David Heald and Christopher Hood
- Published in print:
- 2014
- Published Online:
- May 2015
- ISBN:
- 9780197265734
- eISBN:
- 9780191771941
- Item type:
- chapter
- Publisher:
- British Academy
- DOI:
- 10.5871/bacad/9780197265734.003.0001
- Subject:
- Political Science, Political Economy
This chapter conceives ‘fiscal squeeze’ as political effort to correct the public finances by raising taxes or cutting spending (or both), distinguishing different types of squeeze. It poses three ...
More
This chapter conceives ‘fiscal squeeze’ as political effort to correct the public finances by raising taxes or cutting spending (or both), distinguishing different types of squeeze. It poses three questions about such squeezes, namely whether there is something special about the politics of austerity or retrenchment, whether fiscal squeeze presents credit-claiming opportunities or severe blame-avoidance challenges to elected governments, and how consequential the effects of fiscal squeezes are. It argues that to put fiscal squeezes into perspective we need to observe what else is happening in the relevant country and in the outside world, to examine what happened afterwards, and to compare fiscal squeezes with one another to see what, if any, common patterns they display. It introduces nine different cases of fiscal squeeze in democracies ranging from the early 1800s to the early 2000s. Each of those cases can be seen as puzzling or contested in some way.Less
This chapter conceives ‘fiscal squeeze’ as political effort to correct the public finances by raising taxes or cutting spending (or both), distinguishing different types of squeeze. It poses three questions about such squeezes, namely whether there is something special about the politics of austerity or retrenchment, whether fiscal squeeze presents credit-claiming opportunities or severe blame-avoidance challenges to elected governments, and how consequential the effects of fiscal squeezes are. It argues that to put fiscal squeezes into perspective we need to observe what else is happening in the relevant country and in the outside world, to examine what happened afterwards, and to compare fiscal squeezes with one another to see what, if any, common patterns they display. It introduces nine different cases of fiscal squeeze in democracies ranging from the early 1800s to the early 2000s. Each of those cases can be seen as puzzling or contested in some way.
Rozana Himaz and Christopher Hood
- Published in print:
- 2014
- Published Online:
- May 2015
- ISBN:
- 9780197265734
- eISBN:
- 9780191771941
- Item type:
- chapter
- Publisher:
- British Academy
- DOI:
- 10.5871/bacad/9780197265734.003.0002
- Subject:
- Political Science, Political Economy
This chapter offers a systematic quantitative comparison of the nine country cases examined in the book. It uses reported spending and tax data to compare the depth and duration of those squeezes, ...
More
This chapter offers a systematic quantitative comparison of the nine country cases examined in the book. It uses reported spending and tax data to compare the depth and duration of those squeezes, and to show how far depth and duration vary according to whether squeeze is measured by tax and spending in constant prices or relative to GDP, and whether squeeze is measured in terms of spending cuts or tax increases. It shows there is no common set of financial, economic or political preconditions for fiscal squeezes in the nine cases. It also looks at the aftermath of fiscal squeezes in electoral and other outcomes, showing that political incumbents often but not always experienced loss of vote share or loss of office. It also shows that (contrary to common claims about the impact of fiscal squeeze) constitutional or major institutional change only followed fiscal squeeze in two of the cases.Less
This chapter offers a systematic quantitative comparison of the nine country cases examined in the book. It uses reported spending and tax data to compare the depth and duration of those squeezes, and to show how far depth and duration vary according to whether squeeze is measured by tax and spending in constant prices or relative to GDP, and whether squeeze is measured in terms of spending cuts or tax increases. It shows there is no common set of financial, economic or political preconditions for fiscal squeezes in the nine cases. It also looks at the aftermath of fiscal squeezes in electoral and other outcomes, showing that political incumbents often but not always experienced loss of vote share or loss of office. It also shows that (contrary to common claims about the impact of fiscal squeeze) constitutional or major institutional change only followed fiscal squeeze in two of the cases.
David Heald, Rozana Himaz, and Christopher Hood
- Published in print:
- 2014
- Published Online:
- May 2015
- ISBN:
- 9780197265734
- eISBN:
- 9780191771941
- Item type:
- chapter
- Publisher:
- British Academy
- DOI:
- 10.5871/bacad/9780197265734.003.0012
- Subject:
- Political Science, Political Economy
This chapter examines what nine cases of fiscal squeeze in different democracies can reveal about the politics of austerity, combining overall quantitative comparisons with a set of qualitative ...
