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You might have thought European austerity – that proven economic growth killer – was dead and buried. You might have thought wrong. It is alive and well in Britain and if the Conservatives win the election, they will unleash one of the biggest exercises in state shrinking that the continent has ever seen.

To eliminate the budget deficit and bring down debt, George Osborne, Chancellor of the Exchequer, is planning spending cuts worth about £30-billion ($55-billion) over the next few years, of which £12-billion would be saved from the welfare budget. The Labour Party, led by Ed Miliband, has also been seduced by fiscal consolidation – spending cuts to you and me. He would just do it more slowly than the Conservatives and couple it with tax hikes on the wealthy. The Conservatives have promised no tax increases whatsoever.

So British austerity is coming, no matter who wins the May 7 election – the polls put the Conservatives and Labour neck and neck, with a coalition government likely. Why more austerity and why now?

Austerity has a bad name in Europe, for good reason. Slathering spending cuts and tax hikes onto countries that fell into deep recession after the 2008 financial crisis only made their recessions worse. Exhibit A is Greece, a wreck of an economy that may yet have to wave goodbye to the euro zone for fear that the proposed trade – another international bailout in exchange for more austerity – will doom it to another decade of misery. Italy, the euro zone's third-largest economy, seems perennially locked into mild recession or anemic growth, partly because of austerity. Its jobless rate, now 13 per cent, refuses to drop; youth unemployment is an atrocious 43 per cent.

In the 1990s, austerity managed to do the trick in Canada. But the spending cuts did not plunge the country into recession. That's because the economy was still growing, the C-buck was weak and interest rates were high enough that cutting them repeatedly, as the Liberal government did, softened austerity's blow. Austerity was initially attempted in East Asian countries hammered by the 1997-98 financial crisis. But the experiment went nowhere. The International Monetary Fund soon ditched the austerity war cry and encouraged fiscal expansion instead.

It worked. The East Asian countries were treated to a V-shaped recovery. In Europe, the opposite approach was taken. After the start of the 2008 financial crisis, stimulus was at first encouraged, soon to be replaced by austerity when the IMF, the European Central Bank and the European Commission went into a panic about rising debt loads. The European recession – surprise! – remained intact. It is only now that growth has returned, although hardly robust growth.

Britain seemed like the anti-Greece, the one country in Europe that unleashed austerity to good effect. Indeed, Britain last year was the growth star in 2014 among the largest European Union economies (although its growth is waning this year) and Prime Minister David Cameron and his Chancellor are using a stay-the-course message to woo voters. In 2013, Mr. Cameron touted austerity as endless revolution; the goal, he said, was to make the state "leaner, not just now, but permanently."

To claim that austerity saved Britain from Greek-style economic Hades is absurd, even if the country's recent growth rates and fall in unemployment have been impressive by EU standards.

As Martin Wolf of the Financial Times pointed out this week, real gross domestic product per head was 4.8 per cent higher than it was in the second quarter of 2010, when the Conservatives and their coalition partner, the Liberal Democrats, took office. But the GDP figure is no improvement over where it was in 2007, the year before the crisis. And real GDP per head in 2014 was almost 16 per cent below where it would have been had the 1955-2007 growth trend continued. Manufacturing is still well below its precrisis peak and productivity growth has gone missing.

On the contrary, Britain yanked itself out of the trough not because of austerity, but because the bark of British-style austerity was worse than its bite. Economist Paul Krugman has noted that Mr. Cameron's government imposed harsh austerity in the first two years, then eased up, as the continuing budget deficits prove. Britain's forecast 2015 deficit, at 3.7 per cent of GDP, will be higher than Italy's. It is no coincidence that Britain's growth took off when Mr. Osborne eased back on the austerity throttle.

Now the Conservatives, and Labour to a lesser degree, want to replace austerity-lite with what appears to be another round of full-blown austerity. Their zeal to cut, cut, cut is a mystery, especially when the British government can fund itself for almost nothing. Britain can borrow two-year money at 0.5 per cent and 10-year money at 1.8 per cent. Shouldn't Britain be borrowing money to boost investment to make its economy more competitive? If the Conservatives win the election next week and make good on their state-shrinking pledge, Britain's status as the EU's growth star will surely vanish.