Over the weekend, an op-ed authored by one of 2012 GOP presidential nominee Mitt Romney’s economic advisers appeared in a German newspaper. In the piece, Glenn Hubbard criticized the Obama administration’s approach to Europe’s ongoing economic woes, instead calling for the adoption of more austerity:
“Unfortunately, the advice of the U.S. government regarding solutions to the crisis is misleading. For Europe and especially for Germany,” Mr. Hubbard wrote, according to a translation of his article from the Handelsblatt Web site.
He opposed what he described as the Obama administration’s efforts “to persuade Germany to stand up financially weak governments and banks in the euro zone so that the Greek crisis would not spread to other states.” [...]
Mr. Hubbard proposed a classic conservative pro-austerity, anti-Keynesian approach, arguing that cutting government spending will restore public confidence, encourage growth and avert future tax increases.
“Long-term confidence in solid government financing shores up growth and enables the same scope for short-term transitional assistance,” he said.
Aside from the fact that Hubbard took out an op-ed in a foreign paper in which to blast the President, explicitly taking politics beyond “the water’s edge,” he is advocating for a doubling down on austerity that has simply made Europe’s economic situation worse. As this chart shows, austerity in Europe goes hand-in-hand with a contracting economy:
According to the International Monetary Fund, “Income and employment don’t fully recover even five years after the austerity program is enacted.” Yet that’s exactly the prescription that Hubbard and the Romney camp have in mind for both Europe and the U.S.