What is the logic behind austerity?

[Questionable]

I keep reading all these news articles about the massive unemployment rate in Europe and how austerity cuts are ruining everything, yet EU officials and some American politicians continue to call for them.

How is austerity supposed to work? Is it really just the bourgeoisie protecting themselves while letting the rest of us starve, or is there something more complex about it?

[Lynx]

Austerity is debt hysteria being applied during an economic downturn. Mainstream economists are divided on whether this is a good idea. During boom times, austerity is synonymous with supply side theories.

[BIXX]

I was at a protest on Nov.3rd against austerity. Personally it feels like the bourgeoise protecting their own asses, but I can't really prove it. We are having public education, postal service, affordable housing and affordable health care cut (among, I believe, some other things, but I can't remember what they were off the top of my head). Overall the protest was unsuccessful, for several reasons, like corporate media bashing us (go figure) and the people who were at the protest mainly using the fact that we were pepper sprayed to pull together sympathy and ignoring the original cause.

[GPDP]

It's basically the bourgeoisie wanting to have their cake and eat it too. They want to save the system from crisis without paying higher taxes or reducing spending on shit like the military. Why should they pay or cut back on the institutions that help them gain bigger profits, when they can just make everyone else pay instead?

[Os Cangaceiros]

You may find this of interest, from Endnotes:

two aspects of austerity (http://endnotes.org.uk/articles/16)

[Oswy]

One of the ailms of so-called 'Austerity' is to dismantle, as far as possible, all institutions of public redistribution or which otherwise operat free from market colonisation. In countries like the UK 'Austerity' is being used to justify the dismantling or takeover of public services for the benefit of private enterprise and, ultimately, the capitalist class. By making the people suffer through 'Austerity', however, capitalism is making a future rod for its back - when the next crisis wave hits there'll be no public assets to hand over to the bankers to save them.

[ÑóẊîöʼn]

That's what really boils my noggin about this whole austerity business - surely there are elements of the upper echelons of capitalist society who recognise the central contradiction of austerity for what it is?

I can see the point laid out in the article Os Cangaceiros linked to - that the resolution of the contradiction may not necessarily entail an end to capitalism as a whole - but the point raised by Oswy is a good one; how are they going to resolve the next crisis when there is nothing left to flog off?

I also think that such a resolution of the contradiction, if it favours Capital over Labour, can only serve to further de-legitimise the former. How can anyone convincingly tout capitalism as the best and only game in town when it generates increasingly dire material conditions for the greater mass of humanity, especially when such conditions become the norm for more and more people in so-called "developed" countries?

[Red Economist]

It is essentially a political argument that, by cutting the budget and the size of the state, the private sector will grow in it's place (known as 'Crowding Out'). This rests on the assumption that the Market and the State as seperate entities and the Market is self-righting. both of which are historically dubious and driven more by ideology than economic theory.
It belongs (probably) to libertarianism and an extreme form of neo-liberalism. (I think even milton freidman, as an ex-keynsian, supported deficit spending during a recession/great depression).

However, (If I remember my A-Level economics correctly) a Keynesian will point out that by reducing government expenditure you reduce aggregate demand (the level of demand in the economy) and therefore deepen a recession because demand will contract (with reduced output and price levels), which is what actually appears to be happen. [although inflation is still going up?]

Aside from this I haven't heard any other justification other than because "the banks say so" and "The market is always right".

[Dennis the 'Bloody Peasant']

We continue to be forced to suckle at The Market's rancid teet and be grateful for whatever foul-tasting gunk gets squirted out. All hail the 'job creators', 'entrepreneurs' and other positive sounding buzz words that spew like sweet-smelling vomit from the gobs of Cameron, Osbourne et al.

[Art Vandelay]

It's capitalists tempting the working class to revolution; however, unfortunately, economic downturns will never bring about revolution and those waiting on that to happen are misguided.

[Q]

It's capitalists tempting the working class to revolution; however, unfortunately, economic downturns will never bring about revolution and those waiting on that to happen are misguided.

