Austerity on Trial With U.S. Versus Europe Amid New Evidence

[xchrom]

http://www.bloomberg.com/news/2013-04-21/austerity-on-trial-with-u-s-versus-europe-amid-new-evidence.html

Global policy makers and economists are staging a retrial of austerity as new evidence arises.

Facing another slowdown in the world economy, the U.S. and International Monetary Fund are pitched against the euro area and U.K. over whether axing budgets and debt is the recipe for recovery or recession. In academia, professors Kenneth Rogoff and Paul Krugman remain at odds.

The dispute, which led to finger-pointing and a fight over setting new debt targets at weekend talks of finance chiefs in Washington, is getting a re-airing as economic data from the U.S. to Europe undershoot estimates. Research co-written by Rogoff that has been used to justify cuts has come under scrutiny.

“Delaying necessary adjustments would further aggravate risks for the prospects of a lasting and fundamentally sound global recovery,” German Finance Minister Wolfgang Schaeuble told the fund’s 188 member nations. IMF Managing Director Christine Lagarde told Bloomberg Television that “for some of them there’s no reason to rush into up-front, heavily loaded fiscal consolidation.”

***there will never, ever be enough evidence for austerians, corporate pirates, financialists and banksters.
the point and the only point to austerity is to lift money from the Every Man and Every Woman into the pockets of the Elite.

[Benton D Struckcheon]

1. Debt Deflation

by Irving Fisher: http://fraser.stlouisfed.org/docs/meltzer/fisdeb33.pdf

This stuff is known. Keynes used this essay by Fisher (first version of which came out on Jan 1, 1932) as his starting point in developing his theories. If you withdraw liquidity in a time of debt liquidation you are asking for big trouble. It ain't rocket science, it's common sense.

[CTyankee]

2. And here's today NYT article saying essentially the same thing:

http://www.nytimes.com/2013/04/22/business/global/europe-heeding-international-call-to-do-more-to-spur-growth.html?ref=business&_r=0

The tide is turning and the arc is bending toward justice...

[marmar]

3. k/r

[malaise]

4. This

the point and the only point to austerity is to lift money from the Every Man and Every Woman into the pockets of the Elite.

[CTyankee]

5. More great stuff from Dr. Krugman in today's NYT blogs!

http://krugman.blogs.nytimes.com/

[xchrom]

6. +1