'..We needed lower taxes, less government, and massive work rule reforms (and still do).'<blockquote>'As for the multiplier theory, the IMF is now saying it prescribed the wrong medicine. What was a .5 multiplier is now a range of .9 to 1.7. Anything close to or above 1 means austerity can never work.
No doubt, Krugman will be crowing "I Told You So" over this, but there is not an Austrian economist anywhere that was in support of the massive tax hikes we have seen. Reduction in government spending was not the problem. Rather massive tax hikes and lack of badly-needed reforms was the problem.
Certainly what we know is austerity cannot work "as implemented" but I said that years ago. We have seen massive tax hikes and few work rule and pension reforms. We needed lower taxes, less government, and massive work rule reforms (and still do).
Blaming the problems on "austerity" will get a lot of sympathy from Keynesian clowns, but they cannot distinguish good medicine from cow patties.'
Mike "Mish" Shedlock,
IMF Admits It Prescribed Wrong Medicine; Is IMF Short for I Must Fail? October 12, 2012</blockquote>
Context<blockquote>
(Monetary) bureaucracy - '..our organizations are .. hostages to an ideology that is, in a real sense, inhuman.''Since central bankers cannot and will not admit the truth..''..to cut Greece’s debt load..'</blockquote>