# Why the sudden obsession about deficit cutting all of a sudden? **URL:** \ **Category:** Great Debates\ **Created:** [June 27, 2010, 10:22pm UTC](https://boards.straightdope.com/t/why-the-sudden-obsession-about-deficit-cutting-all-of-a-sudden/544720 "2010-06-27T22:22:29Z")\ **Posts on this page:** 8\ **Page:** 4
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [June 29, 2010, 6:15pm UTC](https://boards.straightdope.com/t/why-the-sudden-obsession-about-deficit-cutting-all-of-a-sudden/544720/61 "2010-06-29T18:15:07Z")
> [@2sense](#): > > Surely you have encountered these arguments before? Yeah, but there’s always the chance that noone will bring it up this time around. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [June 29, 2010, 6:16pm UTC](https://boards.straightdope.com/t/why-the-sudden-obsession-about-deficit-cutting-all-of-a-sudden/544720/62 "2010-06-29T18:16:34Z")
> [@Baboonanza](#): > > I would add some caveats: > > - Everyone’s defecit as a % of GDP has increased > - Ireland was particularly vulnerable to this recession. Some fall in tax reciept was inevitable anyway, how do you know it’s mainly due to cuts? > > Your final point is fair, but it’s a not useful for drawing conclusions about what would happen to another economy now. We are on the other end of the recession and have already had a stimulus. The situation is very different. There’s an old saying, save money when you have money to save and spend it when noone else is. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [June 29, 2010, 6:31pm UTC](https://boards.straightdope.com/t/why-the-sudden-obsession-about-deficit-cutting-all-of-a-sudden/544720/63 "2010-06-29T18:31:38Z")
> [@erez](#): > > Nice try, but the matter is far from settled among economists. A 1995 survey ([Where Is There Consensus Among American Economic Historians? The Results of a Survey on Forty Propositions on JSTOR](http://www.jstor.org/pss/2123771), I am not aware of any newer ones) showed that half of the economists and a quarter of economic historians agreed, in whole or with stipulations, that the New Deal prolonged the Great Depression. I didn’t say the matter was absolutely settled, I was responding to a statement that “Keynesian solutions have an exceptionally poor track record” but feel free to beat the shit out of that straw man. Here is the excerpt for those who don’t want to spend $34 to read the relevent part of the article that Erez linked: “Specifically, when asked whether “as a whole, government policies of the New Deal served to lengthen and deepen the Great Depression,” 74% of respondents who taught or studied economic history disagreed, 21% agreed with provisos, and 6% fully agreed. Among respondents who taught or studied economic theory, 51% disagreed, 22% agreed with provisos, and 22% fully agreed. Robert Whaples, “Where Is There Consensus Among American Economic Historians? The Results of a Survey on Forty Propositions,” Journal of Economic History, Vol. 55, No. 1 (Mar., 1995), pp. 139-154 in JSTOR see also the summary at “EH.R: FORUM: The Great Depression”. [Eh.net](http://Eh.net). Retrieved 2008-10-11.” The above excerpt is actually a footnote to the following sentence in the wiki article on the great depression: “One small voluntary response survey from 85 Ph.D. holding members of the Economic History Society, which the author stated may not be representative of all economic historians, showed that there were statistically different opinions between economic historians who taught or studied economic history and those that taught or studied economic theory. The former were in consensus that the New Deal did not lengthen and deepen the depression, while the latter were more evenly divided” So yeah, explain to me how this citation proves (or even supports the notion) that “Keynesian solutions have an exceptionally poor track record” (after all that is the claim that I said was a rewriting of economic history). ---
**Author:** ![Leaper](https://avatars.discourse-cdn.com/v4/letter/l/4bbf92/32.png) [@Leaper](https://boards.straightdope.com/u/Leaper)\ **Post date:** [June 30, 2010, 5:10am UTC](https://boards.straightdope.com/t/why-the-sudden-obsession-about-deficit-cutting-all-of-a-sudden/544720/64 "2010-06-30T05:10:23Z")
[Another relevant Paul Krugman op-ed](http://www.nytimes.com/2010/06/28/opinion/28krugman.html), at least for that POV. (Note that he believes that this is already a depression.) ---
