Krugman Decries Austerity, Again!

On Sunday, in the article: Austerity Is So Wrong!, New York Times economic columnist, Paul Krugman. once again argued that government spending, not austerity, will "easily and quickly" cause an economy to grow.  But, the best example of why Krugman is "so wrong" is to merely look at Germany as part of the EuroZone.  In 2008, when the recession hit most of the world, Germany suffered greatly because 1/3 of its economy was dependent on exports and the export market had weakened significantly.  Within months however, the economy snapped back quickly.  Today, Germany is the only shining spot in all the EuroZone.  Most of the rest of the countries are either in the throws of recession or teetering on bankruptcy.

Germany flourished when others were still struggling because of the economic recovery programs of Angela Merkel. While it is true that she spent $72 billion dollars in stimulus, it is also true that she cut government spending by nearly twice that amount -- $123 billion -- in austerity programs.  She also convinced labor unions to give up or reduce benefits in what can only be defined as even more austerity.

Germany is now in better shape because they didn't buy into the Keynesian belief that you can simply spend yourself out of a recession.  Something that the likes of Paul Krugman can't get through their heads.