Most would agree that properly directed stimulus and
properly directed austerity are both good things.
Then why is there a “debate” between them?
It’s because many – perhaps most – politicians don’t
understand “properly directed” .
Example: Expenditure is mistaken for stimulus,
which must be directed toward productive ends.
What is sometimes called “stimulus” is often
merely a process of scattering currency to the
winds. Any “stimulating” government must ask the
question: What improved tooling, process, or
product can be financed with my “stimulus”?
There is a direct link from this question to the
current handwringing over the steadily falling
numeracy in the Western economies. Many
politicians now in high office were victims of
so-called “Progressive” education. Starting
in the 60s, this has turned out grown adults
some of whom cannot even count, much less
do arithmetic, less yet understand discounted
cash flow and similar analyses that tell a private
firm whether some project is productive or not.
Modern education systems like “Discovery”
math actually train students to become
innumerate and to hate math. When this
can be corrected, the debate between
“stimulus” and “austerity” will vanish.