The Problem with Austerity

Should supporters of liberty favor Austerity? What is Austerity? Wikipedia says:

In economics, austerity refers to a policy of deficit-cutting by lowering spending via a reduction in the amount of benefits and public services provided... and are sometimes coupled with increases in taxes to demonstrate long-term fiscal solvency to creditors.

In other words, austerity is a policy of spending cuts and tax increases, which results in cutting government deficits/debts. Clearly, the tax raising half is not something libertarians support. Because good and bad are paired together in this word, I don't consider myself a supporter of "austerity", and neither should you.

Here are Robert Wenzel's comments on this subject:

From my perspective, an austerian is someone who wants to insure that sovereign debt is paid off by seeing to it that taxes are raised near the breaking point and that "social services" are cut. This is what is going on in eurozone countries, such as, Greece and Spain.

NYT reports on the Greek austerity steps taken in November 2012:

The measures — including sharp cuts to pensions, salaries and social services, as well as tax increases and increases in the retirement age to 67 from 65.

In July 2012, ABC News reported on austerity measures in Spain:

 Spain announced a 65 billion euro ($79.85 billion) austerity package that includes tax hikes and spending cuts on Wednesday...

Now, I am all for cutting government spending and the shrinking of government, but I am not in favor of increasing taxes---especially given the money goes into the Greek treasury to be then be immediately paid out to banksters in the form of payments on Greek debt. Thus, I would never call myself an austerian. In my view, governments that have over-spent should declare bankruptcy, which would result in the pain being placed on those who propped up the government by buying government debt---as opposed to the people of a country, who had little to do with these crony deals.

There you have it. Libertarians oppose austerity. Now we can move on to the real issue cutting government spending. This happens to solve the serious debt crisis we face, too.