...Paul Krugman ... is a keen student of the British economy. And a stern critic of the way it’s been managed. ... Krugman argues that what the Brits have been doing to cut their debt is completely counterproductive. ... The British government should borrow more to spend more, to spark up the economy.
British Finance Minister Matthew Hancock dismisses that as nonsensical:
"We have a massive borrowing problem. We have overleveraged banks and they’re a drag on the economy. And the argument that you can borrow your way out of debt doesn’t make sense," claims Hancock.
The government and its supporters concede that the deficit reduction plan has hit a sticky patch. They admit that growth has faltered. But they deny that has anything to do with austerity. ...Robert Shrimsley at the FT:
Scientists at UK plc’s research labs used the 2013 Budget to reveal that their much vaunted wonder drug – Austerity™ was not yet ready to go global. Other nations had been watching its development with great excitement but regulators now say they have found serious side effects in the late-stage trials that made it unlikely to secure approval outside Germany and the Netherlands. ...
George Osborne, the economic scientist behind the development of the Austerity™ drug,... insists that Austerity™ works, saying the data have been corrupted by confounding effects such as higher oil prices, a eurozone crisis, a falling pound, the Queen’s jubilee, bad weather and the Olympics.
Mr Osborne admitted that the test results were a setback but said his team would press on. ...No sense changing policies that aren't working. Unless, of course, the real policy is something else and it's working after all. There's a reason conservatives like austerity despite its "failure".