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Politics : Ask Michael Burke
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To: Skeeter Bug who wrote (115376)8/31/2008 12:56:29 PM
From: Freedom Fighter  Read Replies (2) of 132070
 
skeeter,

It isn't really the current debt or deficit that's the problem. It would be quite easy to support the current debt load by simply tinkering with the growth rate of spending.

If you lower the growth rate of spending to below the nominal growth rate of the economy, real economic growth slowly lowers the deficit and eventually produces surpluses. We wouldn't even have to raise taxes.

You could certainly argue that we are running up debts for things that are unlikely to pay for themselves, but that's typically the case with government.

The real problem is all the long term promises made by pro government politicians that created and consistently expanded the role of SS and medicare in order to get elected. Keeping those promises or coping with them will require massive tax increases, massive cuts and intergenerational warfare, large scale inflation out of the IOUs etc... in coming decades.

Virtually all countries and corporations carry debt. The key is how large they are relative to GDP/earning etc.. not the absolute level.

When dealing with government the key is almost always what people are promising in order to get elected and what it will really take to fund it. Be careful of politicans making promises unless they are promising to make cuts. If they fail on the latter, at least it's neutral. If they succeed on the former, it's always a disaster.
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