Austerity, local government, stimulus spending, social welfare services, social policy


Austerity policies have been instituted in countries around the world attempting to address the fallout from the global economic crisis beginning in 2008 and still lingering through today. While the literature debates the economic impact of these policies, limited attention has been given to the effects of austerity at the local governmental level. It is posited that at the local government level, the effects of austerity policies are most noticeable and detrimental. States and local municipalities are “switching roles” with the federal government (Davidson, 2013, p. 1). They are providing jobs and social welfare services in the gap left by the departure of the federal government from a broad social welfare delivery perspective. The ideological rationale associated with state budgets being balanced through austerity-like reductions in revenue sharing and the reducing the social safety net will be highlighted. In the U.S., the majority of those states which implemented drastic and sometimes draconian budget reductions have been under majority Republican legislatures and governorships. Characteristics of austerity policies and the modern welfare-state are discussed in relationship to the reduction in public investment, particularly in government non-education employment through discretionary spending. The results of austerity policies on funding for social welfare services and public employment will be illustrated.

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