By Joe Firestone
The Peterson Foundation reacted to the President’s budget document with a report repeating its usual whining about the debt problem, and the need to cut entitlements. Here are quotations from the report and my explanations of why they are ridiculous deficit/debt terrorist nonsense.
While today’s deficits are much lower than those during the financial crisis and recession, over the next ten years debt will remain at historically high levels under the policies outlined in the President’s budget. Over the long term, our debt is on a rising and unsustainable path that harms our economy and threatens our future standard of living.
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Tagged CBO projections, debt, deficit solvency, Fiscal Policy, Fiscal Responsibility, fiscal sustainablity, High Value Platinum Coin Seigniorage, HVPCS, interest rates, OMB projections, peterson, Peterson Foundation, President Obama's 2015 budget
By William K. Black
In the course of researching yesterday’s column that explains why Tyler Cowen’s faux “hyper-meritocracy” endangers our world I read a number of articles discussing the Northwestern University study on the public policy views of the wealthy. One of those columns was published by UPI on February 24, 2013.
One of the central points that the scholars who conducted the study made was that the wealthy use their political clout to try to cause the American public to adopt the belief of the wealthy that reducing the federal budget deficit, in response to the Great Recession, was the most important problem facing America. In my column yesterday I noted that the scholars pointed out the logical incoherence of that position given the wealthy’s strong support for the policy view that the federal government should run budget deficits as a counter-cyclical fiscal policy to a recession.
By Michael Hudson
(Remarks by Prof. Michael Hudson at The Atlantic’s Economy Summit, Washington DC, Wednesday, March 13, 2013)
There are two quite different perspectives in the set of speeches at this conference. Many on our morning panels – Steve Keen, William Greider, and earlier Yves Smith and Robert Kuttner – have warned about the economy being strapped by debt. The debt we are talking about is private-sector debt. But most officials this afternoon focus on government debt and budget deficits as the problem – especially social spending such as Social Security, not bailouts to the banks and Federal Reserve credit to re-inflate prices for real estate, stocks and bonds.
By Marshall Auerback
The lamentable state of American political parties has become common sport amongst the chattering classes in DC and beyond. Although, one wonders whether this dysfunction has really been such a bad thing, when considering how united bipartisan “responsible” action always seems to result in yet more budget cuts.
By virtue of the fact that Congress and the Obama Administration couldn’t agree on much for the past few years, America’s deficits got large enough to put a floor on demand. The transfer payments via the automatic stabilisers worked to stabilise private sector incomes and allowed a general, albeit tepid, recovery in the economy.
L. Randall Wray recently presented at the Steinhardt Lecture at Lewis & Clark College in Oregon. The title of his presentation was: “Fiscal Cliffs, Debt Limits, and Unsustainable Deficits: Can the US Really Run Out of Dollars?”
The video and matching slide presentation are provided below. Media Roots created a transcript of the presentation. You can access it via this link. Continue reading
By L. Randall Wray
In yesterday’s NY Times, Nobel winner Robert Solow tackled the US debt debate, proclaiming that while it is a serious issue, many Americans are not aware of the facts.
Solow is a “neoclassical synthesis” Keynesian, the type of Keynesian economics that used to be taught in the textbooks. He was also on the wrong side of the “Cambridge controversy,” as the main developer of neoclassical growth theory. Still, he’s often on the “right side” when it comes to macro policy questions. And at least part of what he says about the US national debt is on the right track. But he gets enough confused that it is worthwhile to correct the errors.