For the austerity crowd..

One for Randy Bentwick and Tony Abbott from a notoriously socialist magazine:

The BIS’s sermon is not holy writ. Its call in effect for more austerity – governments must “redouble their efforts” to ensure fiscal sustainability - seems quixotic given the damage that overzealous fiscal tightening did in southern Europe over the past couple of years. Yes, supply-side reforms are needed, but it is unrealistic to imagine that they will reap quick dividends. The “paradox of policy”, as Sir Mervyn King, the outgoing governor of the Bank of England, stressed again on June 19th is that monetary conditions have had to be extraordinarily loose since the financial crisis in order to encourage spending even though that is the opposite of what is needed in the longer-term in Britain, which is to raise national saving.

H/T: Lowy Interpreter