Austerity hasn’t worked for Ireland or Europe and we need to move on

THE right-wing characterisation of those fighting against Europe’s austerity agenda as dim-witted profligates was dealt another blow last week when a study underpinning the slash-and-burn policy was roundly debunked.

In 2010, two Harvard professors, Carmen Reinhart and Kenneth Rogoff, published a hugely influential paper, Growth in a Time of Debt, which claimed that economic growth falls off a cliff once a country’s debt to GDP ratio passes a threshold level of 90%.

The paper was deemed so significant that it was quickly being cited by doctrinaire politicians in the two biggest economies in the world, the US and the EU, as the rationale to persist with crippling austerity measures. Last year, Republican congressman Paul Ryan referred to its “conclusive empirical evidence” when advocating swingeing public spending cuts in his 2013 budget proposal. On this side of the pond, UK finance minister George Osborne was adamant the research had “demonstrated convincingly” the case for austerity.