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Thread: Austerity doesn't work: New IMF report details the damage

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    Politics.ie Member lies's Avatar
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    Exclamation Austerity doesn't work: New IMF report details the damage

    In a new paper published Thursday, IMF Economic Counsellor Olivier Blanchard and research-department economist Daniel Leigh show the IMF recommended slashing budgets too fast early in the euro crisis, starving many economies of much-needed growth.

    In “Growth Forecast Errors and Fiscal Multipliers,” Messrs. Blanchard and Leigh calculate IMF and European economists underestimated the euro-for-euro effect of cutting government budgets. While economists expected that cutting a euro from the budget would cost around 50 cents in lost growth, the actual impact was more like 1.50 per euro.
    m.dailykos.com/stories/1176099
    You know what I blame this on the breakdown of? Society. http://www.youtube.com/watch?v=Kw39tcyg7So&sns=em

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    Politics.ie Member tigerben's Avatar
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    As per normal a report comes out when all the damage is done. But to be fair the government in opposition knew this, they said it, they said you can't tax your way out of recession, to much cuts hurts, remember Noonan asking Lenihan " what did the third child do to you". When CA was cut harder. But it shows in government the IMF are the boss, and our politicans are overpaid CS.

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    Austerity was just another passing ideology. So noughties now.
    This sig would be more impressive in Latin.

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    Politics.ie Member Boy M5's Avatar
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    Isn't this story about 2 weeks old. Certainly correct though.
    The IMF - seen as an international bogeyman - is less harsh than our partners in the EU and the ECB - in which we have a board seat.

    As the Economist cover story of a few months ago: A ship already underwater, with the speech bubble "time to start the engines Mrs Merkel"
    No chance in a German election year, unless our Government uses this to pressure the German politicans. Reverse the pressure. Mick Collins would have done so. Time for Kenny to take down Collins' portrait. Maybe John Brutal can lend Enda his picture of John Redmond?
    "Keep firing & don't stop until I tell you" General Tom Barry

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    Politics.ie Member lies's Avatar
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    Quote Originally Posted by tigerben View Post
    As per normal a report comes out when all the damage is done. But to be fair the government in opposition knew this, they said it, they said you can't tax your way out of recession, to much cuts hurts, remember Noonan asking Lenihan " what did the third child do to you". When CA was cut harder. But it shows in government the IMF are the boss, and our politicans are overpaid CS.
    Well, I think that even if various Irish parties had argued against austerity, or the degree of cuts, it would've been largely moot, because we are just some reliant on outside funding.

    I would HOPE that this shift in IMF position can be used as leverage by Irish presure group and ministers to reverse some of the cuts. Hope.

    Of course for that to happen, ministers would have to be mature enough to admit mistakes.

    :/
    You know what I blame this on the breakdown of? Society. http://www.youtube.com/watch?v=Kw39tcyg7So&sns=em

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    Politics.ie Member Howya's Avatar
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    This is old news - the multiplier effect was reported some months ago back in Oct 2012

    http://www.imf.org/External/AM/2012/...nt/eng/ilo.pdf
    “Still paying, still to owe. Eternal woe! ” ― Paradise Lost, John Milton

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    Politics.ie Member lies's Avatar
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    Quote Originally Posted by Boy M5 View Post
    Isn't this story about 2 weeks old. Certainly correct though.
    The IMF - seen as an international bogeyman - is less harsh than our partners in the EU and the ECB - in which we have a board seat.

    As the Economist cover story of a few months ago: A ship already underwater, with the speech bubble "time to start the engines Mrs Merkel"
    No chance in a German election year, unless our Government uses this to pressure the German politicans. Reverse the pressure. Mick Collins would have done so. Time for Kenny to take down Collins' portrait. Maybe John Brutal can lend Enda his picture of John Redmond?
    The paper in question was just published:

    www.imf.org/external/pubs/ft/wp/2013/wp1301.pdf
    You know what I blame this on the breakdown of? Society. http://www.youtube.com/watch?v=Kw39tcyg7So&sns=em

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    Politics.ie Member lies's Avatar
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    Quote Originally Posted by Howya View Post
    This is old news - the multiplier effect was reported some months ago back in Oct 2012

    http://www.imf.org/External/AM/2012/...nt/eng/ilo.pdf
    Different paper:

    www.imf.org/external/pubs/ft/wp/2013/wp1301.pdf

    If you click through the link in the OP you'll see this is a new report.
    You know what I blame this on the breakdown of? Society. http://www.youtube.com/watch?v=Kw39tcyg7So&sns=em

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    Politics.ie Member Boy M5's Avatar
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    So they've announced it twice.
    Brilliant!
    Thanks for the links.
    "Keep firing & don't stop until I tell you" General Tom Barry

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    Politics.ie Member lies's Avatar
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    The precious admission, not based on the IMF paper I linked:

    m.washingtonpost.com/blogs/wonkblog/wp/2012/10/12/imf-austerity-is-much-worse-for-the-economy-than-we-thought/
    You know what I blame this on the breakdown of? Society. http://www.youtube.com/watch?v=Kw39tcyg7So&sns=em

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