Fears that the United Kingdom would fall into a triple-dip recession eased today, as the country avoided another quarter of economic contraction. GDP data confirmed that the country’s economy did in fact grow, if very slowly, at the beginning of this year:

During the first quarter of this year the country recorded an increase of three-tenths of a percent in gross domestic product, compared with the previous three-month period when it contracted by a similar amount, the Office for National Statistics said. Gross domestic product had been broadly flat over the last 18 months, the agency added.

The growth was driven in large part by an increase in output form the service sector, which grew by 0.6 percent, and from mining and quarrying, which increased by 3.2 percent. These increases were offset by a 2.5 percent decline in construction.

But the jump in growth was also aided by a slight change in policy focus away from deficit reduction. As the country’s leaders have slowed the drive toward austerity, the public sector began to grow instead of shrink. In the first quarter of the year, that sector grew by 0.5 percent, compared to a 0.9 contraction the quarter before, adding 0.1 percent to overall GDP growth.

This news contrasts sharply with figures out of Spain today, a country still struggling with the demand for austerity. The country continues to experience a recession, now for seven consecutive quarters. Its unemployment figure has climbed above 27 percent, a number it hasn’t experienced since 1976, the year its dictator Francisco Franco died. The public sector in Spain has increased firings in education and health to reduce deficits, causing employment in those sectors to fall to 2.85 million from 2.92 million at the end of last year. Private sector employment also fell from 13.9 million to 13.6 million.

Spain’s prime minister is looking to convince investors and other European Union countries to ease its deficit targets next month. He may find a friendly ear, as a top EU official recently indicated that he’s in favor of shifting the focus away from austerity and giving countries more time to reduce their deficits, and the EU’s economic and monetary affairs commissioner has voiced a similar opinion.

There was a period when the U.S. looked like it might avoid the mistakes of some of its European counterparts, who rushed to austerity and have found themselves saddled with stagnant growth. But the U.S. has gotten into the austerity game, most recently with the implementation of sequestration’s across-the-board spending cuts.

And just like its austere European neighbors, the U.K. in particular, it’s now getting a warning from the International Monetary Fund (IMF). In its latest report, the biannual World Economic Outlook, the New York Times reports that the organization had some stern words for those who think cutting government spending in the middle of a sluggish recovery is a good idea:

The fund lowered its estimate of United States growth this year to 1.9 percent, down 0.2 percentage point from its January forecast. While Washington had avoided falling over the “fiscal cliff,” the I.M.F. said that the United States had proved too aggressive in carrying out budget cuts, given its still-sluggish rates of growth and high unemployment levels. It said it anticipated that the across-the-board $85 billion in budget cuts known as sequestration would push down growth levels this year and beyond.

“The growth figure for the United States for 2013 may not seem very high, and indeed it is insufficient to make a large dent in the still-high unemployment rate,” Olivier Blanchard, the fund’s chief economist, said in the report. “But it will be achieved in the face of a very strong, indeed overly strong, fiscal consolidation of about 1.8 percent of G.D.P. Underlying private demand is actually strong, spurred in part by the anticipation of low policy rates under the Federal Reserve’s ‘forward guidance’ and by pent-up demand for housing and durables.”

The fund also lowered its projection of global growth to about 3.3 percent this year, a 0.2 percentage point reduction. And it didn’t just dole out harsh words for the U.S.: It lowered its forecasts for U.K. growth by 0.3 percentage points for this year and next, citing slashed spending.

Sequestration is already hurting the U.S. economy, but it’s not the only austerity measure that’s causing pain. Government spending overall has been lower during Obama’s administration than any point since the Eisenhower era. This is at a time of miserably high unemployment and incredibly low interest rates on U.S. borrowing. The U.S. could instead be spending money to rebuild crumbling infrastructure and put people back to work.

The United Kingdom’s breathless pursuit of austerity under Prime Minister David Cameron was aimed sparking economic growth and reducing deficits. Three years after the conservative government began its deficit reduction efforts, though, it has failed to do both. Britain is now on the brink of its third recession in four years and its economy is still smaller than it was when the Great Recession began.

Persistently high unemployment and that lack of economic growth — caused by fiscal contraction — have left the UK far short of its deficit reduction goals, as this chart from the Wall Street Journal shows:

In 2010, Cameron and finance minister George Osborne projected that their austerity package would by now have reduced deficits from 4.8 percent of the economy to just 1.9 percent. At the beginning of 2013, the deficit stood at 4.3 percent. Still, Osborne and Cameron remain committed to austerity, with Osborne telling the BBC last week, “You can’t get out of debt crisis by borrowing more and more.” But Britain doesn’t have a debt crisis — its borrowing costs are at historic lows. It has an unemployment and growth crisis that a growing number of economists are begging the conservative government to address.

