Ok, so I know that others have pointed this out in the past, but here is another perfect example of pathological centrism from at Clive Crook Bloomberg. This passage, in particular, struck me:
“Keynesians seized on an error in one of the authors’ papers and on the fact that correlation isn’t causation to imply that austerity is always dumb, also a non sequitur.”
Not much to say here except that I can’t think of a single ‘Keynesian’ economist that I read regularly who thinks that austerity is always dumb, in all circumstances. One of the biggest non-substantive differences between the economic right and left in America over the last 5 years has been the ideological bent of the right vs. the nuance of the left. I really don’t think I am building up a straw man when I say that Paul Ryan would lend his unqualified support to a plan that shrunk budget deficits and cut government spending regardless of the economic circumstance.
I do not think the inverse is true for Keynesians; they do not think that a budget deficit is never harmless, it is just in this particular economic circumstance (economy below potential, interest rates at zero-lower-bound) when Keynesians advocate for more fiscal stimulus. If you don’t believe me, here is Brad Delong talking about the Clinton administration’s fear of deficits. This is sloppy reporting and it needs to be corrected.