Over the past few days, new strikes and riots have convulsed Greece and Spain. Conventional wisdom (including from economist Paul Krugman) suggests that cuts in government spending—often described as “austerity”—are a primary cause of the economic downturn in these nations and across much of Europe. This “demand deficiency” hypothesis leads …
Harvard economist Larry Summers claims in The Washington Post that aggressive fiscal austerity in the U.K. is the primary cause of its continued economic stagnation. But the former Obama advisor understates both the necessity for a credible British fiscal plan in 2010 and the structural factors that have been a …
