Tuesday, November 22, 2011

Austrian Socialist Chancellor proposes Herbert Hooverish idea for the country's Constitution

Austrian Chancellor Werner Faymann is head of the Austrian Social Democratic Party (SPÖ) and head of government in a Grand Coalition with the conservative, Christian Democratic People's Party (ÖVP).

Now that Austria is coming under pressure from the bond speculators as part of the collapse of the euro currency, Faymann is proposing a foolish, Herbert Hooverish idea of writing a maximum debt limit into the Austrian Constitution. This is one more symptom of the kind of corruption of policy and economic thinking that the dominance of neoliberal economic thinking has produced. Writing a particular economic doctrine of this specificity into the national constitution is just a bad idea, like the concept of a balanced budget to the US Constitution. It could lock Austria into overly rigid policies in a future (or even not-so-future) economic crisis. It could be an powerful temptation to the kind of disguising the actual level of debt that both Greece and Italy did, both with significant help from Goldman Sachs.

So far, Faymann isn't proposing ruinous cuts to the budget. Austria's current employment rate is high. And, fortunately, some in both the SPÖ and the ÖVP are dubious about this proposal. Hopefully dubious enough that it fails.

This is a video in German of him defending his proposal, Bundeskanzler Werner Faymann zur Schuldenbremse YouTube date 22.11.2011.

I commented on his YouTube and Facebook message, "Es wäre einfach töricht, solche eine spezifische ökonomische Doktrin in die Verfassung zu verankern!" (It would be simply foolish to anchor such a specific economic doctrine in the Constitution!)

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