The Economic ‘A-Bomb’

I was recently talking with some friends about the economic headlines streaming out of Europe.  Since my friends aren’t really followers of economic and political trends, there was a sense of puzzlement when the word “austerity” came up.

Their reaction, “What does that mean, exactly?”

Interestingly, the puzzling looks continue to crop up more and more when I mention “austerity” to family, friends and others.  And given the unprecedented prosperity of our country over the last 25-plus years, it’s hardly surprising.


Here’s an excerpt from its press release on Dec. 20, 2010 …According to Merriam-Webster, austerity means “enforced or extreme economy.” And in 2010, austerity was Merriam-Webster’s No. 1 pick for Word of the Year.

This profile of America’s mood and interests is determined by the volume of user lookups at Merriam-Webster.com in response to current events and conditions.                

… Lookups for austerity peaked dramatically several times throughout the year, as people’s attention was drawn to global economic conditions and the debt crises in Europe, but lookups also remained strong throughout the year, reflecting widespread use of the word in many contexts. 

Austerity clearly resonates with many people,” said Peter Sokolowski, Editor at Large at Merriam-Webster, who monitors online dictionary searches. “We often hear it used in the context of government measures, but we also apply it to our own personal finances and what is sometimes called the new normal.”

It would seem that Merriam-Webster’s Word of the Year reflected a significant shift in popular economic sentiment.  And in 2010, “austerity” was still in the top 10 at No. 5.  From these results, it looks like the word austerity is here to stay —especially in light of growing economic issues around the world.

Even with the increased identification with the word, do we really understand what austerity means?   Sure, we can look it up in a dictionary and intellectually infer its meaning.  But, in all honesty, I don’t think we have a clue what it REALLY means.

In other words, I’m of the mind that real meaning comes from experience, not just reading a definition.

Take for instance the noun “broken heart.” Dictionary.com defines “broken heart” as despair, disillusionment or devastating sorrow … especially from disappointment in love. When I read this definition, I can intellectually understand it.  But, I would argue it’s only when a “broken heart” is experienced that the full power of its meaning comes to bear.

It’s the actual experience of the death of a loved one, a devastating breakup or a divorce that causes us to truly understand the meaning of the word.  And while the illustration isn’t meant to be grim, it does make a point.

Austerity must be experienced to truly understand it.  I know I certainly don’t have an understanding of it.  How could I?  I was born in the most-prosperous nation of the 20th and 21st centuries (at least so far). It’s hard to even imagine what austerity would look like in the United States — as it completely flies in the face of the American dream.

But in times of great economic stress, austerity becomes very real. And what started as austere measures in Greece, Portugal, Italy and Spain, has now moved throughout Europe. And the fallout has only begun.

Recently Greece’s parliament was ousted, and now the country is on the verge of leaving the euro — and in turn the European Union.  Even bookies aren’t willing to take bets against Greece leaving the euro zone anymore!

And then there’s France.  Its newly elected president won his seat by campaigning against Nicolas Sarkozy’s austerity measures — measures instituted in cooperation with Germany.   But now even Germany is feeling the fallout from the austerity bomb.

German Chancellor Angela Merkel’s party has just suffered the worst defeat by any political party since the end of World War II.  And it seems like the backlash on austerity is just getting started.

So what does this show us?  It shows us how resistant human nature is to an “enforced or extreme economy.”  And after so many years of prosperity, it’s hard to imagine otherwise.

But, if we don’t start taking responsibility and enforce our own personal austerity, there will come a day when austerity will be forced upon us — and I can only imagine the backlash when that day finally arrives.

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nicholasbrack

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