Yesterday, I was on Pete Dominick’s Sirius XM Satellite radio show (audio below). A caller asked about how to close the defici. His comments revealed that his concern about the deficit was merely a ruse, a tool to be used to achieve very different goals.
If you are truly concerned about deficit, then what you must do is (eventually) raise taxes and cut spending — that is how you balance the budget.
Current deficit is now ~$550B, down from over $1T. Ian Shepherdson, the chief economist of Pantheon Macroeconomics, wrote “We are baffled by the idea that the pace of deficit reduction needs to be increased, given how rapidly the picture is improving already.”
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