Noah denkt™  -
    Project for Philosophical Evaluations of the Economy
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But do pro-growth policies actually work?
Statement in response to the parliamentary elections in Italian, drafted on Feb. 25., and published on Feb. 26,
2013
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Dear Italian voters,

If there was any doubt about this the results of Sunday’s election in your country confirm that you, the majority of
Italian voters prefer a less rigorous austerity approach in domestic economic policy and opt for a growth
stimulating, i.e.
Keynesian spending approach instead. In view of that it is worth reminding you of the following
facts:

  1. On the same day that you choose to distance yourself from the rigorous austerity policies, the EU is
    supporting,  the British Chancellor of the Exchequer, Mr. Osborne, reaffirmed the UK’s commitment to
    continue with its stringent debt cutting plan (George Osborne: We'll redouble effort to cut debt after AAA
    loss.  In other words, Britain, the home of Mr. Keynes himself, continues to do what you yourself perceive to
    be a German diktat. Now, what do you make of that?
  2. But we do not have to take a country run by conservatives to prove our point here. Take the United States
    instead. Because that country has under the leadership of Mr. Obama tried to stay away from the  “overly
    rigorous” fiscal belt-tightening that Brussels is advocating for. And lo, the US economy isn’t exactly booming
    either. Instead the United States is now facing the danger of a fiscal sequester largely because a sizeable
    number of lawmakers are worried that not enough adjustments may have been made to bring the US debt
    back into viable territory. That doesn’t sound great, does it?
  3. In Japan, at the same time, all attempts to overcome the deflationary pressures in the economy by
    introducing stimulus packages and low interest-rate policies have equally been unsuccessful to revive that
    country’s economy. Japan’s fiscal debt, however, has reached scary proportions in the process.
  4. Mr. Hollande’s France, meanwhile, has been slow to embrace Monti-style economic policies, arguing that
    too much austerity is counterproductive for the national recovery. Despite its more measured approach to
    fiscal discipline, however, France has failed to produce the growth it so desperately needs. To the contrary,
    the French economy is continuously loosing ground to its German competitor. And who could possibly want
    that?
  5. Italy itself, in turn, was actually pursuing the laxer fiscal policies that you, the Italian voters, apparently
    prefer before Mr. Monti was called in to take over from the then disgraced Mr. Berlusconi. And yet, these
    earlier Berlusconian policies didn’t do it for Italy either. To the contrary, the markets got so spooked by Mr.
    Berlusconi’s denial of the severity of Italy’s debt problem that they played an important part in ousting him
    from power.

Conclusion: Is it not time to face up to the truth now?  Can we really, continue to act, as if it were a given that pro-
growth Keynesian policies actually produce the sustainable growth we want? - Well, you won’t be surprised to
hear that we at
Noah denkt™ believe we can’t. And hopefully you will eventually come around to agree with us.  
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Keywords:


hung parliament in Italy, Italian elections, austerity in Italy, Monti's electoral defeat, protest
vote in Italian elections,  failure of Keynesian politics, opposition to austerity, Berlusconi's
comeback in Italian election, austerity policies versus pro-growth policies