Opinion | The Legacy of Destructive Austerity – By Paul Krugman – The New York Times

By 

Opinion Columnist

Credit…Gregory Bull/Associated Press

“A decade ago, the world was living in the aftermath of the worst economic crisis since the 1930s. Financial markets had stabilized, but the real economy was still in terrible shape, with around 40 million European and North American workers unemployed.

Fortunately, economists had learned a lot from the experience of the Great Depression. In particular, they knew that fiscal austerity — slashing government spending in an attempt to balance the budget — is a really bad idea in a depressed economy.

Unfortunately, policymakers on both sides of the Atlantic spent the first half of the 2010s doing exactly what both theory and history told them not to do. And this wrong turn on policy cast a long shadow, economically and politically. In particular, the deficit obsession of 2010-2015 helped set the stage for the current crisis of democracy.

Why is austerity in a depressed economy a bad idea? Because an economy is not like a household, whose income and spending are separate things. In the economy as a whole, my spending is your income and your spending is my income.”

David Lindsay Jr.
Hamden, CT | NYT Comment
Thank you Paul Krugman, this is so correct, if tragic. It is because of your ability to bring such analysis to bear on the confusing issues of our era, that I created a catelogue for you at my blog, InconvenientNews.net called:
Paul Krugman: the Oracle from MIT, Yale, Stamford, Princeton & CUNY.
I remember when you begged Barak Obama and his administration to double their stimulus spending, from about .8 to 2 trillion.You wrote that the depression was so great, that it would take a big stimulus to get the leviathan ship of state moving again in the water. If they had taken your advice then, we might never have suffered the world set back of Trump’s immature, self-centered and corrupt excuse for world leadership.

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