<p>The division comes from the entities guiding these sets of policies.</p>

<p>The austerity program falls under <em>fiscal policy</em>, which is controlled by Parliament. Quantitative easing falls under <em>monetary policy</em>, which is controlled by the Bank of England.  The policies enacted by these two entities are not necessarily coordinated, and can sometimes work opposite each other's objective.</p>

CC BY-SA 3.0
2015-01-15T01:06:40.543Z
2015-01-15T04:32:33.960Z
2015-01-15T04:32:33.960Z
Bryce
<p>In 2010 the UK government simultaneously started an austerity program which cut public spending, taking money out of the economy, while enacting a quantitative easing program which injected hundreds of billions of pounds into the economy. </p>

<p>How can these two seemingly conflicting programs co-exist?</p>

CC BY-SA 3.0
2015-01-15T23:27:33.493Z
This question appears to be off topic because it is based on the (rather bizarre) misconception that fiscal policy directly affects the money supply.
Steven Landsburg
<macroeconomics><monetary-policy><keynesian-economics>
How can austerity and quantitative easing happen simultaneously?
Paul Higgs
# How can austerity and quantitative easing happen simultaneously?

(Asked by: username_0 on 2015-01-15)

In 2010 the UK government simultaneously started an austerity program which cut public spending, taking money out of the economy, while enacting a quantitative easing program which injected hundreds of billions of pounds into the economy.

How can these two seemingly conflicting programs co-exist?

**Tags:** macroeconomics, monetary-policy, keynesian-economics

> **Comments:**
> **username_1**: This question appears to be off topic because it is based on the (rather bizarre) misconception that fiscal policy directly affects the money supply.  

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## 1 answers

### Answer by username_2 on 2015-01-15. Score: 2

The division comes from the entities guiding these sets of policies.

The austerity program falls under *fiscal policy*, which is controlled by Parliament. Quantitative easing falls under *monetary policy*, which is controlled by the Bank of England. The policies enacted by these two entities are not necessarily coordinated, and can sometimes work opposite each other's objective.


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