Millions are no doubt wondering how we know that the government has to reduce deficits by $4 trillion over the next decade. This appears to be the magic number that underlies the budget discussions between President Obama and the Republicans in Congress, and it is widely accepted by Serious People everywhere, but where did this magic number come from?
|By: Dean Baker Tuesday November 27, 2012 6:11 am|
|By: Peterr Saturday November 24, 2012 9:00 am|
Like little children scared about monsters under their beds, DC appears to be in thrall to fears of Invisible Bond Vigilantes. Krugman has been trying to slay these fears with logic and rational argument, but as any parent can tell you, fears like these are irrational and succumb to only one thing: mockery.
As the pressure for a Grand Bargain mounts and screaming about the Invisible Bond Vigilantes rises, let the mockery begin. It’s the only weapon that has a chance of success.
|By: letsgetitdone Saturday November 24, 2012 7:52 am|
Obama for America, the campaign apparatus with the very large e-mailing list and great segmentation techniques that exploited Romney’s weaknesses to help the President to eke out (yes, I know the electoral vote involved no “eking out,” but the popular vote was something else again) his re-election victory, is now trying to mobilize people who voted for the President to work against their own interests by supporting his deficit/debt cutting activities. So, I couldn’t resist the following commentary on their mobilization e-mail.
|By: Jon Walker Wednesday November 21, 2012 1:10 pm|
Goldman Sachs CEO Lloyd Blankfein calling for Social Security and Medicare spending to be “contained.”
|By: Jon Walker Tuesday November 20, 2012 8:55 am|
It is amazing to watch how desperate some of the so-called “deficit hawks” are to cut Social Security and Medicare. Peter Diamond wants to see these programs cut so badly that he is effectively advocating we sacrifice the core principles of democracy just to make it happen.
|By: letsgetitdone Friday November 16, 2012 4:31 pm|
Like many others, I’m not worried about the so-called fiscal “cliff,” and the ravages to the economy that are likely to occur if Congress doesn’t do something about it before the end of the year. That’s because a lot of the impact can be cushioned in the short run by Executive Branch manipulations while negotiations continue to go on. But if measures aren’t taken to reverse the contractionary effect of the sequestration-induced changes, we’re looking at deficit cuts of $487 Billion over 9 months of the fiscal year.
By comparison, the American Recovery and Reinvestment (ARRA) of 2009 produced only $350 B in stimulus during its first year. And, if the full sequestration were allowed to proceed unmodified, then it would result in a “claw-back” of about 60% of the total ARRA stimulus.
|By: Dean Baker Tuesday November 13, 2012 12:19 pm|
It’s so cute to see all the serious people like David Brooks who are so worried about economic crises that do not exist. They are constantly telling us how the “job creators” (a.k.a. rich people) who run businesses are just so nervous and uncertain they don’t know what to do. The current concern is that taxes could rise at the end of the year and government spending will fall.
|By: letsgetitdone Sunday November 11, 2012 1:00 pm|
Many Modern Monetary Theory posts and other writings on fiscal responsibility, including my own, focus on the myths of neoliberalism, pointing out why they are myths and developing an alternative MMT perspective in some detail. Off hand, and I may have forgotten something, I couldn’t think of a brief positive MMT narrative related to fiscal responsibility containing primarily the truths, rather than the myths.
So, here’s my version, revised after calling for and receiving comments from readers at New Economic Perspectives, Correntewire, FireDogLake, DailyKos, and ourfuture.org. Thanks to Tadit Anderson, Mitch Shapiro, Nihat, James M., Marvin Sussman, joebhed, Clonal Antibody, Ed Seedhouse, JonF, Lyle, Thornton Parker, Sean, Golfer1john, Rodger Malcolm Mitchell, econobuzz, Lambert Strether, maltheopia, Ian S., for contributing significantly to the critical evaluation of the earlier version.
|By: Attaturk Tuesday October 9, 2012 1:30 am|
So this means we do not have to enact those profoundly harmful austerity measures with cuts to entitlements that target the poor and elderly right?
|By: Kay Tillow Sunday October 7, 2012 8:35 am|
After the November election, there will be a major effort in Congress to pass a budget deal that will make cuts in Social Security, raise the Medicare and Social Security eligibility age, and perhaps more–unless we act to stop it with a solution that is close at hand.
There is agreement from the Wall Street Journal’s David Wessel to liberal economists Dean Baker and Paul Krugman that the pressure will be on to reach a Simpson/Bowles type of compromise. Such a bipartisan plan would damage our most cherished programs and excuse the dastardly deed by asserting that the cuts are small and necessary because of the deficit.