Tag: deficit

Another reality check on spending and deficits

March 18, 2013 at 8:25 amCategory:Uncategorized

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Dean BakerOne of the country’s keenest economic policy observers, Dean Baker, has an excellent take down of Washington Post columnist Robert Samuelson’s latest demands that the U.S. slash social spending this morning at the Center for Economic and Policy Research website. His message: America’s obsession with near-term deficits remains utterly illogical and counterproductive: 

“First, the budget is only constrained at the moment by superstition. There is no obstacle to the government borrowing more money to meet needs and put people back to work. We are not spending more money because we have superstitious people with large amounts of power who are making claims about the dangers of deficits that they cannot support with evidence. Rather than lecturing seniors, who have a median income of $20,000, on the need for lower Social Security and Medicare benefits, Obama could try to confront the people spreading superstitions about deficits….

…In fact, according to the Social Security Trustees projections, Read More…

America’s deficit attention disorder

August 13, 2012 at 11:36 amCategory:Uncategorized

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Author and thinker Dr. David Korten has a worth-reading post this morning at Common Dreams. This is the intro:

“The political debate in the United States and Europe has focused attention on public financial deficits and how best to resolve them. Tragically, the debate largely ignores the deficits that most endanger our future.

In the United States, as Republican deficit hawks tell the story, ‘America is broke. We must cut government spending on social programs we cannot afford. And we must lower taxes on Wall Street job creators so they can invest to get the economy growing, create new jobs, increase total tax revenues, and eliminate the deficit.’

Democrats respond, ‘Yes, we’re pretty broke, but the answer is to raise taxes on Wall Street looters to pay for government spending that primes the economic pump by putting people to work building critical infrastructure and performing essential public services. This puts money in people’s pockets to spend on private sector goods and services and is our best hope to grow the economy.’

Democrats have the better side of the argument, but both sides have it wrong on two key points. Read More…

The Big Picture on the Obama Administration’s 2013 Budget

February 13, 2012 at 4:45 pmCategory:Uncategorized

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If you’re looking for an insightful, big-picture overview of the Obama administration’s 2013 budget plan, you would be hard-pressed to find a better place to start than a statement released this afternoon by the President of the Center on Budget and Policy Priorities, Robert Greenstein.

Greenstein’s statement makes a key point that should put to rest some of the deficit hysteria that’s already accompanied the release of the new budget plan:  the Obama administration’s budget would stabilize the federal debt over the next decade through a balanced mix of spending reductions and additional revenues.

The whole statement is worth reading, but here are the top-line messages:

The President’s budget would, if enacted, make significant progress in reducing deficits, although policymakers would have to take further steps, especially for future decades.  Under its economic assumptions, it would achieve what most budget analysts, and all recent bipartisan commissions or panels, have identified as the crucial fiscal goal for the decade ahead — stabilizing the debt so that it no longer rises faster than the economy. Read More…

Some important truths about the federal deficit

December 13, 2011 at 12:01 pmCategory:Uncategorized

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Economist Dean Baker has a fascinating post at the CEPR blog entitled “A Tale of Two Deficit Charts.” In it, he explains how both Repubs and Dems have been guilty of promoting misleading stories on the origins and future of the federal deficit. The real culprit, Baker argues persuasively, was/is the collapse of the economy that was precipitated by the bursting of the housing bubble.

 Here is the excellent conclusion: Read More…

The real cause of the federal deficit

November 23, 2011 at 9:29 amCategory:Uncategorized

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This morning’s “must read” is this post by economist Dean Baker.

The final paragraph, in particular, is worth ruminating on:

“In reality, both left and right can agree that the broken U.S. health care system is the problem. The United States already pays more than twice as much per person as the average in other wealthy countries. If our per person health care costs were the same as those in Canada, Germany or any other wealthy country, we would be looking at huge budget surpluses, not deficits.” 

In other words, while the President has certainly made some errors during the last three years — not pushing for a large enough stimulus right from the beginning comes to mind — he was  clearly right in his initial assessment that the U.S. has to  make health care reform a (if not the) top priority. Would that he could have promoted a Canadian or German-style system.