Yes, rather the contrary is the case: The immiseration of our class leads to political apathy more than anything else, although discontent does tend to grow. Bourgeois politicians on the right can exploit this discontent and this can lead to further problems.

Austerity therefore, it must be emphasised, is a political agenda and has little or nothing to with "economic housekeeping" (which is a nonsensical argument anyway): The point is to destroy the working class as a class-for-itself and destroy any possible fertile ground where it could possibly flourish, in order to have this idealist "pristine" free market capitalism. This has in fact been at the core of the neoliberal agenda for the past 30 years.

To adapt a popular saying: It's not the economy, stupid. It's the politics!

[Thelonious]

Is it really just the bourgeoisie protecting themselves while letting the rest of us starve, or is there something more complex about it?

No... there is nothing more complex about it. You are correct.

[RadioRaheem84]

In the US, the word austerity is not used. We use the phrase, "tighten our belts".

[Oswy]

No... there is nothing more complex about it. You are correct.

It suits their corporate media to present it as more complex, however, indeed to present it as something else entirely!

[RadioRaheem84]

There is no debate about it in the US at least like there is in Europe. The debate begins at, "well we all know that something has to be cut, just what" ?

Experts on panel shows and political talk shows will all throw a fit if you even hint at the idea that austerity is not the answer and that higher taxes or even dare you say nationalizing some industries (you won't even make it on air) is the answer. They will shout you down as not knowing basic Econ 101 and whatnot.

There is a framework in this country. It's a box that's hard to break out of. Our media is a private version of Pravda or as insular and bad as North Korean state TV in some regards.

[Thirsty Crow]

To adapt a popular saying: It's not the economy, stupid. It's the politics!

Really? So it must be that capitalists would happily invest in an expansion of production which would provide employment for millions and it must be that the interest rates on state debt would not rise?

It's ridiculous to divorce the real and actual problems which are faced by capital nowadays from "the political".

[RadioRaheem84]

Really? So it must be that capitalists would happily invest in an expansion of production which would provide employment for millions and it must be that the interest rates on state debt would not rise?

It's ridiculous to divorce the real and actual problems which are faced by capital nowadays from "the political".
Are you disagreeing from the rest in here that say that it's merely a political attempt to seize more economic power?

[GPDP]

That's what really boils my noggin about this whole austerity business - surely there are elements of the upper echelons of capitalist society who recognise the central contradiction of austerity for what it is?

I can see the point laid out in the article Os Cangaceiros linked to - that the resolution of the contradiction may not necessarily entail an end to capitalism as a whole - but the point raised by Oswy is a good one; how are they going to resolve the next crisis when there is nothing left to flog off?

I also think that such a resolution of the contradiction, if it favours Capital over Labour, can only serve to further de-legitimise the former. How can anyone convincingly tout capitalism as the best and only game in town when it generates increasingly dire material conditions for the greater mass of humanity, especially when such conditions become the norm for more and more people in so-called "developed" countries?

This is where propaganda and repression come into play. I'm sure most of the ruling class realizes the potential danger in immiserating the working class. The plan then, is to shut out all debate on a possible alternative, and manufacture consent for the ruling order of the day, and anyone who still tries to fight the system will face the consequences.

Basically, instead of solving the crisis through appeasement, they have chosen to beat us down, then attempt to fool us into believing this is the only course of action, and then, well, hope for the best. And if the best does not occur, then I think the gloves will finally come off and we'll see actual, visible violence from the state to put us back into line. If not through words, then through the baton, they will say. Only then will capitalism finally be laid bare for all but the most blind to see.

Not sure what they're gonna do about the next crisis, however, when there are no longer enough funds to bail out the capitalists then.

[Thirsty Crow]

Are you disagreeing from the rest in here that say that it's merely a political attempt to seize more economic power?
I'm disagreeing with the notion that there's actually nothing wrong with the conditions for capital nowadays. It's not the economy, but...what? Is not this attempt actually conditioned by the more narrowly conceived "economic"?

And of course I disagree - that would be an understatement - with the polar opposite of that view, the view of bourgeois apologia, which states that austerity is merely a technical matter, of efficiency and temporary necessity.