The Science of Public Economy Under Criticism as the Basis for Decisions on Economic Policy

Already since the time more than six years ago when the banking and financial crises started which led to the catastrophic expansion of public debt in the main industrial countries, the postulates of public economy and the resulting conclusions drawn in the field of economic policy for the solution of topical problems have been increasingly questioned. Researchers of public economy are having increasingly heated discussions on the pragmatic solutions for exiting the debt crisis. Is it primarily important to reduce the state budget deficit with the final goal of achieving a tolerable debt burden level? Or should the state expenditures be increased and consequently primarily an increase in public debt be allowed to stimulate demand, production and economic growth in national economy? In the case of the second alternative described, it would be easier to reduce public debt though increasing tax revenues