People attend a demonstration organized by CCOO and UGT Union workers in Madrid on June 16 against austerity policies and record high unemployment, urging Prime Minister Mariano Rajoy to focus on creating jobs to help pull the country out of recession. - AFP
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”.
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