As the icy hand of “austerity” grips Europe and reaches towards America, it might seem like a good idea to examine this widely-prescribed cure for our economic woes and see if it really will solve the problem. The idea that cutting government spending (only, of course, in ways that hurt poor people) is a fundamental truth that was outlined in a study by economists Carmen Reinhart and Kenneth Rogoff.
What my novel pre-supposes is…what if it’s wrong?
Turns out it is. It’s very wrong. The study, which was never peer-reviewed and which the authors refused to provide their data for until recently, had a problem with its spreadsheet and also omitted data that contradicted its conclusions. This was brought to light when the authors deigned to let a grad student at UMass Amherst look at their work (possibly thinking a little nobody grad student couldn’t harm their reputation) and he discovered numerous errors and omissions in it.
This isn’t just a study that provides the basic foundation behind “austerity”, it’s the study. And it’s wrong. Its conclusions are wrong. What it claims is not supported by the data when looked at without the errors. Some economists have been saying for years that the results were not reproducible and the idea that cutting government spending to spur economic growth was backwards and wrong, and this paper was still shoved at them. Our greatest political minds and also Paul Ryan have cited this paper as the reason your benefits need to be slashed, but not theirs.
And the grad student is right. Now that we have the data in hand it’s easy (for people who understand these things, not me) to see that the whole thing is pear-shaped and has problems both accidental and possibly less so.
So where do we go from here? The Austerity Boulder has begin rolling…do we stop it? Can we stop it? Should we stop it? Now that the reasoning behind it has been discredited, it would be wrong to keep going with it, right?
Ha ha, oh, you’re so adorable. Of course not. This changes nothing. The good ship Austerity is not for turning.
There’s no reason we should abandon our plans just because they’re flawed at their roots. After all:
1) We still champion supply-side economics even though that’s been proven, time and again, to be completely wrong.
2) We still champion Milton Friedman’s neoliberal economic theories, even though they’re been proven wrong time and again and even have their own body count.
3) Economists had been saying for years something was fishy and were ignored anyway.
4) Many of the folks who support the above and austerity also believe all life was handcrafted by God about 6,000 years ago despite an entire planet of evidence against that.
In our post-G. W. Bush world what’s true doesn’t matter, just what you believe in your heart. And if you believe in your heart that giving rich people tax breaks while poor people freeze to death will improve the economy, then that’s all that matters. If you sincerely believe that laying people off and cutting government programs (thus laying more people off because did you know “the government” employs actual people and not animated brooms) will somehow create jobs then it would be rude for anyone to tell you otherwise. Conservative philosophy meshes so well with religious fundamentalism because it is religious fundamentalism, and faith is all that matters. Reinhart and Rogoff themselves have already stated that even though the corrected data shows a very different reality from their conclusions, this still somehow supports their conclusion. In what way? In the shut up way.
So, folks like Stephen Colbert and Paul Krugman can make with yuks and mockery over this all they want, but within a month someone will defend the report in passing by saying something like, “There were some minor errors, but the fundamental conclusions remain intact” and go on with whatever monstrous bullshit they want to foist upon poors — assuming they acknowledge this pothole at all.
No, the only thing that maybe, maybe might make Conservatives back off even a little from austerity politics is what always makes them back off a little: when it affects them.