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Home Publications Blogs Beat the Press European Budget Deficits Did Not "Balloon" in the Credit Bubble of the Last Decade

European Budget Deficits Did Not "Balloon" in the Credit Bubble of the Last Decade

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Sunday, 22 April 2012 09:02

Fox on 15th Street is on the loose again. A Washington Post article on renewed worries over European sovereign debt referred to:

"massive cuts in government spending aimed at reducing deficits that ballooned during the credit bubble of the past decade."

No, the deficits did not balloon during the bubble. Greece and Portugal did run large deficits in the bubble years. However Italy's debt to GDP ratio was falling and the other two crisis countries, Spain and Ireland, were running budget surpluses.

How can a Washington Post reporter not know these facts? How can an editor allow this assertion to get into print? We know that claims like this fit the Post's obsession with deficits, but the paper should show a bit more respect for the facts.

Comments (3)Add Comment
"the paper should show a bit more respect for the facts"
written by Paul, April 22, 2012 11:17
Ha Ha, good one. Like that could happen.

WaPo motto: Never let the facts get in the way of a good story.
www.theartofmarkets.com
written by fuller schmidt, April 22, 2012 7:34
Religion is a big hint that factuality is not always a necessity.
Definition of Past Decade = 2002 to 2012
written by cas127, April 23, 2012 6:46
Per the World Bank:

Central Government Debt as % of GDP:

Ireland
2002: 35%
2009: 71% (Latest Available)

Spain
2002: 53%
2009: 48% (Latest Available)

Italy
2002: 115%
2009: 118% (Latest Available)

And considering what 2010 and 2011 likely held, perhaps WAPO isn't as far off as a certain blog I could mention...but I'm sure you are only counting the years...you want to count...

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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