Republican claims that contractionary fiscal policy is expansionary



On Republican claims that contractionary fiscal policy is expansionary: Jonathan Chait: "Neil Irwin: 'Republican leaders urge a steep and swift reduction in government spending... that these cuts would strengthen economic growth not only in the distant future but almost immediately. That view is at odds with many of the nonpartisan groups...' [Alesina's] study... suggests that deficit reduction can increase growth.... But Noah Kristula-Green.... 'The problem: [Alesina] found very few cases.... 9 examples out of 107... more... problematic... is that... growth and deficit reduction occurred [only] in countries where cuts in spending were accompanied with... looser monetary policy... conservative-derided quantitative easing (QE2)...' In short, the proposition that cutting spending will increase short-term economic growth is totally unserious. The one piece of alleged ballast turns out not to support the case."