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Stop the Austerity Craze! Massive Budget Slashing Can Lead to Economic Disaster, Violence and Repression

The DC-Wall Street power circuit, with a big assist from the corporate media, is blindly pushing an agenda that could lead to massive social upheaval.

Now that the shock of the Gabrielle Giffords shooting is starting to wear off and the country is returning to its more familiar climate of insanity, we’re back to facing a far worse, far more serious, and far more violent threat than mere rampage shootings: Austerity.

The Washington-Wall Street power circuit has already decided for the rest of us that “austerity” will define the 2011 political agenda. Austerity is what the oligarch-sponsored Tea Party demanded, what the Republicans are promising to deliver now that they’re in control of drafting the budget in the House, and what the Obama administration is going to try to enact as part of its neo-Clinton triangulation strategy. And the DC pols have the total endorsement of the corporate media, which have been hammering home the same message for months now: Austerity is the answer to our problems — problems that were created by the same establishment which wants to make us scream in pain again.

The way this austerity debate has been framed in all the major media outlets, anyone pushing for austerity cuts and “pain” is automatically labeled “courageous”—which is an odd way of defining courage, since not a single rich politician or pundit pushing for "austerity" will actually suffer that pain, and most will profit from it. But that’s what counts as courage in our era.

Bush speechwriter-turned- Washington Post pundit Michael Gerson has been an early promoter of the courage-austerity complex. Here's Gerson writing about his old colleague, former Bush OMB director Mitch Daniels, now Indiana governor, whose first act upon taking oath was pawning the Indiana Turnpike to a multinational as fast as you can spell courageous: Daniels became a highly successful Indiana governor, combining a motorcycle-driving, pork-tenderloin-eating populism with courageous budget cutting, a solid record of job creation and a reputation for competence.

By this logic, if Mitch Daniels is the courageous one, then that means that the opposite of courage is us, the cowardly masses of lazy slobs, who need to be whipped into shape with a steady lashing of the “austerity” whip. We prove our unworthiness whenever we call for “Austerity for the rich,” which is of course the opposite of courage.

And while considering the implications of living in a country where politicians and pundits are allowed to call selling off juicy pieces of the state courageous acts, there's something even more troubling about it; what has happened in modern history after the austerity drive is finished: These measures almost always end in the worst worst-case-scenario imaginable: economic disaster, violence and repression.

Let’s start with the most catastrophic of all austerity programs in history—the one austerity program none of the Austerity Snake Oil peddlers want you to know about. It was the disastrous austerity program tested out in Germany way back in 1930, under Chancellor Heinrich Bruning, himself an austere centrist.

The Depression was just spreading around the globe, and Bruning, backed by Germany’s industry titans, believed Germany would only recover with a strong currency, which he tethered to the gold standard, and a balanced budget through brutal cuts in wages, pensions and unemployment benefits, and hikes in taxes and fees. Bruning learned austerity as a doctoral student at the London School of Economics -- which nurtured and promoted "free-market" whores like Friedrich von Hayek and the “Austrian School” that is still being piped out to us through major outlets like the editorial pages of the Wall Street Journal and the libertarian press.

Bruning applied the von Hayek medicine to Germany, and the resulting backlash was so intense he suspended parliamentary democracy and ruled by emergency decree, setting a fine example for the next guy who took power. After just two years of “austerity” measures, Germany’s economy had completely collapsed: unemployment doubled from 15 percent in 1930 to 30 percent in 1932, protests spread, and Bruning was finally forced out. Just two years of austerity, and Germany was willing to be ruled by anyone or anything except for the kinds of democratic politicians that administered “austerity” pain. In Germany's 1932 elections, the Nazis and the Communists came out on top — and by early 1933, with Hitler in charge, Germany’s fledgling democracy was shut down for good.

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