Reply To: Austerity has failed. An open letter from Piketty to Merkel

[Gallup’s Mirror]

Now take a look at GDP growth rate. Notice the correlation between timing of cuts in government expenditure and growth?

No.

1. You cited spending cuts in ranges from 2009 or 2010 to 2013 or 2014, then linked to a chart showing GDP growth as of 2012. You’re implying causality when you failed even to reach correlation.

2. You cited spending cuts starting in 2009 and 2010, but the upward trend begins uniformly (except Greece) at the end of 2008. Cause must precede effect. How do spending cuts cause a reversal which began at least a year earlier?

3. As of the 2012 (the middle of the date range you provided) the chart shows the GDP of Ireland was flat; Spain, Portugal and Greece were in negative growth; Lithuania and Latvia were shrinking slightly; and only the UK was in the black and growing. I see correlations between the depth of the drop in 2008 and the height of the subsequent bounce, but otherwise the results you attribute to spending cuts vary rather conspicuously.

4. Even setting aside these other problems, you are presenting data in a vacuum. How about the global financial crisis of 2008? For instance, if a government is spending less overall but spending more on social safety nets or economic stimulus, how can spending cuts be cited as the fix?

The presented data does not support your claim and lacks any supporting context.