20 June 2011

Austerity Measures in a Recession

I thought it was just me who was observing this phenomenon - and I thought "surely I am seeing things". But no, far finer minds than mine assure me that the furphy disposed of in Jim & Jane Have Fun with Economics has returned from the grave:

For the last few months, I and others have watched, with amazement and horror, the emergence of a consensus in policy circles in favor of immediate fiscal austerity. That is, somehow it has become conventional wisdom that now is the time to slash spending, despite the fact that the world’s major economies remain deeply depressed.


Even my elderly grandmother laughs at this. She asked me what kills zombies. I said I don't know.


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