Whatever Does Paul Krugman Mean By "Austerity" in the UK?
Over at the New York Times this morning, Nobel Prize winning defender of government spending Paul Krugman pulls out some charts to show that economic growth in the UK for the past few has been less than some people think they guess it might have been given the historical record. (That is, "the output path has now diverged below what a wide range of plausible historical projections might excuse," harumph.)
The Krug blames this on….don't cheat….
Gee, remember the enthusiasm with which the Cameron/Osborne turn to austerity was greeted by VSPs on both sides of the pond, with David Broder urging Obama to "do a Cameron"?
It always becomes the Nobel Prize winner to use the rhetorical dismissive "Gee." I believe they are instructed to do so in all their serious writing henceforth.
What Kruggy baby does not provide is any definition of or evidence for "austerity."
From the charts gathered at UKpublicspending.co.uk, if they are true, we find that from either 2007 or 2008 to 2011, UK government spending has gone up both in total numbers and as percentage of GDP.
From 2007 to 2011, 543.96 to 681.33 billion pounds total spending; from 2008, 575.97 to 681.33. The GDP percentage of total spending in 2007 was 38.69, in 2008 40.17, and in 2011 45.13. Population increase from 2007 to 2011 has been about 1.5 million.
Possibly relevant subcatagories such as welfare have also seen rises in both terms of GDP (from 5.91 percent in 2007 to 7.46 in 2011) and raw numbers (83.09 billion in 2007 to 112.68 billion 2011). Transportation the same, rising from 18 billion in spending in 2007 to 19.86 billion in 2011, and from 1.28 to 1.32 as percentage of GDP from 2007 to 2011.
I know that to Krugman it's an article of faith that if growth is insufficient, then government spending has been insufficient. But if he's going to throw around the word "austerity" so much he should explain precisely what he means. I noted Krugman's unwillingness to actually give facts when speaking of European austerity back in May.