Are Britain and USA Self Inflicting Financial Misery

October 22 00:00 2011

New York, October 22, 2011 ( – If the proposals of Republican Ron Paul are to be believed, the USA may well be on its path to inflicting the same financial misery on itself that Britain has already done.  Britain is now battling with rising unemployment, rising inflation and stifled economic growth. Most of this can be attributed to the drastic cuts in government spending brought about by the self-inflicted austerity measures by the David Cameron lead government.

The proposal by Ron Paul relies on extensive spending cuts. The Federal government will suddenly cut its spending by as much as $1 trillion. This will lead to a lot of government workers being unemployed. Along with the fact that their purchasing power will now be off the market, it also spreads a climate of fear and creates a crisis of confidence.

The general population expecting even more tax cuts, reduces its spending and actually brings about a depression. If you add the policy of quantitative easing and printing more money, you see why Britain has come where it has.

Economists agree that the governments across the world indulge in wasteful spending. However, this spending must be cut down step by step. Anything radical may prove counterproductive.