Debt vs. Growth

I first saw this a couple days ago, but forgot about it.  And I still need to look at more closely.  It seems that a highly cited paper from 2010 has been used to justify government austerity--that large debt stifles growth.  But a new paper disputes some the methodology and uncovered an Excel coding error that reverses the conclusion of the original paper.  Funny how the numbers can turn on you like that.

Update (April 22):  Follow up articles:  Using bad data, economics isn't an exact science, and Thomas Herndon is the graduate student who caught the Excel error.

Update (April 26):  Links to the original authors' responses and Krugman's take.  Also Colbert.

Update (April 30):  Austerity is a failure.