Economic reality versus ideology: spending cuts and recovery

In this week's New York Times column, Nobel-winning economist Paul Krugman debunks the idea of heavy government cuts as a way to economic recovery:

The key point is that while the advocates of austerity pose as hardheaded realists, doing what has to be done, they can't and won't justify their stance with actual numbers -- because the numbers do not, in fact, support their position. Nor can they claim that markets are demanding austerity. On the contrary, the German government remains able to borrow at rock-bottom interest rates.

So the real motivations for their obsession with austerity lie somewhere else.

In America, many self-described deficit hawks are hypocrites, pure and simple: They're eager to slash benefits for those in need, but their concerns about red ink vanish when it comes to tax breaks for the wealthy. Thus, Senator Ben Nelson, who sanctimoniously declared that we can't afford $77 billion in aid to the unemployed, was instrumental in passing the first Bush tax cut, which cost a cool $1.3 trillion.

That '30s Feeling (via Making Light)

(Image: Library of Congress)

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