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Politics : American Presidential Politics and foreign affairs
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To: DuckTapeSunroof who wrote (43345)5/21/2010 7:03:38 PM
From: TimF  Read Replies (1) of 71588
 
About the size of the downturn - I wouldn't quite say not dispute, but substituting "little dispute" might be considered quibbling. There is much more dispute about the idea of stimulus packages, of adding new spending, but most would agree that going beyond avoiding that and actually slashing spending during a sharp down turn, tends to be negative in the short run.

I wasn't disputing the short run economic hit, but rather that it would be big enough to reduce tax revenue more than the amount of the spending cut. Such a result would be extremely unusual. Its not totally impossible, but it would be shocking. So I'd have to disagree when you add "and the size the deficit". In terms of Euros the cut almost definitely reduced the deficit. In terms of percentage of GDP, where a smaller GDP makes the measured deficit percentage larger even if the Euro deficit stays the same, it might be a bit closer to reasonably possible, but is still VERY unlikely.

and I fully believe, that the actions they have taken will *both* worsen the severity of the Irish economic slump over the near-turn... while also strengthening the prospects for real growth over the long-run.

We are pretty much in agreement on that specific point.
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