Northern Ireland Is Building a Fake Town With Government Money
There are no austerians in a foxhole. Or in a city about to host an international confab.
Austerity has failed everywhere it's been tried, not least in Northern Ireland. Budget cuts at home have hit domestic demand just as budget cuts to the south have hit foreign demand. (Whether it was 2010 or 2011 or 2012 or 2013, Very Serious People were convinced, just convinced that the Celtic tiger had reinvented itself as the austerity tiger -- just give it a few more months! -- and every time they have been wrong). On either side of the Emerald Isle, deficit-cutting hasn't been a path to prosperity, except of the Potemkin variety.
Just look at Fermanagh. That's the Northern Irish county where the G8 is set to meet in June -- and where the economy isn't quite up to the image of "austerity success story." You see, there are shuttered storefronts all over the place, and that's no good. After all, you wouldn't want British Chancellor of the Exchequer George Osborne to talk up fiscal rectitude against a backdrop of bankrupt businesses. (Not that things are any better in the rest of the United Kingdom). But what is to be done? Well, how about just pretending everything is fine? That's basically what policymakers have been doing since 2010 anyway -- and it's what the Northern Irish government decided to do too. It's put up sham businesses across Fermanagh, because, hey, that worked for the Russians, right?
From the Irish Times:
The butcher's business has been replaced by a picture of a butcher's business. Across the road is a similar tale. A small business premises has been made to look like an office supplies store. It used to be a pharmacy, now relocated on the village main street. Elsewhere in Fermanagh, billboard-sized pictures of the gorgeous scenery have been located to mask the occasional stark and abandoned building site or other eyesore.
Potemkin prosperity is real. (Okay, it's fake, but you get the point). Of course, this leaves one little question: how did they pay for all these phony businesses? Again from the Irish Times:
All is paid for by so-called dereliction funding. About £300,000 was made available by the Department of the Environment and the Department for Social Development.... The short-term beneficiaries were local builders and painters who were called in for the spruce-up.
In other words, the government has used Keynesianism to try to cover up austerity's failure. Now, paying people to disguise vacant storefronts as vibrant ones is probably the worst stimulus ever, but it's better than none at all. And maybe, just maybe, it will help them realize they can pay people to do actually useful things too. You know, make the public investments that lead to genuine prosperity, not just a simulacrum of it.
Now, this is all a bit unfair to Northern Ireland. A real Potemkin village is embarrassing enough, but an intellectual one is worse -- one like the global austerity movement. Indeed, study after study supposedly showing that cutting deficits now would be expansionary either now or later has fallen apart after a few seconds of scrutiny. Austerity is a policy in search of a justification that has been faked over and over, with disastrous results.
It shouldn't surprise us that barren ideas lead to barren cities. Nothing can hide either now.
This post originally appeared on The Atlantic.