January 20, 2010

You've heard it from me...

...now you can hear it from an economist. Current deficits are not a problem and should be far larger. We're in a recession which results in lower taxes at the same time government is spending much more. In fact, it's criminal that the Democrats have allowed the blue dogs and every Republican to browbeat them into spending less than needed to pull the country out the economic abyss.

And yeah, cutting taxes ain't going to do the trick. Sorry. You're as dumb as Debra Medina if you think that. And no, I don't want to hear your theories on the Constitution.

But back to deficit and debt mania. Digby thinks it's all about hurting social security which is pretty accurate considering that it's all coming from the Petey Peterson Foundation which we talked about almost a year ago. Let me save you all a lot of worry and prep you for discussions you may have some of the, shall we say, ill-informed members of your family : we do not have trillions of future liabilities for social security and medicare/medicaid. The reality is that we have an actuarial hole in the funding because people are living longer and there are fewer workers supporting too many beneficiaries. You fix that by increasing the retirement age (which really should have been done 20 years ago) and then by repealing the tax cuts of the last ten years.

The reality of our economic situation is that it's not as dire or disastrous as Peterson and his folks would think. We're running deficits now because of a number of factors...some out of our control and right now deficits are not our biggest concern. It's the economy, stupid, and if we do what Peterson wants, we'll be in the economic toilet for a long time.

Posted by mcblogger at January 20, 2010 12:56 PM

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