"So, on 21 September [2022], when Federal Reserve Chair Jerome Powell announced his fifth interest-rate hike of the last nine months, this dirtiest word in economic policy [austerity] was conspicuously absent from his remarks. Instead, Powell described the process of resetting the economy – through the introduction of increased unemployment and possible recession –as a necessary form of “economic pain.” Powell’s comments echoed those of his British counterpart, former chancellor of the Exchequer Rishi Sunak, in a letter to Boris Johnson: “[the public] need to know that whilst there is a path to a better future, it is not an easy one.”
This framing of monetary policy as some sort of war effort – hard work and individual sacrifice for the greater good –has been part of the playbook for instituting austerity policies for more than a century. In 1920, at the first international financial conference in Brussels, British civil servant Robert H Brand evangelized economic narratives focused on this “hard truth”: in order for the economy to get back on its feet after World War I, “the answer is a very painful one and yet a very simple one. We must all work hard, live hard, and save hard.” As Powell, Sunak and Brand demonstrate, the road to austerity is paved with vague euphemisms."
This framing of monetary policy as a war effort-- sacrifice, saving, thrift and austerity-- might go even further back, the late 18th and early 19th centuries and the dawn of capitalism in Smith (saving as the root of all industry) and definitely Malthus (scarcity and the struggle for existence). But, yeah, austerity economic policies are certainly still with us.
Consider the election as a sort of revenge of austerity economics. The working classes were hit hardest by the post-pandemic supply chain inflation of '21 and '22, so blatantly misdiagnosing the source of the inflation the Fed decided to compound the working classes economic pain by jacking up interest rates and making home and car loans too expensive for most workers. And now a winning plurality of the working classes voting against the government that presided over these rising costs of living (primarily boosted by private business interests) has elected a party whose platform, Project 2025 (surprise, surprise), promises to slash government services essential to the many, the working classes, public education, health care, and social security, which the austeritions, Lusk, republicans, decry as wasteful and indoctrination. It's like an anti-labor austerity economics trifecta.
No comments:
Post a Comment