Austerity Reduces Deficit-Proves Calls For Austerity Was Unfounded?
But this drop in the deficit comes after austerity measures have been implemented! Remember, the so-called "fiscal cliff" that Keynesians said would trigger a deep slump if implemented. Well, most of the tax increases in the "fiscal cliff" have now been implemented, and the spending cuts of the so-called "sequester" were implemented entirely, though with a two month delay.
Krugman's reasoning is like a fat guy who is forced to go on a diet, loses 10 kilos/22 pounds in weight, and then points to the weight drop to argue that the diet wasn't necessary to lose weight.