Friday, June 29, 2012

A manifesto

Insanity is doing the same thing over and over again but expecting different results.
Misattributed all over the place it may be, including to Benjamin Franklin and Albert Einstein though probably coming from Rita Mae Brown in her book Sudden Death, but here is another example:
Moreover past experience includes no relevant case where budget cuts have actually generated increased economic activity. The IMF has studied 173 cases of budget cuts in individual countries and found that the consistent result is economic contraction. In the handful of cases in which fiscal consolidation was followed by growth, the main channels were a currency depreciation against a strong world market, not a current possibility. The lesson of the IMF’s study is clear - budget cuts retard recovery. And that is what is happening now - the countries with the biggest budget cuts have experienced the biggest falls in output.
From A Manifesto from Economic Sense.


Grass In Keyboard said...

Really nice info. Thanks for posting.

Anonymous said...

Apropos of which, guess what Osborne proposes spending the (minuscule) fine imposed on Barclays for fiddling the LIBOR rate on? Tax cuts.