The Irish haven’t in fact tried “austerity”

From today's FT:

The escalating cost of bailing out Anglo Irish Bank is set to balloon the deficit to at least 25 per cent of GDP this year, cancelling out the benefits of previous austerity budgets.

Comments

where is that quote in the linked article? can't find it, maybe they took it out? I thought the irish deficit was only set to reach ~20% (only...) this year

Running a high deficit in the aggregate is not austere. The so-called "austerity" is a matter of allocation of financing proceeds and not actual cutbacks in spending (contra the Krugman meme), which is the point Tyler is making.

What? The gov'ment didn't cause the problem, but the banks did!

And, Ireland has to undergo austerity to bail out the banks, the bank creditors and bondholders. No surprise. The austerity bandwagon was just a ruse to make the state budget available to private banks. Just think about those happy pensioners, schoolchildren, and the poor so generously giving to the Irish banks.

'Twas so generous of them.

Yeah, there's plenty of austerity, just not for the people who matter.

"but the 2011 deficit will be back to 10% of GDP. "

Only 10% of GDP? Now there's austerity! Every government has the right to run a deficit of at least 15% of GDP!

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