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Old January 9th, 2013, 07:04 AM   #37 (permalink)
Speed Daemon
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Originally Posted by ElasticNinja View Post
That is true, and I agree that economic stimulus is important. However it is important to plan how to finance such a stimulus, and some of that stimulus needs be introduced right away, via taxation that does not have sharp negative fiscal multipliers.
Sharp negative fiscal multipliers? Please define that.

I already explained the plan to finance stimulus spending: take advantage of the negative interest rates while the US government can.

President Obama did introduce a stimulus plan "right away". But the Republicans in Congress stopped it before it could fully restore growth. The longer we wait to resume repairs, the more it will cost us.

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Almost every government does indeed run a deficit. However deficits of around 8% are not sustainable.
That's the difference between President Obama (and President Clinton before him) and the Republicans who seek to destroy our country for their political gain. The good guys in this true story want to turn the deficit around, not sustain it.

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I'm not saying that the US government should not borrow heavily right now. If it was running a surplus it should borrow right now. What I am saying is that there needs to be a plan to converge outgoings and incomes, a plan to restructure the economy.
For those of us who are US citizens living in the US, this isn't a game for amateurs to play. Here in the US, the government does not plan or control the economy. That's not going to change...unless the GOP-led Congress defaults on US sovereign debt and we lose our sovereignty.

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I don't know why so many countries have been so lax on such things. I think it was to do with the lack of realisation that the post-WWII boom is over. 5%+ growth rates are over.
Agreed. The mindset that things are supposed to grow without interruption isn't based in reality. However, after two near-depressions in two decades, the US does need to grow its economy by producing things again. Selling off the industrial infrastructure that used to produce those goods for a one-time quick profit is not sustainable...obviously.

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I agree, and thats what I am saying.
You are now, but not before.

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The current stimulus is quite different to FDR's (the success of which is debatable, I would be inclined to think of it as a qualified success), and it must be remembered that FDR actually kept the debt to GDP ratio steady!
The last time I checked, the US did emerge from the Great Depression. Of course it was successful!

The big difference today is that FDR didn't have a political party committing mutiny in government.

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Well one must remember that debt is rolled over, so cutting spending is important with regards to reducing US sovereign debt.
That's a non sequitur. The only way to pay off a debt is to spend more than the bare minimum debt payments, not less!

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Trust funds are a bad idea though really imo.
You can do as you please over there in Ireland. I have paid a lot of money into those trust funds, with the promise that I'll get it back when I need it. Good, bad or indifferent, I'm not going to walk away from it and let the Republicans give my money to their cronies.

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Well military spending is quite an effective way of directing the US economy to be fair. Better of putting it into infrastructure however.
No, military spending on boondoggles is how wealthy and dishonest politicians abuse their power to make huge profits for themselves at the expense of the rest of the US taxpayers. It's a criminal enterprise that needs to stop. Infrastructure repairs OTOH benefit all Americans equally.
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