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If the government fails to keep spending when the economy is weak, especially on core safety-net issues, it will only worsen unemployment and impede the chances of recovery.
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While overall state spending continues to increase year after year, state aid to municipalities fails to keep pace with rising costs.
It also needs consumers to keep spending.
Bigger paychecks helped to keep spending strong.
And those companies expect consumers to keep spending.
The Museum of Contemporary Art has run into increasingly difficult financial straits in recent years as its fund-raising has failed to keep up with its spending.
As wages have failed to keep pace, first-timers now spend 17.8% of their income on their mortgage, but with interest rate rises expected, that will spiral with troubling consequences.
The data indicates consumers are relying more on credit to sustain spending as income gains fail to keep up with inflation and as home prices drop.
Each year's cuts will be more painful than the last because the spending limits fail to keep pace with population growth, inflation and the needs of the economy.
They failed to keep pace with the surge in spending despite being boosted by buoyant revenues from a booming financial sector and frothy property markets (see chart 2).From that starting-point of a £35 billion deficit in 2007-08, borrowing has soared to a predicted £175 billion ($290 billion) in 2009-10.
Economists worry that stagnant incomes, which have failed to keep up with inflation, will continue to impede spending even though fuel prices are starting to fall.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com