"Austerity Is Not The Answer"
Esteemed Senator Berger,
It may seem that
austerity is a solution to North Carolina's economic woes.
However, in the face of low-growth, austerity's
paradoxical effect is like snuffing kindling with wet
logs.
Here is a review of Europe's unhappy experience
with "economic anorexia."
Austerity Fails: European Nations See Debt Grow Despite Deep Spending Cuts
By Pat Garofalo
Jan 23, 2013
Since the onset of the financial crisis, European countries have attempted to deal with their economic malaise by implementing austerity packages, slashing government spending and laying off public workers. However, such measures have proved self-defeating, as the austerity measures blunted economic growth and caused Europe’s debt to actually grow:
The eurozone failed to reduce its government debt in the third quarter of last year, as meager growth offset efforts by several of the bloc’s 17 nations to improve their finances by cutting spending and raising taxes, according to official data released Wednesday.The countries’ total government debt relative to their annual economic output was barely changed at 90 percent of gross domestic product in the third quarter of 2012 compared with 89.9 percent for three months earlier, the EU’s statistics office Eurostat reported. It was up from 86.8 percent of GDP a year earlier.
Austerity has also, among other things, pushed Eurozone unemployment to a record high and threatened Great Britain with a triple-dip recession. Both the International Monetary Fund and the International Labor Organization have warned against further fiscal consolidation, saying that it would quash economic growth even more, thereby doing nothing to reduce debt loads. The National Institute for Economic and Social Research found that European debt loads will be higher, not lower, because of austerity.
***
Currently, North Carolina needs "uncommon sense" more than reflexive passion for chop-block austerity.
Thanks for your
attention.
Alan Archibald
225 West Margaret Lane
Hillsborough, NC 27278
Tel: 919-644-1364
*The Senate convenes at 7:00 tonight - The time is now to call Senator Berger's Office!*
Friends:
The Republican-Led General Assembly came to power promising jobs and a stronger economy. As we learned this week, this was not the case. Since the beginning of the 2013 General Assembly, Republicans have proposed to cut the corporate and income tax rate and to make up for the lost revenue by raising the sales tax. And that’s not all. Just this week the House Finance Committee passed HB 4 UI Fund Solvency & Program Changes (Unemployment Benefits Cut). This bill would:
Cut the maximum benefit amount by 1/3 to $350 per week. No state has ever made such a severe cut.
• Cut all benefits by changing to a formula no other state uses.
• Cut the maximum weeks of benefits from 26 weeks to a sliding scale of 12-20 weeks. Only two other states (Florida and Georgia) do this.
• Cut benefits for workers who lose their job because of health reasons or family reasons, something ½ the states allow.
In the Senate, the Republicans are pushing SB 4, which would block the expansion of Medicaid to poor families and individuals. This bill will also prevent the state from participating in the creation of health exchanges as allowed by the federal Affordable Care Act. We must act now. Call Speaker Tillis, Leader Berger, Governor McCrory and your local representative/senator. Let them know that we must take care of the least of these and not ignore them.
Speaker Thom Tillis: Phone: 919-733-345 email: Thom.Tillis@ncleg.net
Sen. Phil Berger, President Pro Tempore: e-mail: Phil.Berger@ncleg.net
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