Let’s look at some of the fallacies this Greek gentleman has written,
laying aside the fact the Greek economy is a total mess:First he
claims it’s his MODELS showing the deficit should be increased. MODELS???
The sophisticated models used by AGI and much of the financial world were a
significant part of the barney-frank induced housing bubble, the collapse of
which took our economy down.He goes on to say without a stimulus, we
cannot expect an employment lift. When slick willy took office he proposed a
modest $50B stimulus, but could not get it through congress. The economy did
just fine without it. Bush tried a $100B stimulus in early 2008 and it failed.
BO’s massive porkulus failed. Stimuli do not work.He says
slower government spending is another reason post-recession growth has been
slow. Government spending has INCREASED EVERY YEAR under BO! The only
“slowing” has been in the amount of increase in spending (besides
job creation, hampered by BO’s anti-private sector policies and
How can the deficit be shrinking when the number keeps growing? The notion is
counter intuitive. To us non-economists, spending more than you take in on a
long-term basis looks like a recipe for disaster.
Excellent editorial. Spot-on. This is macro-economics 101; spend to promote
growth, then with the economy humming along, then worry about debt.
Eat drink and be merry for tomorrow we will die(worry about the debt). The
recipe for disaster! Sounds exactly like what Cyprus, Greece, Spain and other
counties in Europe have done. Oh, but we are different, right?
The tea party island is shrinking fast. Will be easy to yell and throw tea when
the water is knee high.
Why do the recoveries of today look different than in years past? Could it be
that we are already so saddled with debt that the those in the business world
fear to expand their business into a failing situation? Perhaps the big
difference is that the debt itself is so large it drags on the economy.
Increasing that debt will slow things even more.
First of all, I'm going to faint (I can't believe the Dn even printed
this)! This is not "eat, drink, and be merry", this is being flexible
and smart which is good leadership whether in business or government.
DeepintheHeart:You confuse deficit with debt. The deficit is indeed
decreasing. Overall debt will increase as long as there is a deficit.But this editorial is correct. And the GOP economic mythology is as irrational
as anything we've seen in decades. What we need to do, though, in addition
to deficit spending during downturns is to increase tax revenue during economic
booms. This is the other half of the equation that Republicans cannot
understand, and it is the reason our debt is out of control.
Re: "Just 6 percent (6!) of respondents in a recent poll correctly stated
that [the deficit] had been shrinking . . . ."Yeah -- shrinking
from 40+% all the way down to 36.8% of current expenditures.The
public could well be forgiven for such an error. Point being, the deficit is
still WAY too high. And the Obama regime is still making noises to the effect
that being WAY too high is no big deal, with it's captive economists even
suggesting that a 20% deficit is somehow sustainable in the long term.What the economy actually needs is LESS competition for capital between the
private sector and sovereigns. That's the ONLY way to genuinely stimulate
growth of the private sector. And yes, such private sector growth would come at
the expense of the government's deranged and expolosive expansion, but real
people can't be expected to genuinenly mourn such a development.
Didn't Obama already attempt this and called it the "stimulus
package"? The definition of insanity is to keep doing the same thing
expecting different results.
"How can the deficit be shrinking when the number keeps growing?"One more example of the ignorance from the right.There is a
difference between deficit and debt. Use Google, it is a marvelous
tool. Or take a basic civics class. It's pretty simple.And then
these very same folks act as if they know what's best for the economy,
guns, health care, and education??? They act like they're Constitutional
scholars? No wonder our country is in the state that it's in!
This letter is deeply troubling. The writer would have us look to government
for solutions of government generated problems. Have we lost our mind? Does
anyone who pays taxes trust Washington's use of their tax dollars? Does
anyone who has read the Constitution agree that Washington has the right to
redistribute wealth, to seize your assets simply because you worked harder and
earned more than someone else? How does taking from the "rich guy" make
him want to work harder and to employ more people?
Economics should be prerequisite for commenting on money supply in context of
international economy. Otherwise writers should preface comments with "lets
go back to the twenties".
