Cutting Quote by Franklin Raines
“If there's a severe recession, the automatic stabilizers will come into effect, and we will still try to reduce the structural deficit, but we will not try to keep cutting the budget so that we keep worsening a severe recession.”
About This Quote
Source Speech: Economic Policy Discussion, 2009
During a deep recession, automatic fiscal tools activate, and policymakers aim to cut deficits without further shrinking the budget, avoiding worsening the downturn.
In simple terms: Use stabilizers, cut deficits, but don’t shrink the budget during a recession.
Key Takeaway
Balance fiscal responsibility with economic stimulus.
Themes
fiscal policy
recession management
budgeting
Mood
cautious
analytical
Type
policy
economic
When to use this quote
- government budgeting
- economic recovery
- policy planning
- public finance
Key Concepts
automatic stabilizers
structural deficit
budget cuts
Questions to Reflect On
- How can governments protect social safety nets while reducing deficits?
- What are the risks of austerity in a downturn?
A Different Perspective
Reducing the budget can deepen a recession despite deficit concerns.
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