To those who think the Keynesian stimulus was worthwhile, consider the recent news from the United Kingdom: growth just jumped a surprising 3.2%
Why surprising? Because the UK has been embarking on severe government spending cutbacks of budgets, public employees, and programs. New York Times economist/columnist Krugman had predicted doom for their economy, so is again proving to be the perfect contrarian indicator. He recently said our stimulus was a failure because it wasn’t big enough.
To take another european example, Germany has long had the tightest EU fiscal discipline, and is now rewarded with strong growth, plummeting unemployment, and soaring exports. Most of the EU is running away from its love affair with big spending while we have embraced it. The resulting differences in growth rates and unemployment trends are telling.