Mtnmn:Yes, this is what Obama did with the stimulus, and it worked.
It just didn't work well enough, because the stimulus was too small for the
size of the mess we were in. And 4word Thinker, there are several
reasons why our recessions look different today than they did 30 years ago. One
significant reason that is ignored by most economists and all politicians is
that businesses, instead of hiring American workers when things start to
improve, either pocket the profit that was created by forcing the rest of the
work force to be more productive or hire Indonesians, Bangladeshis, and
Vietnamese to do work Americans used to do. When corporations are hauling in
record profits but are not hiring Americans, it is not because they cannot
afford to.Productivity is seen by businesses as a panacea, but for
the average worker, productivity improvement means one thing: less job security.
When workers are more productive, businesses can get by with fewer of them,
which is one reason why our economy is dominated now by services and financial
shenanigans. A service-based economy simply cannot thrive in the long run.
@DeepintheHeart"How can the deficit be shrinking when the number keeps
growing?"National debt is increasing. The deficit is the number
just for the year. Since it went from around 1.4 trillion for 2009 to around 1.1
trillion for 2012 and projected to be 900 billion for 2013 yes the national debt
is still rising, but the deficit is actually falling at the fastest rate in over
half a century.
People tend to confuse the "deficit" with the federal debt, and because
of this confusion, respondents say it is getting bigger. My first take on this
headline was that these experts are morons, but after some reflection I can see
what bigger deficits could lead to a more speedy recovery, but only if the
deficit increased because of leaving more resources in the hands of job creators
(and I am not talking about the government, which should not be the employer of
last resort). "Those who understand interest, collect it; those who
don't, pay it." HJG From this we may learn that debt is not a
positive unless you are the creditor; not the debtor.
Mike Richards:I hate to break it to you, but evidently everyone here
agrees it's OK for the federal government to take money from some people
and give it to others, as you put it. How's that? Well,
we're using the Internet on this electronic web site, which began it's
existence as a federal research project, money forcefully taken from the
successful and given to universities to research - gasp! - how to make computers
communicate with each other.So, you really should be writing your
opinions on paper with pencil, and handing them out to people on the street,
because this medium we participate in is ill-gotten, by definition. We're
all complicit in this massive theft.Do you feel badly about that?
Somehow, I don't. Actually, I think the Internet has been a tremendous
economic spur, has helped increase access to wide amounts of information we
wouldn't have been able to as easily access without it.
If this year I spend 120% more than I madeBut last year I spent 130% more
than I made And two years ago I spent 140% more than what I madeMy
deficits have decreased But it is still economic insanity because the
debt is growing every year. And as the author admits – deficits do
not work to stimulate job growth like they once did.
@10CC,Read Article I, Section 8. How many times in that Section is
Congress allowed to tax us to maintain the military? Do you have
any idea of the purpose of DARPA? For that matter, do you have any idea why we
have an Interstate Highway system? It was all military related. Just was we
now have roads to drive on because we were willing to spend defense dollars
developing a system that allowed the military to travel from coast to coast in
the minimum time possible, we also have the Internet which is PRIVATELY funded
having been built using transmission protocols developed by ARPANET which was
part of DARPA. Citizens authorized the basic funding for those
projects because of our need to defend ourselves and to move people and
information quickly if attacked. Just as commercial aviation learned from
military aviation, those of us who provide Internet connections to others
understand that military funding can benefit us in non-military ways. The Internet was not developed by nor is it owned by the government.
Government funded studies for packet switching which is part of the TCP/IP
protocol used to transmit information.
Counter Intelligence: See my comment above. Our debt is increasing
only because we decrease taxes during economic booms instead of increasing them.
Oh, and because we start unfunded wars and refuse to pay for big Medicare drug
programs. But that's another topic.Mike:Really,
what you need to do is go off to some corner of Canada where no one will find
you and start a country based on your interpretation of the Constitution. Then
you can live happily in your little 1787 utopia. Everyone can have all the guns
they want, there will be no government involvement in health care, and nobody
will have to pay taxes. We wish you well.
