So, we’re going to see whether this Keynesian thing actually works or not, aren’t we?
Absolutely every commentator even vaguely left of centre says that the fiscal contraction (ie, the combination of spending cuts and tax rises) is going to devastate the economy. We’re going to get a double dip recession, unemployment will go over 4 million etc.
Let us imagine that this doesn’t happen: will we then have put to bed the idea that only government spending can get us out of such recessions?
Or if, in two or three years time, this hasn’t happened, will they just walk away whistling, hoping no one will have noticed?