So today's WSJ article on Keynes says: <quote> But the 1990s boom has also had a distinctly reverse-Keynesian flavor. Countries that made the tough decisions to reduce their deficits have thrived, as supportive financial markets rallied, further discrediting the old Keynesian thinking. For a 1996 report on fiscal policy around the world, IMF economists conducted a detailed study of 62 attempts by industrial countries over the prior quarter-century to get their finances in order. The study concluded that the 14 cases where governments had been the most draconian -- notably Denmark and Ireland in the mid-1980s -- resulted in the fastest growth. "The simple 'Keynesian' view of fiscal consolidation is that lower government purchases or higher taxes reduce aggregate demand," the report said. Instead, it concluded, "there may be a virtuous circle between economic growth and debt-ratio reduction." </quote> I've given up trying to get a response to this sort of thing from the cranks on PKT. Any reactions here? Doug
