Why did Zapatero deny the looming economic crisis and introduce a 400€ tax cut in 2008?

He and his economic advisors were unable to predict the crisis that would ensue.
0% (0 votes)
He downplayed what he believed to be a temporary downturn to maximise the effectiveness of his counter-cyclical fiscal policy.
2% (1 vote)
He just lied to justify a fiscal policy designed to temporarily boost the economy and his re-election chances.
98% (41 votes)
Total votes: 42
Learning objectives: 
Introduction to fiscal policy.
Introduction to rational expectations and the policy ineffectiveness proposition.
Introduction to Ricardian equivalence.
Introduction to the concept of noble lie.
Introduction to public choice and the political business cycle.
Presentation videos: