European Union

Austerity Lives on in Our Minds and Hearts…


…but in the numbers? Paul Krugman is thrilled that the voters of France and Greece are fighting back against "austerity." While he has plenty of words to work with, he says not a one about actual government spending figures.

Here's an OECD chart, most recent figures available as near as I can tell (if the austerity-ites have more recent ones, it would be good to use them in these discussions) which expresses European (and other) government spending in U.S. dollars (for us U.S.-bound fools), in current prices and purchasing power parity.

Just looking from 2009 to 2010–2010 being the most recent year whose figure are available for most countries–here are the EU countries that spent less in the latter year than the former: Czech Republic (by $1.4 billion), Estonia (by one hundred million), Greece (by $9.4 billion), Hungary (by $.9 billion), Iceland (by $200 million), Ireland (by $1 billion), Italy (by $8.1 billion), Portugal (by $200 million), Spain (by $5.3 billion).

Every one of those countries, though, is spending more than they spent in 2007 (and most of them more than in 2008), and quite a lot more more than in 2004.

For 2004-2010 comparison: Czech Republic is spending $12.7 billion more; Estonia $2.2 billion more; Greece $10.2 billion more; Hungary $8.2 billion more; Iceland $400 million more; Ireland $10.5 billion more; Italy $91.8 billion more; Portugal $16 billion more; Spain a whopping $113 billion more.

So in every case even any apparent "austerity" in the past couple of years is just a slight ramping down from big ramp-ups from 2004-08, approximately. A causal explanation for how and why those dips in government spending in certain countries from 2009-10 are responsible for economic crisis when far lower levels of government spending 7 years ago did not should mention this, and have more to say than "austerity bad for the economy." (The E.U.'s population growth rate has been mostly falling since 2004, though they certainly have more people total than they did then. Google magic has failed me in finding per capita government spending figure time series in the E.U. over the past decade or so, if any commenter has better luck let me know. "Expenditure on Social Protection as a Percentage of GDP" has gone up in nearly every European country from 2004 to 2009, though, according to the chart on page 6 here.)

And in the cases of Germany and France, who Krugman slams as "the Franco-German axis that has enforced the austerity regime of the past two years," Germany's 2011 spending is $26.5 billion higher than 2010 (it is one of the few country's whose 2011 figures are in the OECD chart linked above), and $268.1 billion higher than 2004. For France, its spending rose by $12.1 billion from 2009 to 2010, and by $131.3 billion from 2004 to 2010.

Germany's population growth rate has been negative since 2004; France has added about 2.5 million people since 2004.

European government expenditures up to 1997-2010 as percentage of GDP.

Russ Roberts at Cafe Hayek also wonders where the numbers are on the austerity story:

I have seen many articles on austerity. I can't remember seeing any that suggest that government spending in any European country has actually fallen. Yes, there is talk of spending cuts or cuts in growth rates. But I'd like to see the data that shows the cuts have actually been implemented.

Don Boudreaux also at Cafe Hayek with a 2009 chart of European government expeditures as percentage of GDP–all of them 10-20 percent more than the comparable U.S. figure.

Markets less thrilled than Krugman at the election results.

As Tim Cavanaugh had pointed out before, the guilty flee austerity when no government spendeth less. It is possible that 2012 data will show this austerity, but Krugman and others like him should feel some obligation to throw in a number or two in these austerity discussions.

Johan Norberg from Reason's May issue on how Europe dug itself into its hole.

NEXT: Is Austerity - or Decades of Awful Governance - Responsible for Greek Suicides?

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  1. Well, duh.

    No wonder the EU is struggling – teh Austerity!! It’s monstrous!

  2. in every case even any apparent “austerity” in the past couple of years is just a slight ramping down from big ramp-ups from 2004-08

    Surprise, surprise, surprise!

    Also, R.I.P., Goober.

  3. Doesn’t austerity mean something like raping women while murdering children? Of course we’re against that!

    Oh wait.

  4. When Google fails you, try Wolfram Alpha.

    1. Not another Whedonverse thread…

      1. Did someone say Firefly

    2. Here is an example:

      1. Also, you can crunch the numbers yourself.

    3. Better change your handle; no real mathematician would associate with, much less recommend, Wolfram Alpha. It is a scourge upon the earth.

  5. Tried to listen to Krugman the other day on NPR, but I started to drive very angrily and it became unsafe.

    Being anti-austerity is a bit like being anti-Flying Spaghetti Monster. It’s a non existent deity so any anger is both ignorant and pointless. Austerity, as shown, has never happened so being angry about it is again both ignorant and pointless. Just like Krugman.

