When during recessions Keynesian economics is so intuitive (spend on things like bridges and roads – that you need to spend on eventually anyway – to spur growth), why is it conservatives are all over austerity and debt reduction?

    The Guardian does a good job in explaining why

    In this respect, the attempt to systematically reduce the cost of the state on the productive base of the economy, is part of a wider strategy of transferring money to businesses in the hope that it will give them more room to invest. This is bound up with an export-driven growth agenda, as the UK seeks to export more to China and other economies. This growth formula resembles that hit upon by Germany in the EU, as it was able to suppress domestic wages and public spending while exports to the periphery made up for lost demand. And from the point of view of businesses, this looks like a far more plausible solution than those calling for socialising investment, redistributing wealth or a rebooted corporatism – all of which would cost them wealth and power, and none of which guarantee them results any more than austerity does.

    You can read more about this crazy, blinkered, ideological mindset here.

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