For Britons who have been laboring through more than five years of recession, or near recession, that is welcome news. By some measures, the U.K. has been through a worse slump than the one it experienced during the Great Depression, and now, at last, it appears to be over. Recent figures from the Office for National Statistics show that the economy has expanded for three quarters in a row, with manufacturing, services, and construction all sharing in the growth. Small wonder that Osborne was smiling and taking the credit.

It’s a clever political line, and it appears to be having an impact. The rebound in the economy, which caught by surprise most forecasters, including those at the Office for Budget Responsibility, has transformed the political situation at Westminster and given the Conservative-Liberal coalition, which has been lagging badly in the opinion polls, new hope of winning reëlection in May 2015.

But from an economic perspective, Osborne’s argument is hogwash. His effort to cure the patient by subjecting it to the equivalent of leeching—big cuts in government spending and higher taxes—a return to pre-Keynesian policies watched closely the world over, failed abysmally. Imposed at a time when the U.K.’s economy was recovering from the financial crisis of 2008-09, it subjected his countrymen and countrywomen to three more years of slump-like conditions, and it produced a dearth of public-sector and private-sector investment that will hobble Britain for years to come. It even failed to meet its own targets of drastically reducing the budget deficit and bringing down Britain’s over-all debt burden.

Back in June of 2010, just after the Conservative-Liberal coalition took office, but before Osborne introduced big spending cuts and raised the national sales tax to twenty per cent, the Office for Budget Responsibility predicted that the economy, after contracting sharply in 2009, would expand by 1.3 per cent in 2010, and that growth would then accelerate to 2.6 per cent in 2011 and 2.8 per cent in 2013. By the standards of previous recoveries, this growth forecast looked pretty modest, and it reflected the fact that the previous Labour government had already promised modest cuts in spending growth to bring down the budget deficit, which reached about eleven per cent in the fiscal year 2009-10. (In Britain, the fiscal year goes from April 1 to March 31.)

However, after Osborne introduced his austerity drive, economic growth slowed down rather than speeding up. For 2010, the economy outperformed the official forecast, growing by 1.7 per cent, reflecting the fact that it had quite a big of momentum when the new government took over. But in 2011, growth dropped to 1.1 per cent, and last year it fell to 0.2 per cent, leaving inflation-adjusted G.D.P. below the level it reached in 2007.

How much of this dramatic shortfall in growth was due to Osborne’s policies, and how much was caused by other factors, such as the crisis in the Eurozone, Britain’s biggest trading partner? As always in economics, it’s hard to know for sure. A recent study by Òscar Jordà and Alan Taylor, two economists at the University of California at Davis, which employed some sophisticated statistical techniques, concluded that the shift to austerity was the main culprit, accounting for sixty per cent of the fall-off. “Without austerity,” Taylor wrote in an article presenting their results, “U.K. real output would now be steadily climbing above its 2007 peak, rather than being stuck two per cent below.”

One can quibble with Jordà and Taylor’s precise figures. The fiscal “multipliers” they use are derived from data from seventeen O.E.C.D. countries covering the period from 1978 to 2009, and it’s not clear why they should apply exactly to the U.K. in isolation for the period from 2010 to 2013. But if the sixty-per-cent figure is biased, there is reason to believe it is biased downward. For the past few years, short-term interest rates in Britain, as in the U.S., have been close to zero, and it’s long been known that fiscal policy is more potent when interest rates are very low. In such circumstances, cutting government spending and raising taxes is doubly damaging.

Simon Wren-Lewis, a professor at Oxford, has used the results Jordà and Taylor provided to convert the losses in G.D.P. over the course of Osborne’s policy experiment into everyday terms. Here is his conclusion:

(A)usterity has cost the average U.K. household a total of about £3,500 [about $5,700] over these three years. Although all governments like to give the impression that they can have a big impact on people’s prosperity, few actually do. These numbers suggest that the current U.K. government has managed to do so, but unfortunately by making us all poorer.

O.K., a committed Austerian might respond, that doesn’t sound very good. But if the Chancellor has succeeded in putting the finances of the U.K. government in order, and prevented Blighty from turning into Greece, the sacrifices might well have been worth it. And, in fact, Osborne has pushed this very line. “The hard work of the British people is paying off, and we are not going to squander their efforts,” he said in his Commons speech.

