Compare that approach to the expansion-through-austerity policy being pursued nowadays by British Prime Minister David Cameron’s government (with Chancellor of the Exchequer George Osborne leading the cheering squad). The country’s real GDP has flat-lined, and the odds are high that British real GDP is headed down again.
Indeed, in less than a year, if current forecasts are correct, Britain’s Cameron-Osborne Depression will not merely be the worst depression in Britain since the Great Depression, but probably the worst depression in Britain…ever.
That is quite an accomplishment. As Phillip Inman of The Guardian recently put it: “[T]he UK’s plan for recovery from the financial crisis was based on a full-throttle recovery in 2012....[C]onsumer confidence, business investment, and general spending would converge to send the economy on a trajectory of above-average growth.”
It did not work: government ministers “have done what the right-wing economists told them to do and moved out of the way – the theory being that public-sector spending and investment was ‘crowding out’ the private sector.” Instead, as Inman says, “Spain is showing the way with its austerity-driven recession. Where the weak tread, we [in Britain] look keen to follow...”
The failure of expansionary austerity in Britain should give all of its advocates around the world reason to reflect on and rethink their policy calculations. Britain is a highly open economy with a flexible exchange rate and some room for further monetary easing. There is no risk or default premium baked into British interest rates to indicate that fear of political-economic chaos down the road is discouraging investment.
There is an argument – not necessarily true, but an argument nonetheless – that, while in office from 1997 to May 2010, the Labour governments of Tony Blair and Gordon Brown overshot long-term sustainable government spending as a share of GDP. Their actions stand in contrast to countries that reduced their debt-to-GDP levels in the 2000’s, and to the United States, where the problem was not excessive spending but insufficient taxation under the Bush administration.
Yet, if one takes this view seriously, Britain, with a ten-year nominal interest rate of less than 2.1% per year, should already be in a boom. If there was ever a place where expansionary austerity should work well – where private investment and exports should stand up as government purchases stood down, confirming its advocates’ view of the world – it is Britain today.
But Britain today is not that place. And if expansionary austerity is not working in Britain, how well can it possibly work in countries that are less open, that can’t use the exchange-rate channel to boost exports, and that lack the long-term confidence that investors and businesses have in Britain?
To be sure, if Clegg did this, his political career would probably be finished, and his party’s electoral prospects would be damaged for a long time to come. But Clegg’s political career and his party’s fortunes will be shaky for a long time to come in any case, given the economic hardship that Britain is enduring (and will continue to endure). At least defection from the ill-advised Conservative-Liberal coalition now would benefit his country.
Policymakers elsewhere in the world take note: starving yourself is not the road to health, and pushing unemployment higher is not a formula for market confidence.
J. Bradford DeLong, a former assistant secretary of the US
Treasury, is Professor of Economics at the University
of California
at Berkeley
and a research associate at the National Bureau for Economic Research.
J. Bradford
DeLong: 內維爾·張伯倫是對的
伯克利——在今人的記憶中，曾於1937~1940年任英國首相的內維爾·張伯倫是歐洲對納粹德國綏靖政策的化身，將歐洲引向二戰的始作俑者。但在那災難深重的十年之前，大蕭條剛開始沒多久的時候，也正是時任英國財政大臣的張伯倫實施了財政刺激政策，使得價格水平重回衰退前的軌道，英國經濟也得以迅速恢復到原先的水平。
與張伯倫當年的手段相比，如今戴維·卡梅倫政府所推行的“緊縮擴張”政策 [現任財政大臣喬治·奧斯本納（George
Osborne）是該政策最大的吹鼓手] 很可能使一直以來都保持平穩的英國GDP再次下跌。
事實上，如果目前的預測無誤的話，英國的卡梅倫-奧斯本衰退將不僅僅是自大蕭條以來該國所經歷的最嚴重衰退，甚至可能是有史以來最嚴重的一次。
這真是一項豐功偉績。正如《衛報》的菲利浦·因曼最近寫到的那樣：“英國的整個金融危機復蘇計劃都寄望於在2012年實現一場全速復蘇……消費者信心，商業投資和一般支出等因素會合力將經濟推到一個高於平常水平的增長軌道之上。”
但這一切卻沒能實現：因為政府大臣們“照右派經濟學家所說的去做並走上了邪路——而那些經濟學家的理論就是公共部門支出和投資‘擠壓’了私人部門。”但事實上，“當前的西班牙就是緊縮導致衰退的樣板，而我們（英國）卻似乎很想走上這條弱勢國家所選擇的道路。”
對於那些全球各地的擴張性緊縮政策鼓吹者來說，該政策在英國所遭遇的失敗就是一個足以令他們反省並重新思考其政策計算的理由。英國是一個高度開放，匯率靈活且擁有進一步貨幣擴張空間的經濟體。也沒有任何風險或者由違約費用所導致的英國利率顯示對未來政治-經濟混亂的恐懼將阻礙投資。
有一種說法——不一定是對的，但至少有此一說——認為於1997年到2010年5月的布萊爾以及戈登的工黨政府執政時期長期可持續政府支出佔GDP的比例過高。他們的行為與那些在2000年代減少債務相對於GDP水平的國家背道而馳，也跟美國不同，而美國的問題並不是過度的支出而是小布什政府的征稅不足。
但如果誰對這一說法信以為真的話，英國這個十年期名義利率低於每年2.1%的國家早該進入繁榮期了。如果真有一個擴張性緊縮能發揮其作用的地方——也是就是私人投資和出口能在政府支出下降時上升，符合那些鼓吹者的世界觀——那就該是英國。
但英國如今卻不是這番景象。而如果擴張性緊縮政策在英國都行不通，那麼在那些開放程度更低，無法利用匯率渠道來促進增長，並缺乏英國投資者和企業界那種長期信息的國家又如何能成功？
而作為英國副首相兼執政聯盟伙伴（自由民主黨）的領袖，尼克·克列格應該盡早結束這場鬧劇。他應該告訴伊麗莎白女王二世自己的黨派對政府缺乏信心，並謙虛地請求女王下令工黨領導人埃德·米利班德組建一個新政府。
可以確定的是，如果克列格真的這樣做了，他的政治生涯可能就此完結，而他所屬黨派的競選前景在未來一段時間都將相當黯淡。其實在英國目前所經歷（並將長期經歷）的經濟困難之下，克列格的政治生涯及其黨派的前途無論如何都將長期低迷。但至少把這個沒頭腦的保守黨-自由民主黨執政聯盟解散能對這個國家有所裨益。
世界其他地方的政策制定者們請注意：忍飢挨餓可不是通往健康之路，而推高失業率也不是個恢復市場信心的良方。
J. Bradford
DeLong，曾任美國財政部部長助理，現為加州大學伯克利分校經濟學教授，智庫機構“國家經濟研究局”研究員。