There can be little doubt that the GOP will become the majority in the House after the midterm elections. The new speaker of the House will be Orange Man Boehner. What will the next few years look like?
Expect no significant stimulus packages (although Pork will still be served hot'n'fresh from the usual suspects). The rich will get tax cuts. Perhaps the payroll taxes (which affect nearly all of us) might increase.
The problem with government austerity right now is that no one else is spending money. If the government doesn't, public sector jobs will get axed (compare to the UK's estimated 500,000 lost jobs thanks to their recent austerity plan). Without those jobs, tax revenues fall causing more government debt and more economic depression.
The only positive thing about austerity is that it may improve the interest rate at which the government can borrow more debt. Super.
The time for government austerity is when the economy is booming. Tax the hell out of the top earners then to pay down debts incurred during times like this.
So the economy will be depressed until 2012. Obama will get tossed out of office. Don't expect Palin to run -- she's got a great gig as a celebrity and can't afford the pay cut. Whoever the Republicans run should take the White House. Then, tax cuts, tax cuts, tax cuts -- none of which will help the middle or lower class.
Remember that tax cuts are a government spending program, especially when tax cuts necessitate more government borrowing (which every state and federal tax cut plan I know of today will do).
Many people benefit from federal entitlement programs and no one wants to give these up. As a nation, we are completely screwed.
(Don't construe this as a pro-Dem rant. There are only bad choices facing the voter in 2010 and 2012. Why worry over the differences?)
Update: One more word on the UK austerity measures. It appears that their government seeks to fight unemployment and rising entitlement costs by creating a massive wave of new unemployment that will require more entitlement spending. Solid thinking there, old bean.