Austerity now!

Both the UK and the Netherlands decided on austerity, how’s that working out for them:

However it is worth noting that the UK and the Netherlands have both experienced sharp falls in real wages in the recent past. The OECD expects real compensation per employee to have declined by a total of about 4.5% in the three years 2011-13 in the Netherlands, and by about 5% in the UK. The decline in the Euro area as a whole has been much smaller, at less than 2%. In France real wages have increased a little in all three years. Figures recently calculated by the House of Commons library show a similar picture, with only Greece and Portugal doing as badly as the UK and Netherlands since mid-2010. [2]

In both the UK and the Netherlands we have recession and fiscal austerity, where the recession has been associated with marked falls in real wages as well as increases in unemployment. In both cases I would argue that there has been no effective opposition to fiscal austerity from the political centre, which helps encourage support for the political extremes.
Well hell, I’m glad we didn’t go the Simpson-Bowles route.

1 Comment (+add yours?)

  1. Trackback: Obama should just have been a Republican | Petunias

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