SINCE 2008, policy debate continues to be centred on the correct mix between austerity and growth, and the need for fiscal sustainability or what economists call budgetary consolidation – i.e. measures to ensure that government budgets are balanced over time so that the servicing of rising debts is sustainable, without passing on too great a burden to future generations.
The focus of public policy is now directed at the pace of fiscal retrenchment – i.e. how best to bring down deficits and debt to provide for “more growth and less austerity” according to French President F. Hollande, in order to provide sufficient leg-room to create more jobs and ease human misery. In today’s circumstance, it is proven that nations “can’t cut and grow”.