraq WMD as a military or foreign policy adviser. But that doesn't mean that everyone at the top believed in the WMD. Some folks thought invading Iraq was good thing geopolitically or for domestic politics (eg. Rove) and if the half-wit true-believers talked themselves into a pretext that was useful.
Another for instance: There were a few economists stupid enough to think the Reagan tax cuts would not explode the deficit. But we know for a fact today (because he admitted this decades ago), that budget director Stockman understood that the Lauffer curve was nonsense and that the tax cuts would explode the deficit. So why did the inner circle want them? Because they thought exploding the deficit would serve the greater good of getting people to want government to be smaller.
A lot of people know full well that austerity, in today's world, can only increase unemployment but support austerity anyway because it serves a greater agenda—keeping inflation as low as possible. Unnaturally low inflation is what created and maintained the international finance juggernaut. It protects idle capital and fuels asset bubbles. It makes people who loan money rich.
And any amount of human suffering is okay as long as the economy is not allowed to get rolling, which would ironically be worse for financial institutions than our ongoing stagnation. (Anyone who doubts this, look at the stock market which is decoupled from unemployment and GDP. A nightmare economy for workers can produce huge corporate profits if handled right.)
(Remember James Carville's immortal quote... when Clinton took office it was the first Democratic crack at the job in 12 years. A lot of people had a lot of programs they wanted. But Carville found that all proposals had to be scaled back in deference to the concerns of the Treasury team who were primarily concerned about interest rates. Carville said that when he died he wanted to be reincarnated as "the fucking bond market" because it seemed that was what really ran the world. For the record, the US Treasury market today is the strongest it has ever been. Ever. In history.)
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