I recently discussed Paul Krugman's views on the European crisis, and suggested that his ideological commitments may have distorted his analysis. Krugman argued that austerity programs would inevitably fail and lead to the destruction of democracy.
I note that Amity Shlaes, a Bloomberg columnist, has also taken issue with Krugman's perspective. "There is evidence that austerity did lead to growth in the past," she writes, "and that it did not cause fascism."
Shlaes questions "the standard ... narrative of what happened" during the Great Depression which lies behind Krugman's views. She cites the example of Australian government cost-cutting in the early 1930s. "Australia recovered far faster than the U.S. ... [Prime Minister Joseph] Lyons may have praised Mussolini but Australia didn't go fascist."
I am not really in a position to argue on the basis of historical economic data or economic theory, but I can see that Franklin Delano Roosevelt has become a mythic hero for many liberals, and the New Deal an inspirational tale.
But inspiring narratives are just that - stories designed inspire (manipulate?), not to encapsulate historical (or any other kind of) truth.
History is complicated, there are no heroes, and the world does not owe us a living.