That should be a lesson to lawmakers in the United States, which emerged from the Great Recession in better shape than its friends across the Atlantic because it chose to stimulate the economy instead of cutting spending. Congress is committed now to a similar path of deficit reduction, even though countries that have tried it have entered an austerity death spiral — as they attempt to reduce deficits, they instead reduce growth and inhibit their ability to reduce deficits. The U.S., like Britain, is nowhere near a debt crisis. Still, lawmakers are insistent on cutting spending, even though unemployment is still high, spending has plateaued, and fiscal contraction has already hampered America’s tepid economic recovery.

British Prime Minister David Cameron will use a speech Thursday to reiterate his commitment to the austerity policies that have hampered the nation’s economic recovery since the Great Recession. Great Britain is on the brink of an unprecedented triple-dip recession, but Cameron and United Kingdom finance chief George Osborne have pledged to continue deficit reduction efforts.

Turning away from austerity now, Cameron will say, would send Britain “back into the abyss,” Reuters reports:

However, Cameron will tell his audience he has cut the country’s deficit by a quarter, interest rates are at a record low, exports are reviving, the number of people on welfare has fallen, and there are more people in work “than ever before in our history”.

“Of course, these signs of progress are just the beginning of a long hard road to a better Britain,” he will say.

Britain’s deficit has fallen, but it has done so far more slowly than Osborne and Cameron projected when they began austerity three years ago. In 2010, the British government projected that austerity would reduce the deficit from 4.8 percent of the economy to just 1.9 percent by now. Anemic economic growth and a second recession brought on by those policies, however, have left the deficit at 4.3 percent. The country is now one quarter of contraction away from its third recession in four years.

Austerity has plagued the European Union, of which Britain is a member, since the recession, forcing unemployment to record highs. Britain, however, is not a member of the European currency union and maintains its own central bank, making the conservative government’s continued adherence to deficit reduction all the more confounding. The same could be said of the United States, which is now focused almost solely on deficit reduction even as unemployment remains high, the recovery remains tepid, and evidence exists that the stimulative policies it originally pursued put it on a faster pace of recovery than Europe has experienced.

There is no evidence that a financial transactions tax, if instituted by the world’s largest financial centers at a modest rate, would have a negative impact on economic growth, according to Christopher Leslie, a member of the British Parliament. That such a tax would limit growth and investment is a common claim of its detractors, but the effect would actually be “quite the opposite” if instituted smartly, Leslie said after an event about the institution of a transactions tax at the Center for American Progress:

LESLIE: I don’t see any evidence that there would be a negative effect on economic growth. In fact, quite the opposite. I think if you did have a global financial transactions tax where all of the global financial centers were involved and it was also set at a rate that is pretty modest, it wasn’t going to have a distorting negative consequence, then you could raise revenues that would actually help promote growth and invest in job creation. And I think ultimately that’s one of the main arguments in favor of a financial transactions tax.

Watch it:

The United Kingdom already taxes stock, equity, and bond trades at a small rate, but it does not tax derivatives and swaps. Leslie said that the British Labour Party, of which he is a member, is interested in expanding the tax to derivatives and swaps but only if the United States does so as well. Eleven European countries announced plans to institute a financial transactions tax in January.

A plan introduced in Congress by Sen. Tom Harkin (D-IA) and Rep. Peter DeFazio (D-OR) would tax derivatives, stocks, and bond trades at a 0.03 percent rate, raising roughly $350 billion over the next decade. A plan outlined by the Center for American Progress’ Adam Hersh and Jennifer Erickson today would raise $50 billion a year through similarly modest rates. The tax would also add stability to financial markets while promoting investment that is better for growth and the economy, Hersh and Erickson argued.

Such a tax has been supported by business and financial leaders, including a high-frequency trading pioneer who has admitted that such trading, which would be greatly limited by a transactions tax, has “absolutely no social value.”

Last week, the United Kingdom received its first ever credit downgrade, as continued austerity has dragged down the country’s economic growth. Britain’s conservative government, however, is forging ahead. Finance Minister George Osborne yesterday called for the UK to “stick to its course.”

The UK, though, is a prime example for why austerity should be avoided in a weak economy. As this chart from Reuters’ shows, the U.S., which embraced stimulus after the 2008 financial crisis, is in much better shape than the European countries that went for austerity:

As this chart shows, the UK has not at all lived up to the projections for economic growth that were made in 2010:

Austerity has actually had the opposite of its intended effect in the UK, killing growth while not bringing down debt. And that’s held true across Europe, as this chart from economists Paul De Grauwe and Yuemei Ji shows: