Tuesday, January 29, 2013

Dean Baker — Deficit Delusions: Putting to Rest the Clinton Legacy

Not the whole story, but at least it is a start in breaking through the myth about the virtue of budget surpluses that is hamstringing progressives.

Deficit Delusions: Putting to Rest the Clinton Legacy
Dean Baker
(h/t Stephanie Kelton via Twitter)

1 comment:

Matt Franko said...

Right Tom close but not quite....

this is the key thing from Scott in the other thread:

"Further, how do you get stable investment growth in investment spending over the long run? One thing (not the only one, mind you) you do is promote a full employment economy via appropriate levels of NFA (again, usually via increases in NFA of about 2-5% of GDP,..."

This does not look like it is being done right now.... short term $NFA injection is collapsing... $3B net since Dec 1.

Intermediate term, since September, cumulatively we have run a deficit of 244B over these 5 months or average 48B per month which is not much more that what the trade deficit has been, assume the trade deficit has been a bit above 40B per month so that has left the domestic economy with only at most $8B per month of $NFA injection...

This trend would seem unsustainable...