Wednesday, October 24, 2012

It's Not the Deficit, Stupid!


"New data from the European Union, released on Monday and analyzed in The Times by Landon Thomas Jr. and David Jolly, show that countries that have most ruthlessly cut their budgets — Greece, especially — have seen their overall debt loads increase as a share of the economy.

The data provide objective support for what has been clear to just about everyone except pro-austerity German officials and deficit-crazed Republican politicians. Namely, deep government budget cuts at a time of economic weakness are counterproductive, complicating, if not ruining, the chances for economic growth."

New York Times' editorial on October 24, 2012: The Austerity Trap

It concludes:

"Mr. Obama is better positioned than Mr. Romney to deliver that agenda. Mr. Obama could make his jobs plan, introduced last September but blocked by Congressional Republicans, part of the budget package to be negotiated after the election, when politicians must agree on tax increases and spending cuts to avoid the so-called fiscal cliff.


Mr. Romney’s agenda is missing a direct focus on jobs, foolishly relying instead on high-end tax cuts and deregulation to help the recovery. And he and his party continue to insist on premature deficit reduction that, in a fragile economy, is the real road to Greece."

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