Saturday, December 5, 2009

The Liability Con

Some enlightenment concerning recent deficit hysterics:

Baselines, Counterfactuals and the Stimulus
How I Learned to Stop Worrying and Love the Deficits
No Exit
Notes on the Dollar Panic
The Budget Deficit Crisis

The meme that deficit spending, always, crowds out private investment and is, in general, morally wrong, is both short-sighted and misleading. We are a country - private citizens, business, and government - that has used debt to live a better standard of life, grow companies, and finance operations, especially since WWII. During recessionary episodes, the government accumulates debt to restore employment, fix crumbling bridges, improve water and air quality, provide health care, etc. All quite worthy and important causes for investment.

This false debate about rates, deficits, and "big," "bad" government is deceptive drivel. Just more smoke and mirrors of class warfare. The rich in this country have slowly lowered their tax burden, frozen wages for laborers, and methodically steered more of the country's wealth toward their own pockets. As public money (which would have been used for public goods) finds it's way into private pockets, less of the public commons is maintained. We all end up worse off. As is evidenced by the continually decreasing standard of living for most Americans.

America Without a Middle Class
Household Debt Service
Poverty Facts and Stats
U.S. Business: The American Way of Debt

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