Intellectual foundation of Republican push for austerity falls apart
Economic policy wonks are buzzing today over revelations that a celebrated study conducted by a couple of Harvard University academics was fundamentally flawed.
Steve Benen has the story HERE:
Carmen Reinhart and Kenneth Rogoff published a report a few years ago that was music to the ears of Republicans: when a nation’s debt climbs above 90% of the nation’s total economy, it necessarily serves as a drag on economic growth. The Reinhardt/Rogoff study became the intellectual foundation for austerity and a deliberate shift from job creation to debt reduction.
The problem, we now know, is that Reinhart and Rogoff made some important errors in their research, including a careless mistake in an Excel spreadsheet. The economic research embraced by conservatives everywhere was faulty…
And while Reinhart and Rogoff have quite a bit of work to do, it’s important to realize that this story is about far more than a flawed study. I care that the Reinhardt/Rogoff report was mistaken, but I really care that the report was used to justify widespread and deliberate economic harm.
The Very Serious People took it on faith that once the debt-to-GDP ratio topped 90%, a nation has no choice but to pursue austerity measures…
I know better than to hope for accountability, but given the significance Republicans, news organizations, and the DC establishment placed on the flawed Reinhardt/Rogoff findings, can we begin the discussion anew about focusing on economic growth and job creation? Can every Republican who based their talking points on this study be asked whether they’re prepared to reevaluate their misguided assumptions about slashing investments and hurting the economy on purpose?