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Deficit is set to heal itself

POSTED BY: KPO
UPDATED: Thursday, April 5, 2012 07:49
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Thursday, April 5, 2012 7:14 AM

KPO

Sometimes you own the libs. Sometimes, the libs own you.


Ezra Klein:

Quote:


That’s not because we don’t have to get the problem under control; it’s because I’m pretty sure we will. Why? The budget deficit is unique: If Congress is unable to agree on a remedy, the problem goes away on its own. Would that all of our challenges were so cooperative.

Federal Reserve Chairman Ben S. Bernanke calls the end of 2012 “a fiscal cliff.” The Bush tax cuts are set to expire. The $1.2 trillion spending sequester, enforcing cuts in the defense and domestic budgets, is set to go off. Various stimulus measures -- including the payroll tax cut -- are scheduled to end. “Taken together,” writes the Committee for a Responsible Federal Budget, “these policies would reduce ten-year deficits by over $6.8 trillion relative to realistic current policy projections -- enough to put the debt on a sharp downward path.”

In fact, if Congress gridlocks -- and what does Congress do these days but gridlock? -- we face the prospect of too much deficit reduction too fast. The Congressional Budget Office estimates that barreling over the fiscal cliff would increase unemployment by 1.1 percent in 2013.



Quote:

Nevertheless, I’m confident that we will, one way or another, muddle through. Because when it comes to the deficit, Congress really has two choices: Do something to solve it, or do nothing and let that solve it. The same can’t be said for issues such as infrastructure and loose nukes and climate change and preparing for pandemic flu. On those questions, congressional inaction isn’t enough to make the problem disappear. So those are the issues I worry about.


Article here: http://www.bloomberg.com/news/2012-04-04/don-t-worry-about-deficit-tha
t-will-heal-itself.html

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Thursday, April 5, 2012 7:49 AM

NIKI2

Gettin' old, but still a hippie at heart...


Yup. Not to mention what it will do to us as a country if all the cuts of the Ryan budget go through... THAT should be fun!



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