Frances says: The sequestor is clearly visible on this graph

As claimed by Frances Coppola.

The usual Keynesian crowd is jumping on Cochrane for trashing the Keynesians promise. Here is the law:

The Budget Control Act of 2011 (Pub.L. 112–25, S. 365, 125 Stat. 240, enacted August 2, 2011) is a federal statute in the United States that was signed into law by President Barack Obama on August 2, 2011. The Act brought conclusion to the United States debt-ceiling crisis of 2011, which had threatened to lead the United States into sovereign default on or around August 3, 2011.

The sequester would have an effect on  the Q1, 2012 growth number in the blue line.  We can see that the growth rate of the US economy continued right along its 2.3% trajectory starting in late 2011. Shortly after the sequester took hold we have a period of accelerated growth.

The flat line between 2010 and 2011 was definitely a result of crowding out by the stimulus as that is when oil shortages re-appeared and Illinois went into a double dip on unemployment.   When the stimulus was halted and the sequester took hold we have had three years of steady 2.2% growth, and now we are seeing 3-4% growth over the last three quarters, possibly because the QE stopped, we shall see.

Then there is Krugman's constant claim that we must have inflation, yet we have higher growth and less inflation.  In fact, less inflation and higher growth have been the norm since 1988. At least Frances was willing to show a chart, Noah Smith does no such thing, and he has no response at all.

Why didn't we reduce the deficit faster and get more growth sooner?  Government is slow.  Obama and the sequester was about the best we could do.

Compare Larry Summers at Treasury and his ability to reduce the deficit and then Jack Lew. I say Obama and Jack did a much better, faster job.  These numbers are old, and the deficit is now about 2.8% of GDP (I think), that is faster than anything achieved by any president since 1985.. So we can see that when Larry Summer, Brad Delong and Bill Clinton got the deficit down, then growth began for them, and now growth is beginning for Jack and Obama. Good for them.

So, yes indeed, the Keynesians are fraudulent and statistically incompetent.  It is impossible to reverse flow the national account data, and in the last 35 years we have no evidence that excess deficit spending did much more than crash the economy. The only evidence I have seen to support the Keynesians claim was poor statistical analysis by Cristina Romer. Frances Coppala proves himself to be a willing liar.