Firstly, empirical evidence suggests otherwise. Political instability and inequality, both consequences of austerity, significantly hamper long-term growth and innovation. No country ever went from poor to rich by neglecting to invest in its people and infrastructure. Lots of countries have gone from rich to poor that way though.

Secondly, even if this were true what does it matter? Many people don't care about how fast the economy is growing overall if their personal fortunes are dwindling. That's just robbing Peter to pay Paul, except in this case Paul is already filthy rich.