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Tax Reform, version 2.0 vote this month ??? Elections anyone ???
Well, why not? A politicians friend and vote grabber is easy enough with "OPM", being other peoples money and in this case the "OPM" is the National Debt, eh?
Well, why not? A politicians friend and vote grabber is easy enough with "OPM", being other peoples money and in this case the "OPM" is the National Debt, eh?
Ya, its been posted here before; but.....Debt Clock.
Sleep tight and don't let the markets bite. Catch
I'll say it again. Everyone's afraid to do it so it probably will never get done (it's almost a guarantee politicians will lose their seats), but Entitlement Reform.
Everybody's in favor of Entitlement Reform... for everyone other than themselves, of course. But then again, that perspective is shared right up to the very top, in fact, especially at the very top... that elusive "1%", who are leading by example. Of course they're entitled to it... after all, they're contributing ever so much more than everyone else.
Why should anyone be surprised that the 99% feel the same way?
Everybody's in favor of Entitlement Reform... for everyone other than themselves, of course. But then again, that perspective is shared right up to the very top, in fact, especially at the very top... that elusive "1%", who are leading by example. Of course they're entitled to it... after all, they're contributing ever so much more than everyone else.
Why should anyone be surprised that the 99% feel the same way?
What world are you living in? If everybody were in favor of entitlement reform it would get done tomorrow.
The real one. But of course everyone is, as long as it doesn't affect them.
All I know is they'd make this whole debt clock problem a lot less of an issue. You honestly can't deny that or would that not be the case in your so called "real" world.
Krugman starts off in his first paragraph by asserting that "he [Stiglitz] accused Larry [Sommers] of inventing the doctrine [of secular stagnation]". Krugman says that this was in "The debate between Joe Stiglitz and Larry Summers over secular stagnation."
Yet on that page that Krugman linked to, the first writing, which is by Stiglitz, has as its very first sentence: "In the aftermath of the 2008 financial crisis, some economists argued that the United States, and perhaps the global economy, was suffering from “secular stagnation,” an idea first conceived in the aftermath of the Great Depression."
Maybe you interpret "conceived" and "invented" as having different meanings. Or perhaps "doctrine" and "idea" don't align in your mind. To me, it looks like Krugman is coming with an agenda (okay in an opinion piece, which this is), and that I should read the rest with a critical eye. (Krugman apparently preferred to quote Sommer's misrepresentation of Stiglitz than to present what Stiglitz actually wrote.)
Moving on to the debt ...
Krugman makes a subtle shift in his argument that the debt isn't important now. The flaw in his first formulation is not even especially subtle. Though he corrects it further down in his column, he also inserts a subjective qualifier then.
But this kind of debt spiral can only happen if the interest rate on the debt is higher than the economy’s growth rate.
Uncompacting this: Due to interest on the debt, the amount of debt grows. The rate of growth is the interest rate. So in a year, the debt is (1+r) times as high. So long as the economy (and presumably the budget) grows at a faster rate, then the debt is not growing as a fraction of the economy (or budget), so all is right with the world.
See the flaw? The debt is (1+r) times as high plus whatever else we pile onto it through deficits. Later, Krugman says as much:
[Debt] tends to fall as a share of GDP unless the government runs large primary deficits.
The insertion of the word "large" is supposed to reassure us, since he's giving ground on his original statement. But he never explains what large is, whether the current deficit (5% of the current debt, call it 2% primary) is large or not, and how fast this "large" buffer shrinks interest rates paid by the Treasury rise.
To a fair degree, I agree with the conclusion that there are more important things right now to worry about than the debt, but gee, there's got to be a less deceptive explanation than that. While Krugman may be sanguine about the debt not growing as a percentage of GDP, the CBO is not so confident: "CBO notes that by 2028, the debt held by the public will be at the highest level (as a percent of the U.S. economy) since World War II." https://www.washingtonpost.com/news/wonk/wp/2018/04/09/why-americas-return-to-1-trillion-deficits-is-a-big-problem-for-you/
I'm still paying for it... I just don't believe it's sustainable so am not going to assume I'm going to see any of it come back to me. Banking on receiving SS is a terrible way to plan for your retirement years.
Comments
Why should anyone be surprised that the 99% feel the same way?
https://www.nytimes.com/2018/09/11/opinion/on-the-debt-non-spiral.html
Yet on that page that Krugman linked to, the first writing, which is by Stiglitz, has as its very first sentence: "In the aftermath of the 2008 financial crisis, some economists argued that the United States, and perhaps the global economy, was suffering from “secular stagnation,” an idea first conceived in the aftermath of the Great Depression."
Maybe you interpret "conceived" and "invented" as having different meanings. Or perhaps "doctrine" and "idea" don't align in your mind. To me, it looks like Krugman is coming with an agenda (okay in an opinion piece, which this is), and that I should read the rest with a critical eye. (Krugman apparently preferred to quote Sommer's misrepresentation of Stiglitz than to present what Stiglitz actually wrote.)
Moving on to the debt ...
Krugman makes a subtle shift in his argument that the debt isn't important now. The flaw in his first formulation is not even especially subtle. Though he corrects it further down in his column, he also inserts a subjective qualifier then.Uncompacting this: Due to interest on the debt, the amount of debt grows. The rate of growth is the interest rate. So in a year, the debt is (1+r) times as high. So long as the economy (and presumably the budget) grows at a faster rate, then the debt is not growing as a fraction of the economy (or budget), so all is right with the world.
See the flaw? The debt is (1+r) times as high plus whatever else we pile onto it through deficits. Later, Krugman says as much: The insertion of the word "large" is supposed to reassure us, since he's giving ground on his original statement. But he never explains what large is, whether the current deficit (5% of the current debt, call it 2% primary) is large or not, and how fast this "large" buffer shrinks interest rates paid by the Treasury rise.
To a fair degree, I agree with the conclusion that there are more important things right now to worry about than the debt, but gee, there's got to be a less deceptive explanation than that. While Krugman may be sanguine about the debt not growing as a percentage of GDP, the CBO is not so confident: "CBO notes that by 2028, the debt held by the public will be at the highest level (as a percent of the U.S. economy) since World War II."
https://www.washingtonpost.com/news/wonk/wp/2018/04/09/why-americas-return-to-1-trillion-deficits-is-a-big-problem-for-you/
I'm still paying for it... I just don't believe it's sustainable so am not going to assume I'm going to see any of it come back to me. Banking on receiving SS is a terrible way to plan for your retirement years.