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U.K. embraces 'age of austerity'
Thursday - 10/21/2010, 1:55pm EDT
The average cuts to government departments will be 19% over the next four years, less than the 25 percent originally projected, The Wall Street Journal reports.
The U.K. is joining other large European countries -- including France, Germany and Spain -- that have reined in spending. President Obama has warned Europe against aggressive cuts for fear of returning to another recession. So far, Europe has ignored the warning, the Journal reports.
There's one area the U.K. has not cut -- funding to its special forces, which are "much-valued" by the American, according to The Economist. Overall, there will be "pain all around, but nothing fatal" to the U.K. military, Cameron said.
Lessons for the U.S.?
The U.S. may find some lessons in the U.K.'s embrace of austerity, according to a blog in the Economist, The U.K. spending cuts are only an announcement now, but with the left and right working together, the cuts are expected to pass the Parliament. Such legislative decisiveness is unlikely in the Congress, where there is "no incentive for Republicans to favour increased taxes or for Democrats to cut spending."
How Europe has tackled budget deficits also points to the importance of medium-range planning -- not just solutions for the short-term. For example, raising the retirement age won't have an immediate impact on the economy, but shows governments are trying to solve longer-term problems, according to the blog.
This story is part of our daily DorobekINSIDER Must Reads. Be sure to check out the full list of stories.