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Here's what the IMF (a member of the Troika) has to say: https://systemicdisorder.wordpress.com/2012/10/10/quietly-the-imf-confesses-that-austerity-does-not-wo

Here's what the IMF (a member of the Troika) has to say: https://systemicdisorder.wordpress.com/2012/10/10/quietly-the-imf-confesses-that-austerity-does-not-work https://systemicdisorder.wordpress.com/2012/10/10/quietly-th... >The IMF said a common figure used by governments was to assume that for each dollar lost in government spending, 50 cents is erased from gross domestic product, an assumption used when creating austerity budgets. But, the fund said, its study of the issue has found that, since the economic collapse that began in 2008, for each dollar cut from government spending, GDP is reduced from 90 cents to $1.70. i.e. yes it cuts your deficit, but your public debt/GDP gets worse.

AnimalMuppet 12y ago
Interesting: In "normal" times, adding a dollar of government spending adds 50 cents to GDP, that is, it's inefficient. I don't find it surprising that things changed in 2008 - we entered a very different economic environment then. So austerity was a bad (even disastrous) policy choice starting in 2008. But it seems reasonable to ascribe the bad choice to the troika being unfamiliar with that new environment, rather than to "pure class warfare". (Except once they learned that the conditions changed, doubling down on a non-working policy is less easy to justify.)