Europe’s New Fiscal Treaty (Kirkegaard)

Europe’s new fiscal compact treaty does not outlaw Keynesianism and is a stepping stone to more progress by Jacob Funk Kirkegaard published by VOXEU. “Europe’s new fiscal compact is seen by some as the death of Keynesian government spending. This column argues that such analysis is simply wrong. It says that there is still room for government spending in extreme situations, but that there are now more safeguards to maintain stability, reduce contagion, and placate German taxpayers.”