It's been a very bad week for the austerity movement.

Austerity has been discredited as a path to economic prosperity for awhile.

But a real breakthrough came last week, when a paper written by a graduate student (UMass Amherst's Thomas Herndon) debunked the famous Reinhart & Rogoff study, which had claimed that growth slows precipitously when a country's debt rises above 90% of GDP.

Since then, more dominos have tumbled.

In Europe, we've seen a backlash against austerity from various names, whether it's the International Monetary Fund criticizing the U.K. fund manager Bill Gross doing the same, or European Commission President Jose Manuel Barroso talking about the limits to austerity.

And now all of this has broken through to the mainstream with last night's Colbert Report, where that grad student, Thomas Herndon, was the guest.

Colbert had two segments devoted to making the austerians look like total laughingstocks.

One was the actual interview with Herndon. The other came as part of a news comment, where he mocked Paul Ryan and "Rogaine and Braveheart," along with several other mean nicknames.

It was one of those cultural moments. Suddenly one side just looks like fools in the national media.

Incidentally, this is exactly what Paul Krugman predicted last week would be the significance of Herndon's paper:

The point is that the next time Olli Rehn, or George Osborne, or Paul Ryan declares, sententiously, that we must have austerity because serious economists (i.e., not Krugman and friends) tell us that debt is a terrible thing, people in the audience will snicker — which they should have been doing all along, but now it has become socially acceptable.

Below are the two clips, the first being the interview with Herndon, and the second is the broader discussion of how influential Reinhart and Rogoff were on politics.

Read more: http://www.businessinsider.com/stephen-colbert-on-thomas-herndon-and-reinhart-and-rogoff-2013-4#ixzz2RW93ltsf

Link above contains Stephen Colbert if you want a better (comedic) understanding 

Things in the US still have not recovered. High unemployment. High underemployment. Beginning a new housing bubble. The education bubble will have to burst sometime. Dont see how you can say we have spent ourselves into the good times when we haven't, and we still have to pay it all back. Also dont know how you can say that austerity has failed when we aren't through the mess yet. I say its too early to call right now. Why dont we wait until we are actually paying of our debt, have a good unemployment % and underemployment is a thing of the past before we declare a winner.

They've been trying that in Europe for a few years. Where has it gotten them? Some of the countries are almost entering a recession again. Maybe a few years isn't enough time, but it certainly hasn't convinced me that austerity is helpful when you're already in a weak economy.

I wouldnt call 50%-70% tax on its people austerity, they are spending less than they did before, but they also had a massive problems. I dont see any country that has spent its way to propsperity yet either. A few years is not enough, you cant call a winner until things are close to where they were and their is confidence in the economy again. I dont see any signs of that. I am open to examples of countries that managed to spend their way to success, but I cant think of any. I do concede that things aren't as bad as I thought they would be with our continued spending, but I also dont think we're through it yet so things  can get worse again.

maybe not countries, but on a smaller scale, companies do it all the time.

We people on the left have said it all along and yet we get ignored until most economists and organisations say it. We need to try a Keynes approach for once. Unfortunately, in my country at least we have an incompetent moron for prime minister (David Cameron) who would rather follow his bullshit ideology and fuck up this once great country. Maybe we need more efficient spending here but don't just carelessly cut everything.

Society pays the ultimate price when you have penny pinching corporate lawyers running the nation instead of finance/economics experts. The myth that all debt is bad has been disproved time and time again. People take out mortgages and credit cards all the time and businesses need debt to finance their business activities. The government taking on public debt helps boost the economy.

Companies try to make money and turn a profit.

Governments don't.  

I'd point out that the UK's GDP growth predictions... even lowered actually aren't that far off the US.

EVERYWHERE regardless of strategy seems to be stuck at ~1-2% GDP growth.

Even if you think the debt spending is making the difference... why kill yourself for 2%, building up a future huge disaster?  When you could have 1% and have a safer future?

Espiecally if nearly all that 1% is a boost soley due to government spending!

spending isn't bad and neither is austerity - extremes of both are bad