'Austerity is everywhere but in the statistics'

Paul Krugman and his merry band of Keynesians have been wailing for years about how "austerity" has kept the world in recession. Only through massive stimulus spending can Euro-economies resume their growth. To a lesser extetnt, the same holds true for the US, they claim. With real unemployment still over 10%, this is no time for the sequester and other austerity measures. But suppose - just suppose - that "austerity" is a myth and that far from slashing spending to the bone, european economies are still spending like there's no tomorrow? Paul Roderick Gregory writing in Forbes: The official Keynesian story is that the PIIGS of Europe (Portugal, Italy, Ireland, Greece and Spain) have been devastated by cutbacks in public spending. Austerity has made things worse rather than better - clear proof that Keynesian stimulus is the answer. Keynesians claim the lack of stimulus (of course paid for by someone else) has spawned costly recessions which threaten to spread.  In other...(Read Full Post)