Mr. DeForest,What I would like to say would never be printed in a
family newspaper. If Mr. Richards did as you suggested, Canada would be
infinitely better off and America would loose one of its true patriots, while
you would remain here to hurl your insults and pretend that anyone cares. Mr.
Richards and others like him know more about what this country is about and what
makes it great than you will ever know simply because you seem to believe your
own posts instead of reading our founding documents. There are so many like you
who hang on to every word that slips out of the lips of those who bash the
Constitution and then you and they sling insults at anyone who reminds us that
there are limits on government.America is in a mess because people
put themselves above the Constitution. Some of you seem to see nothing wrong
with a lawless society where shouting mobs rule as they ignore our laws and
I have a number of problems with this column. First of all I disagree with the
notion that deficits in and of themselves increase employment. What's the
rationale behind that? I can understand if you're running deficits because
you're giving tax breaks to natural gas producers and employment goes up in
that industry- that would make sense. Look at the first stimulus of this
recession - the Bush Pelosi tax rebate- how much did that help? If you're
spending money but not increasing productivity then you may as well burn the
money (which is essentially what we've done). I also don't like
the way the writer clowned Americans for not knowing deficits have been
decreasing. What difference does it make if they are decreasing if they are
decreasing off an astronomical number that he never mentions? We had a deficit
of over a trillion and now it's 980 billion. Who cares? Lastly- I
have a model too- it says that because of Obamacare taxes many capital gains
were realized and dividends paid out in 2012 to avoid Obamacare taxes- hence the
increased tax revenue. It's actually not a "model" - it's
I also caution that austerity isn't the answer either. Most of the job
losses have been actually in the public sector as we "cut" and what not,
more so happening at the state and local level--this is a given. But all this
cutting and such leads to unemployment because when we are talking about cutting
we are talking about laying off people. This has ripple effects through the
economy. At the same time the debt must be addressed. I am with
Eric Samuelson. Let's work on getting the economy humming which might
require some government spending, I look at it as an investment. The private
sector, for whatever reason. has not stepped up. But I think there are plenty
of good ideas to invest in like infrastructure (roads, bridges, electronic grid,
sewage systems, schools and more teachers) that have been ignored or even cut
that are in dire need of attention. I actually think some of the FDR's
programs worked like the TVA for instance, again the private sector worked well
with the government there and these partnerships need to be developed.Once people are employed, increased tax revenue reduces the debt.
Dimitri B. Papdimitriou seems to be well versed in the Greek economic paradigm,
but not their results. If more money is needed to create jobs, cut federal taxes
so we will have more consumer spending. States can raise taxes to create jobs
where they are needed. The perverse notion that sending money to our congress to
spend is the most reliable and efficient way to stimulate the economy is indeed
Macro economics 101. Translating that Keynesian religion from the classroom and
textbook into practice has been less than reliable. Just as war is too important
to be left to the generals, maybe our economy is too important to be left to the
To "Kent C. DeForrest" you are wrong. Our debt is increasing because we
are spending more money than ever before. Since Obama took office we have been
spending nearly $1 Trillion more each year than under Bush. In more simple
terms, spending under Bush was 19.9% GDP. Under Obama that has grown to 24.17%
GPD. It isn't the mythical unfunded items, it is simple and straight up
spending.The numbers point to spending.If you want to
discuss unfunded spending, you should actually look at Obama and his spending.
He has kept us at war, he cut Medicare, and has added the ACA wich will cost the
US $2.7 Trillion (3 times the original estimate).
re: L White 4:43 p.m. April 9"If Mr. Richards did as you
suggested, Canada would be infinitely better off and America would loose one of
its true patriots," That is a chance I'm willing to take.
Just think, MR could call his dystopia Pleasantville. Oh, wait..."Mr. Richards and others like him know more about what this country is
about and what makes it great than you will ever know..." Are
you indirectly including yourself? "America is in a mess because
people put themselves above the Constitution."How exactly does
the COTUS start? The COTUS is a fluid document which is great IMO as
conditions and mindsets have changed in the last 226 yrs.