Debtors’ Prison: The Politics of Austerity Versus Possibility

Kuttner (The Squandering of America), cofounder and co-editor of the American Prospect, pulls no punches in his latest full-throated defense of Keynesian economics and repudiation of the modern neoliberal system. Kuttner argues that rather than helping countries live within their means, austerity hampers economic growth and prevents recovery. Alternately rousing and oversaturated with statistics, the author nevertheless makes a convincing case that fiscal policy has been hijacked by the vested interests of international finance and the moneyed classes. Every economic crisis over the past several decades has sparked the same two-pronged response of prodigal bailouts of multinational investment banks and crippling strictures on the public sector. These strategies are enforced by elites with no democratic accountability and dangerously little local knowledge. For example, in their negotiations with Greece, the E.U. and the E.C.B. have demanded that the majority of Greek airports be abruptly sold off, a strategy that may raise several million dollars but would create massive social disturbances. When elected Greek officials agree to absurd conditions like these, they are of course voted out of office, while the jobs of the bureaucrats who came up with them remain secure. Kuttner’s deft overview of economic history—most notably his coverage of the Marshall Plan—demonstrates that economic stimulus can be very effective at ending recessions. Agent: Amanda Urban, ICM. (May)