Economic austerity or austerity refers to the política económica that tries to reduce the public spending and increase the taxes of a certain country. This economic policy tries to increase the levels of public collection through taxes and minimize the public spending that the State has before citizens.
The ultimate goal of this type of economic policy is to improve the public deficit by reducing it. Economic recessions and crises cause these types of measures to have more effect and greater popularity among governments that want to get out of suffocation. For this reason, these types of measures become a perfect salvation.
Like everything in life, there are positive and negative points about this type of economic policy. We are going to comment on the main ones.
Points in favor of economic austerity
These types of measures are carried out by governments trying to get out of the crisis reducing the debt they have contracted, with more restrictive political and economic measures.
These measures are intended to improve national accounts and avoid bankruptcy or bankruptcy, since part of public spending is dedicated to paying the debts that are owed. However, the reliability that the collection of taxes and reduction of public spending can help to improve or not the situation of the country. At times, it can even make the debt disappear and cause a public surplus.
Aspects against economic austerity
Economic austerity is a measure that not everyone likes. Those who are affected the most and are affected the most is citizens and companies, who see their rights reduced by the reduction of debt. In addition, the Welfare State is reduced or almost annulled by the little public spending that the government decides to carry out through the measures that it wants to carry out.
The state cuts have been a measure that has mainly affected health, education and infrastructure, fully affecting citizens and companies.