But this isn't true.
Here are five other ways we could deal with our current financial situation, and some of the people fighting to get them recognition.
And after you've read this, be sure to check out False Economy for MUCH more information and plenty of ways to get involved with the alternatives!
We've only just come out of recession, and growth is weak.
About 1 in 5 of our workforce are in the public sector, and if they lose their jobs, they stop spending, their local shop goes out of business, the government loses their income tax and VAT and if there aren't enough private-sector jobs to pick up the slack the economy grinds to a halt.
This is Key Stage 2 economics.
Thatcher tried to cut her way out of recession in 1979 and made the economic situation much worse. Even amongst those that think massive cuts are necessary, the sane ones (like these 60 economists) think we should cut later, when growth is stronger.
How much do we need to cut? How much debt can we sustain? That depends on a whole set of factors, but Britain still has the fifth largest economy in the world and the third largest reserve currency – we're really in no danger of losing our AAA credit rating.
And since most of our debt is owed internally (to British pension companies) we're not going to end up like Greece with foreign banks determining our economic future. Economics involves a lot of guesswork, and predictions can end up being self-fulfilling prophecies.
Right now, the government are talking our economy down, decreasing our predicted growth and making deeper cuts necessary. We do have a large deficit, but we don't have a life-threatening hole in our finances. The scale of the cuts they want to push through is motivated by ideology as much as economics.
That's not to say that all public spending is good spending.
In fact, some of it is actually quite evil, like the £888m a year in subsidies we give to the arms trade , or the £6 bn a year we're about to sign away to replace our nuclear warheads.
ID cards were pretty stupid, so well done to the coalition for cutting that, and scrapping the third runway too. Why not stop the widening of the M25 as well, or subsidising the airline and oil industries with huge tax breaks?
Well, they couldn't really do it much worse - the UK has one of the most regressive tax systems in Europe.
Here's a smart idea: a tiny 'Robin Hood' tax on financial transactions that will stop stock brokers destroying whole currencies and will raise billions a year to fund schools and hospitals and youth centres.
Raising the top band of income tax from 40% to 60% (the level it was at under Thatcher) would raise £19bn a year, while a one-off 10% levy on the £77bn in profits that the richest 1000 Brits made last year would raise £7.7bn – enough to stop all the cuts they're proposing this year. The super-rich won't even notice the difference, but the other 61 million of us certainly will.
We can dream. If we're honest, a Conservative government is unlikely to bring in a more progressive system in the next five years, but we could at least get rich people to pay the £95bn in taxes they dodge every single year, and close down the tax havens they use to do so.
When we spend money on public services we're not throwing money away – we're investing in people so those people can play a role in making our society function.
Without education, people can't do skilled jobs. Without healthcare, people get sick and become unable to work. It's way more expensive to put kids and drug addicts in jail than to run youth centres and treatment programmes. If we cut the services that help people to become independent and productive members of society then we could end up having to support them forever. That would cost loads.
Right now, the most highly educated generation in Britain's history is ending up in the dole queue because there are no jobs – and meanwhile, the environment is falling apart, and it's only a matter of time before another financial crisis wallops us.
Fortunately, by investing in a Green New Deal we can tackle all three problems: diversifying our economy away from the financial services, getting young people into work, and moving towards a low carbon economy.
Or why not start up a Green Investment Bank to invest in and clean up our banking sector at the same time as building a green economy?
We can't rely on the private sector – investment needs to start now, it needs to continue long term, and what we really can't afford is another £1.4 trillion to bail them out if they mess it up.