More
This chapter examines what nine cases of fiscal squeeze in different democracies can reveal about the politics of austerity, combining overall quantitative comparisons with a set of qualitative accounts of those nine cases. It argues that fiscal squeeze in democracies is not invariably prompted by economic force majeure, contrary to the view that public spending growth in democracies can only be checked by exogenous forces or constitutional entrenchment. It further argues that there is no standard set of economic and financial preconditions for fiscal adjustment or consolidation, and that while fiscal squeeze often presents blame-avoidance challenges for incumbents, such squeezes do not necessarily produce deep political crisis or political violence. Nor are they invariably marked by major political turning-points or political cross-dressing in the form of ‘Nixon goes to China’ moments. The chapter concludes by reflecting on what policymakers in the next set of fiscal squeezes can and cannot learn from comparative experience.Less
This chapter examines what nine cases of fiscal squeeze in different democracies can reveal about the politics of austerity, combining overall quantitative comparisons with a set of qualitative accounts of those nine cases. It argues that fiscal squeeze in democracies is not invariably prompted by economic force majeure, contrary to the view that public spending growth in democracies can only be checked by exogenous forces or constitutional entrenchment. It further argues that there is no standard set of economic and financial preconditions for fiscal adjustment or consolidation, and that while fiscal squeeze often presents blame-avoidance challenges for incumbents, such squeezes do not necessarily produce deep political crisis or political violence. Nor are they invariably marked by major political turning-points or political cross-dressing in the form of ‘Nixon goes to China’ moments. The chapter concludes by reflecting on what policymakers in the next set of fiscal squeezes can and cannot learn from comparative experience.
Christopher Hood, David Heald, and Rozana Himaz (eds)
- Published in print:
- 2014
- Published Online:
- May 2015
- ISBN:
- 9780197265734
- eISBN:
- 9780191771941
- Item type:
- book
- Publisher:
- British Academy
- DOI:
- 10.5871/bacad/9780197265734.001.0001
- Subject:
- Political Science, Political Economy
This book develops a framework for analysing the politics of ‘fiscal squeeze,’ defined as political effort to cut spending and increase taxes to correct the public finances—a theme which has ...
More
This book develops a framework for analysing the politics of ‘fiscal squeeze,’ defined as political effort to cut spending and increase taxes to correct the public finances—a theme which has dominated the politics of many of the world’s democracies in the 2010s. The book poses three questions about the politics of fiscal squeeze in democracies, namely what if anything is special about the politics of austerity or retrenchment, whether fiscal squeeze presents credit-claiming opportunities or severe blame-avoidance challenges to elected governments, and whether fiscal squeezes are highly consequential in their effects. To explore those questions, it examines nine cases of fiscal squeeze in democracies in different times and places, ranging from the early United States in the 1830s/40s (when half of the states then in the Union defaulted) to the squeeze following the 2001 Argentinian default and devaluation. The cases explored are sufficiently far back in time for an assessment of their consequences to be made and the analysis combines systematic quantitative comparison with in-depth qualitative study of each case by leading country experts. The analysis shows there is no single set of preconditions for fiscal squeeze and that the political consequences of such squeezes—for example, in who got political blame or credit and the longer-term effects on politics and government—were highly variable in these nine cases. The book argues that ‘how to do it’ approaches to fiscal squeeze in democracies, based on apparently successful cases, often fail to take into account profound differences in circumstances.Less
This book develops a framework for analysing the politics of ‘fiscal squeeze,’ defined as political effort to cut spending and increase taxes to correct the public finances—a theme which has dominated the politics of many of the world’s democracies in the 2010s. The book poses three questions about the politics of fiscal squeeze in democracies, namely what if anything is special about the politics of austerity or retrenchment, whether fiscal squeeze presents credit-claiming opportunities or severe blame-avoidance challenges to elected governments, and whether fiscal squeezes are highly consequential in their effects. To explore those questions, it examines nine cases of fiscal squeeze in democracies in different times and places, ranging from the early United States in the 1830s/40s (when half of the states then in the Union defaulted) to the squeeze following the 2001 Argentinian default and devaluation. The cases explored are sufficiently far back in time for an assessment of their consequences to be made and the analysis combines systematic quantitative comparison with in-depth qualitative study of each case by leading country experts. The analysis shows there is no single set of preconditions for fiscal squeeze and that the political consequences of such squeezes—for example, in who got political blame or credit and the longer-term effects on politics and government—were highly variable in these nine cases. The book argues that ‘how to do it’ approaches to fiscal squeeze in democracies, based on apparently successful cases, often fail to take into account profound differences in circumstances.