The problem with the argument is that the “hard work” hasn’t paid off. After three and a half years of austerity, the outlook for the government’s finances doesn’t look any better than it did when Osborne entered office. In fact, it looks worse. Let’s go back to the Office for Budget Responsibility’s June, 2010, forecast, which didn’t account for any of Osborne’s “deficit reduction” measures. Based on its expectation of steady growth in G.D.P., it predicted that the U.K.’s public-sector net-borrowing requirement, the closest equivalent to the U.S. budget deficit, would be 6.6 per cent of G.D.P. in 2012-13, five per cent in 2013-14, and 3.9 per cent in 2014-15.

Osborne, on introducing his austerity policies, claimed that the deficit would come down a lot more rapidly than the Office for Budget Responsibility had forecast. He also pledged that a measure of the so-called “structural” budget deficit—i.e., one that strips out the effects of the economic cycle—would be balanced by 2015-16. But what has actually happened? In 2012-13, the deficit came in at 7.3 per cent of G.D.P.—that’s 0.7 percentage points higher than the official forecast made in 2010. (This figure doesn’t include some tricks that Osborne used to make things look better, such as selling off part of the Royal Mail to investors and counting the proceeds as revenue.) All that austerity didn’t reduce the deficit: it made it bigger than had been expected!

Looking ahead, the picture doesn’t appear any brighter. According to the latest forecast by the Office for Budget Responsibility, which was released on Thursday, the deficit will be 6.8 per cent of G.D.P. in 2013-14, which is 1.6 percentage points higher than the 2010 forecast, and 5.6 per cent in 2014-15, which is 1.7 percentage points higher than the 2010 forecast. As for Osborne’s pledge to eliminate the structural deficit by 2015-16, that, like much else, has been revised. He now says that the structural budget will be balanced in 2017-18, and that the over-all deficit will disappear in the following year. “He used to say he would balance the books in 2015,” Ed Balls, Labour’s senior economic official, said in the Commons. “Now he expects us to congratulate him for saying he’ll do it by 2019.”

And that’s not all. Back in 2009 and 2010, when Osborne was busy comparing Britain to Greece, he made great show of the fact that its debt burden was growing rapidly—a development he promised to reverse. In his first budget, he said public-sector debt as a proportion of G.D.P. would peak in 2013-14, at 70.3 per cent, and then start falling. That promise is another one that has gone by the wayside. The Office for Budget Responsibility is now predicting that the debt burden will keep climbing until 2015-16, when it will peak at eighty per cent of G.D.P.—almost ten percentage points above Osborne’s original figure.

After all this, you may be wondering: why did the U.K start growing again at a decent clip? This time last year, such a rebound seemed unlikely. Well, it didn’t come about because of any philosophical reversal on Osborne’s part. In this year’s budget, he promised to introduce even more spending cuts over the coming years, and, in his Autumn Statement, he talked of introducing a new austerity-based fiscal compact that would tie the hands of his successors.

The upturn in growth appears to have been primarily a result of ultra-low interest rates, engineered by the Bank of England, and of a desperate effort on the part of the government to gee up the moribund housing market. In 2012, the Treasury leaned on the Bank of England to provide low-cost financing for banks that extended mortgages. Then, in this year’s budget, the Treasury itself went into the business of providing loans to help first-time buyers of properties worth up to a million dollars. The tactics worked: home prices are rising rapidly, construction has spiked, and the rise in housing wealth has fed through to a growth in consumption. Business investment and exports remain depressed.

Osborne is busy claiming credit for the upturn, and, to the extent that he was responsible for an old-fashioned effort to ramp up the real-estate market, he did play a role. But that doesn’t mean his austerity policies have worked: they haven’t. As Alan Taylor pointed out, the entire sorry episode only confirms what Keynes wrote seventy-five years ago: “The boom, not the slump, is the right time for austerity at the Treasury.”

Above, at left: George Osborne leaves the Treasury. Photograph by Simon Dawson/Bloomberg/Getty.