Not really. Do you call Reagan or Bush Jr a fiscal conservative? I don't. They both spent like drunken sailors...on the military and on tax cuts. Those are both deficit inducing policies.
Bush Senior and Clinton were really the only post-Reagan fiscal conservatives we've had as President. Bush Sr. raised taxes. Clinton did so again and he also reduced the welfare state.
Here's the deal. Austerity, or deficit reduction as I call it, that comes too fast, without a concommitant reduction in UNpayable debt, is a serious policy mistake. In Europe, they are making that mistake. Here in the US, we don't really have meaningful austerity, running a $1.4 trillion deficit per annum, nor have we written down the bad debt or repudiated any of the other UNpayable debts. Most importantly, we don't have a long term credible plan for deficit reduction and we're engaging in wanton and long lived QE and ZIRP. So we're not enacting my preferred policies here either.
Here's what overly fast deficit reduction (austerity) without debt reduction looks like:
U.K. may have slipped into a third recession
money.cnn.com
LONDON (CNNMoney)
The coldest March in 50 years may have tipped the ailing U.K. economy into a third recession since the financial crisis, a result that will increase the pressure on the government to relax its policy of austerity.Most economists expect the world's sixth-largest economy to narrowly avoid a second consecutive quarter of contraction when the first estimate of first-quarter output is released on Thursday. But the chances of a surprise are high.
The U.K.'s gross domestic product fell by 0.3% in the final quarter of 2012. A triple-dip recession would be unprecedented, and pile pressure on finance minister George Osborne to spread the pain of government spending cuts over a longer period of time.
UBS economist Amit Kara said he expected U.K. GDP to show zero growth, but cautioned that the cold weather could spring a shock and send the economy into reverse again.
"There are large risks to this forecast because of the unusually cold weather in March, and if we are wrong, and the UK economy does slip into recession once again, the triple dip will have become reality," he wrote in a research note.
A recovery in the dominant services sector was likely to have been canceled out by a "weather-related" collapse in construction, noted Nomura's UK economist Philip Rush, who also expects no growth in the quarter.
Retail sales were also weaker than expected in March, falling 0.7% on the previous month as British consumers, already squeezed by falling real incomes, stayed at home during the unusually cold spell.
The U.K. economy contracted for five consecutive quarters from the second quarter of 2008, and was back in recession for nine months in late 2011 and early 2012 when the eurozone debt crisis was raging.
The International Monetary Fund cut its forecast for U.K. growth in 2013 by 0.3% last week citing depressed demand, and said the government should think about taking a more flexible approach to cutting the budget deficit. On Friday, Fitch Ratings downgraded U.K. debt to 'AA+' from 'AAA', citing the impact of weak growth on debt and deficit levels.
Finance Minister George Osborne has stuck resolutely to the path of austerity, arguing that a policy of fiscal discipline and cheap central bank money will ultimately bear fruit.
A new recession would also raise the chances of further stimulus from the Bank of England, which has held interest rates at a record low of 0.5% since March 2009 and bought £375 billion of government bonds.
Governor Mervyn King and two fellow members of the Bank of England's monetary policy committee were outvoted again this month when they argued in favour of extending the bond purchases by a further £25 billion. The bank last added to its bond-buying program in July 2012. |
