Oh, my. Josh Barro tells us that conservatives are once again touting Canada as a role model, in particular using its experience in the 90s to claim that austerity is expansionary after all.

I think this qualifies as a cockroach idea (zombies just keep shambling along, whereas sometimes you think you’ve gotten rid of cockroaches, but they keep coming back.) I thought we had disposed of all this four years ago. But nooooo.

Barro hits the main points. Canadian austerity in the 1990s was offset by a huge positive movement in the trade balance, due to a falling Canadian dollar and raw material exports:

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Since we can’t all devalue and move into trade surplus, this meant that the Canadian story in the 1990s had no relevance at all to the austerity debate of 2010.

Also, the whole debate about austerity versus stimulus was driven by the problem that interest rates were at the zero lower bound, so that there wasn’t any easy way to offset the effects of austerity. Canada in the 1990s? Not so much:

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However, Josh misses a trick. When dealing with right-wing claims about economic data, you should never forget Moore’s Law: not only shouldn’t you accept their assertions, you should assume that what they say is probably wrong. Barro:

Squeezed by high interest rates, a left-of-center government instituted big spending cuts in the 1990s; as a result, Canada’s level of public expenditure as a share of its economy has fallen to match America’s.

From the IMF database:

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The gap between Canadian and US spending narrowed during the recession, because the recession was far worse in the US. This meant that any given level of spending was larger as a share of GDP, and it also led to a temporary spike in US spending, mainly on unemployment insurance and other safety net programs, but also briefly on stimulus. But that’s all in the past, and we are once again back to the normal situation in which Canadian spending as a share of GDP is quite a lot higher than ours — including much more spending on poverty reduction.

So conservatives have fallen in love with an imaginary Canada, whose history and current reality is nothing like the real place. Are you surprised?