Good article, thanks for posting. I've addressed this in the past. People would say "Well, if we have a serious downturn, I'll just cut spending a bit, who wouldn't?" - as if it were that simple. It's not.
A simple summary of that article to consider: The kind of downturn that results in failures is a ~ 50% reduction in the early years. Now does it really make sense that cutting spending from say 4% to 2% for a few years is going to have much effect compared to that 50% dip?
I've actually modeled that in FIRECalc, the results are probably in some earlier threads, but it was clear it took a long and severe cut in spending to be able to pull a failure to success.
The second problem is what if he have a deep dip, but a quick recovery like in 2008? Do you cut right away for a few years, and miss out on what could be once-in-a-lifetime opportunities, just to find your portfolio recovered just fine, and you can never get that opportunity back again? And if you wait a few years, will it be too late?
Yes, "I'll just cut back" is a gross oversimplification, with serious quality-of-life issues, and not likely to be effective.
-ERD50