    1. In Krugnuts’ mind, Austerity is merely not spending other people’s money as fast as you can.

    2. I listened him long enough to hear him say a secret cabal of billionaires control the right-wing think tanks and make them put out lies that say low government spending is good even though in reality the opposite has been shown to work historically. That’s it; he just posited information without any facts or examples to prove it. I wanted to call in and ask him who funds left-wing think tanks and what historical examples he could give where high gov spending worked to better the economy, but I decided it would be just like responding to trolls. Plus I’m not sure I could have kept my calm when he started spouting some nonsense.

      1. Yeah. He led with that. I nearly barfed and then changed it. Even the host sounded a bit dubious. Still the guy is a lying a-hole.

  6. The open question is what percentage of the current government expenditures is debt financing? I’m assuming that the interest is crowding out other expenses.

    1. The open question is what percentage of the current government expenditures is debt financing.

      I believe that, in the US, interest expense is around $200BB/year, and full-on debt service (including refinancing of expiring debt) is around $500BB/year.

      Total federal outlays are around $3.8TT, so interest expense is just over 5%, and debt service is just over 13%.

  7. Our local helping of brain-dead econ is delivered by Reich.
    Now, it’s possible that they both just hit on the same subject, or it might be that they had a mind-meld, or perhaps one copied the column of the other.
    Someone else will have to compare; I’ve got some drying paint that needs my to be watched, and it’s ‘way less annoying.…..1OBND3.DTL

  8. Krugman is a lying liar.

    1. But does he lie too?

      1. I always though he was a liar. But after seeing RP PWN him in that interview last week, I’m starting to think that just maybe he is that stupid.

        1. Has Krugman been replaced by Kang or Kodos?

  9. The Golden Dawn

    Greek neo-Nazi party Golden Dawn warned rivals and reformers Sunday that “the time for fear has come” after exit polls showed them securing their entry in parliament for the first time in nearly 40 years.

    “The time for fear has come for those who betrayed this homeland,” Golden Dawn leader Nikos Michaloliakos told a news conference at an Athens hotel, flanked by menacing shaven-headed young men.

    “We are coming,” the 55-year-old said as supporters threw firecrackers outside.

    1. All right! Greek Nazis! I bet both Indiana Jones and the Blues Brothers hate them the most.

      1. The Nazis have really embiggened their tent if they’re letting Greeks in now. Maybe the LP could learn something from their skinhead brethren.

    2. Golden Dawn is reportedly merging with Morning Wood. Some question the wisdom of this.

    3. The Hermetic Order of the Golden Dawn is a Greek neo-nazi party? I must reread my Crowley with this fact in mind.

      1. “Do what thou white shall be the whole of the law.”

        1. I thought it was “Do, white: thou will shall be the whole of the law.”

    4. Greek neo-Nazi party

      This is pretty fucking un-fricken-goddam-believable.

      You’d think a nation that was over-run and abused by the Nazis (300,000 starved to death in Athens alone), against whom they fought a viscious resistance, and suffered a number of civilian massacres… you’d think maybe it *wouldn’t* be the ideal place to propose a Neo-Nazi party.

      1. Obviously they won’t call themselves neo-Nazis, that’s just how the media calls them. Historically speaking, they look more like the Spanish Falangists or the Romanian Iron Guard.

    5. Aren’t those the assholes that killed Patrick Stewart? No wait, I’m thinking of Mythic Dawn.

  10. Whenever you see a new Krugman column, it’s opposite day

  11. I’m still trying to figure out which economic philosophy is being employed in the West. Keynes supported interventionism in recessions but assumed that, when not in recession, countries would somehow garner the political will to raise taxes and cut spending. He also explicitly points out that his theory is null and void without a certain level of faith in policy-makers. Krugman seems to be plodding along is if these requirements have been fully met and that we should now proceed with the second part of the equation. I don’t know of any serious economist who thinks that we can spend everything during boom times, and then just craft a stimulus plan that is commensurate with the previous level of profligacy. Yet that is what many seem to be advocating at this point. No surprising coming from Krugman, however, who firmly believes in free lunch:…..heory.html

  12. To the Krugmanian cocksuckers and the Shrikean shitheads,”austerity” is when every loser on planet easth doesn’t get absolutely everything he wants.

  13. Krugman long ago gave up any credibility as a real economist. 100% paid for shill of the print and spend socialists.

  14. Tis a good reason for not HAVING ANY VOTERS.

Please to post comments

Comments are closed.