Monday, September 08, 2003

Brad DeLong channels Max Sawicky: GWB -- the American Argentinian

How Can I Be Out of Money? I Still Have More Checks: Archive Entry From Brad DeLong's Webjournal

Brad DeLong and Max Sawicky on the GWB deficit. See the article ...
... this fiscal year's (and next fiscal year's) deficit is fine: it's the deficit three, five, ten, twenty years down the pike that is really scary--and really damaging...

... the increase in debt as a share of GDP is bad fiscal policy. A feasible policy would restrict growth to the same rate as GDP, with a bump here and there to deal with recessions. With apologies to generalissimos and caudillos everywhere, George W. Bush is running a fiscal policy fit for a banana republic.

... AND ANOTHER THING: Last week I [DeLong] got a call from a reporter. The drift of her question was, does this defense increase bust the budget? No, not at all. The budget is already FUBAR.

... The astonishing thing is that Bush can so quickly have made the deficit so bad that you find yourself on the "hawk" side. As one prominent Washington figure has said, "It's amazing what this Bush administration has done to the budget. It's like being 8 runs up at the end of the eighth inning, yet finding yourself 12 runs behind in the middle of the ninth."

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