Me and my Dad are fans of Paul Krugman; our Economist is bigger than your Economist if you like. Mr. Krugman has got a fantastic blog....here are two rather interesting postings that suggest that all these austerity measures are a bit stupid.....http://krugman.blogs.nytimes.com/2010/06/06/lost-decade-here-we-come/ and http://krugman.blogs.nytimes.com/2010/06/07/madmen-in-authority/ In summary:
1. Countries have to cut now to show the markets that they are serious about managing debt over the long run.
2. However cutting spending now will mean less economic activity and therefore lower future tax revenues....
3. ...but surely less tax for the government mean it is harder for them to reduce their debt?
4. The folly of it all is that the markets aren't even asking for these cuts apparently.
I like Clegg and Cameron but surely Gordon Brown didn't get it right.....I think I need to leave the UK and move to France. Isn’t schadenfreude bliss; but it’s even better when it’s not accidental....
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