In responding to the global economic crisis of the past two years, which nations’ governments got it right and which got it wrong? UMBC political science professor Thomas Schaller asks this question in his latest Baltimore Sun column, which compares economic policies and outcomes in the U.S. and Europe.
“Economic indicators strongly suggest that the Obama administration and those who called in 2009 for a massive, Keynesian stimulus made the prudent, informed choice,” Schaller argues. He writes, “Austerity measures — tax increases and public sector payroll and benefit reductions — actually resulted in higher, not lower debt ratios for some European economies because GDP contraction yielded lower tax revenues, which more than offset any short-term economic savings from budget-slashing.”
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