In Britain and the US, Economic Mysticism Endures

http://truth-out.org/opinion/item/11680-in-britain-and-the-us-economic-mysticism-endures

Friday, 21 September 2012 09:23 By Paul Krugman, Krugman & Co.

In a lot of ways George Osborne, the chancellor of the Exchequer (or finance minister) is Britain's answer to Paul Ryan, the Republican nominee for vice president.

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Mr. Osborne's big idea in 2010 was that Britain should turn to fiscal austerity now now now, even though the economy remained deeply depressed; it would all work out, he insisted, because the confidence fairy would come to the rescue.

Never mind those whining Keynesians who said that premature austerity would send Britain into a double-dip recession.

Strange to say, Britain's recovery stalled soon after Prime Minister David Cameron and Mr. Osborne began their new policies, and the country is now in a double-dip recession.

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[See the link above for a chart showing real GDP in Britain vs. US.]