**Author:** ![erez](https://avatars.discourse-cdn.com/v4/letter/e/e47c2d/32.png) [@erez](https://boards.straightdope.com/u/erez)\ **Post date:** [June 30, 2010, 5:41am UTC](https://boards.straightdope.com/t/why-the-sudden-obsession-about-deficit-cutting-all-of-a-sudden/544720/65 "2010-06-30T05:41:44Z")
> [@Damuri\_Ajashi](#): > > I didn’t say the matter was absolutely settled, I was responding to a statement that “Keynesian solutions have an exceptionally poor track record” but feel free to beat the shit out of that straw man. You were saying, and I quote: > [@](#): > > Is this part of the rewriting of history that is trying to present FDR as part of the problem and not part of the solution to the Great Depression? How is it rewriting history to say that FDR was the part of the problem, if half of the economist agree with that statement? Your statement was total BS. > [@Damuri\_Ajashi](#): > > The above excerpt is actually a footnote to the following sentence in the wiki article on the great depression: > > “One small voluntary response survey from 85 Ph.D. holding members of the Economic History Society, which the author stated may not be representative of all economic historians, showed that there were statistically different opinions between economic historians who taught or studied economic history and those that taught or studied economic theory. The former were in consensus that the New Deal did not lengthen and deepen the depression, while the latter were more evenly divided” > > So yeah, explain to me how this citation proves (or even supports the notion) that “Keynesian solutions have an exceptionally poor track record” (after all that is the claim that I said was a rewriting of economic history). Where did I say that this survey proves anything about Keynesian solutions? I was responding to your incorrect statement that presenting FDR as a part of the problem after the Great Depression is rewriting of history. Do you now admit that you were wrong? ---
**Author:** ![Dick\_Dastardly](https://avatars.discourse-cdn.com/v4/letter/d/c4cdca/32.png) [@Dick\_Dastardly](https://boards.straightdope.com/u/Dick_Dastardly)\ **Post date:** [June 30, 2010, 3:02pm UTC](https://boards.straightdope.com/t/why-the-sudden-obsession-about-deficit-cutting-all-of-a-sudden/544720/66 "2010-06-30T15:02:32Z")
> [@erez](#): > > Nice try, but the matter is far from settled among economists. A 1995 survey ([Where Is There Consensus Among American Economic Historians? The Results of a Survey on Forty Propositions on JSTOR](http://www.jstor.org/pss/2123771), I am not aware of any newer ones) showed that half of the economists and a quarter of economic historians agreed, in whole or with stipulations, that the New Deal prolonged the Great Depression. That’s because there are two schools of thought in the American economics profession. You have what Krugman calls the freshwater and the saltwater schools, the saltwater guys coming from colleges on the coasts and the freshwater guys inland. The freshwater lot believe in perfect markets and deregulation so obviously as a matter of ideology they’re going to say that any government intervention in the markets is a bad thing and so FDR’s massive intervention was therefore a massively bad thing. On the first page of the thread Voyager pointed out an articlle where the freshwater guys were all asked why things had gone wrong and what happened to their perfect markets, they came up with answers of varying hilarity and were much mocked and derided for what they had to say. ---
**Author:** ![MOIDALIZE](https://avatars.discourse-cdn.com/v4/letter/m/e274bd/32.png) [@MOIDALIZE](https://boards.straightdope.com/u/MOIDALIZE)\ **Post date:** [June 30, 2010, 5:30pm UTC](https://boards.straightdope.com/t/why-the-sudden-obsession-about-deficit-cutting-all-of-a-sudden/544720/67 "2010-06-30T17:30:50Z")
Clearly everyone has chosen to be unemployed. ---
**Author:** ![foolsguinea](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/foolsguinea/32/14751_2.png) [@foolsguinea](https://boards.straightdope.com/u/foolsguinea)\ **Post date:** [July 1, 2010, 12:02am UTC](https://boards.straightdope.com/t/why-the-sudden-obsession-about-deficit-cutting-all-of-a-sudden/544720/68 "2010-07-01T00:02:13Z")
> [@2sense](#): > > This is why, I think. Keynesian spending is counterintuitive. Tightening your belt seems like the natural response to tough times so if you don’t use your brain to figure out why that’s a bad idea… This I find bizarre. It seems obvious to me that if the size of the economy = money supply x velocity, then increasing velocity IS growth. You can do that through deficit spending; or through simple zero-sum redistribution to the unemployed (who want to spend more than they have) & wannabe entrepreneurs (who want to create more productivity than they can on their present income). I have to assume that these economists hail from outside the Judeo-Christian tradition. I was taught the story of Joseph in Sunday School. Save in fat times, spend the surplus down in lean times. But ostensibly intelligent people, who probably could define “pro-cyclical” if you asked them, insist we should do the opposite. This is worse for economics than attempting to bleed the Four Humours was for medicine. [Previous page](https://boards.straightdope.com/t/why-the-sudden-obsession-about-deficit-cutting-all-of-a-sudden/544720.md?page=3)