Austerity, as a response in 2008, to what threatened to be the worst recession for decades, was the very worst step that could have been taken.
Since the “haves” tend to have louder voices and more influence than the “have nots”, it is often the interests of the former that prevail when economic policy is formulated.
The great economist, John Maynard Keynes, had shown in the Great Depression that the only cure was to spend more, not less, that a depression or recession occurred because there was not enough demand (or, in other words, spending power) and that the proper remedy was to inject more money into an economy that was about to close up shop altogether.
It is only now, after nearly a decade or more of such policies, that a consensus has begun to emerge, supported by agencies like the Word Bank and the IMF, that austerity was a mistake, and had done much unnecessary economic and social damage.
. . . Bryan Gould