By: Les Dunaway

The term austerity has been misused hundreds of times daily for months now! It annoyed me the first time, as calling a leg a tail always does.

If you call a tail a leg, how many legs has a dog? Five?

No, calling a tail a leg don't make it a leg.
Abraham Lincoln

It’s reached the point where I’ve got to talk about this latest foray into politically correct.

If you haven’t been reading this word, over and over and over and…, it’s being used to describe any action taken to drag the European social democracies back from the abyss their spending of money they don’t have has dug for them. It was adopted to make the structural changes necessary to save the economies of the European seem like an attack on the poor defenseless people. The same people who, for over 60 years, elected government after government on the basis of who promised them the most free stuff paid for by taxing the evil rich or corporations or …

David Malpass, in today’s Wall Street Journal Greece’s False Austerity, makes several good points:

• The conflict between growth and austerity is artificial and framed to favor bigger government. Growth comes from economic freedom within a framework of sound money, property rights and a rule of law that restrains government overreach. 
• Economics has often ignored the critical distinction between austerity for the government and government imposed austerity on the private sector. In the former, governments which are over-budget sell assets, restrain their hiring and limit their mission to essentials. That’s growth-oriented austerity.
• In the private-sector version of austerity, governments impose new taxes and mandates on the private sector while maintaining their own personnel, salaries and pensions. That’s the anti-growth version of austerity prevalent in Europe’s austerity programs.
• Many economic models, including the US Congress’s budget scoring system and Keynesian stimulus, ignore national debt levels and disregard whether spending decisions are made by the private sector or the government. This creates the absurd result that an economy in which the government spends and invests increasing amounts – even 100% of GDP – has the same projected growth rate as an economy where the government spends and taxes less. [emphasis mine]

I looked austerity up, online:

Austerity
noun
the trait of great self-denial (especially refraining from worldly pleasures)

I have several questions from that:

• How is it self-denial to lose what one was never entitled to?
• How is fiscal responsibility related to self-denial?
• How is it austerity when it’s imposed by creditors tired of your self-indulgence?
• Have whole countries of people become so mired in the entitlement mentality that they cannot, will not make the changes needed to preserve their countries?
• When the leaders of these countries cannot even say the words structural change, is there any hope?

My hope and belief is that America still has leaders with the intelligence to recognize and the cojones to implement the changes we need to get off the path down which the EU has stumbled. I’m sure that those leaders need our help, expressed as loudly and as often as possible. When those who want us on the path that Europe is sliding down begin to attack any good idea, the creators of those good ideas need to know that we have their back. And, just as important, those who who should be on the side of good ideas need to be reminded of  Senator Lugar, if they begin to get wobbly.

In the piece cited above, David Malpass ends with a summary that I pray what-leaders-there-are in Washington will take as a basic policy:

As the US struggles with tax reform, deficit reduction and the year-end fiscal cliff, it will be critical to distinguish between reforms that downsize government and reforms that downsize the private sector and put the dollar at risk. One approach points to growth, the other to Greece.