This Is Not the Age of Austerity

Austerity has become a household word. It’s been mentioned and repeated so many times that Merriam-Webster’s Dictionary honored the term as its word of the year in 2010 — that’s how many web searches were conducted on the “austerity”.

Fiscal austerity is simply a means by the government to control spending and increase revenue. Presumably, this is done by reducing the amount of money it borrows in order to cut the fiscal deficit, find new and fun ways to raise taxes, while simultaneously cutting government programs. However, this is usually done during tough economic times. Those most affected by unfavorable economic conditions will also be hit the hardest by the newer tax burden and cuts in goods and services.

IBD editorial:

When Republicans took control of the House in January, they pledged to make deep cuts in federal spending, and in April they succeeded in passing a bill advertised as cutting $38 billion from fiscal 2011′s budget. Then in August, they pushed for a deal to cut an additional $2.4 trillion over the next decade. …

But data released by the Treasury Department on Friday show that, so far, there haven’t been any spending cuts at all.

In fact, in the first nine months of this year, federal spending was $120 billion higher than in the same period in 2010, the data show. That’s an increase of almost 5%. And deficits during this time were $23.5 billion higher.

Power Line

Note the burst in federal spending in FY 2009; that was the ill-fated stimulus bill. In the two fiscal years since then, federal spending has resumed the inexorable climb that has been going on for decades. We are always hearing about budget cuts, but the reality is that government budgets are virtually never cut. Reallocated sometimes, but not cut.

It’s not my intent to give a lesson or to argue for or against. Besides, there’s no point in getting worked up about it. Our government has shown no inclination to consider austerity, either in whole or in parts.

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