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The yield on Irish debt is now 10% and unemployment is 13%. Portugal's debt has become more expensive and the economy is not recovering. Britain has lowered its growth forecast and unemployment has not recovered. Deficit hawks cheered their austerity plans but their economies are lagging behind. That means that tax revenues will continue to fall and erode any impact from spending cuts. Krugman argues that we should be putting people back to work now in order to increase tax revenue and put a plan in place to deal with the real fiscal problems we have in the long run. It seems as if politicians are more focused on what they do best: political campaigning, instead of solving our real problems.
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