Home > Uncategorized > Graph of the day. Austerity (not!) kept the UK together

Graph of the day. Austerity (not!) kept the UK together

November 4, 2014 Leave a comment Go to comments

In the first quarter of 2014 the UK government deficit was 0,5% of GDP larger than in the fist quarter of 2013. Somewhat trivial, but it’s hard to call this ‘austerity’. In the second quarter, however, the deficit was a non-trivial 1,5% of GDP larger than one year earlier, despite a 4 to 5% growth rate of nominal GDP: austerity (not!). This sure does explain part of the economic upswing of the UK. This was, I guess, connected to the ardent wish to keep Scotland in the UK – can you imagine any British government which would not have pushed the expansionary pedal to the metal to keep the country together?

Nausterity

 

 

  1. Lyn Eynon
    November 5, 2014 at 7:08 am
    Reply

    Quite right that the UK deficit reduction has been less austere than the rhetoric implies and that has helped recovery, although I suspect this is a temporary boost as we approach next year’s election. Not sure how much Scotland had to do with it as Cameron did not wake up to the risk until the referendum was imminent.

  2. davetaylor1
    November 5, 2014 at 9:28 am
    Reply

    I took my little daughter to see the floods once, and the only way I could get her to step back from the water was to tell her to jump in. I have some slight hope, therefore, that Cameron (if not Osborne and co) knew what he was doing.

  3. larrykaz
    November 5, 2014 at 9:33 am
    Reply

    British economic growth shows that on-going deficits work | Bill Mitchell…
    Oct 1, 2014 … Another case of austerity madness combined with the mindless approach to …
    bilbo.economicoutlook.net/blog/?p=29135

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