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Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: Neocon who wrote (118286)	12/20/2000 3:53:08 PM
From: asenna1	Read Replies (1) \| Respond to of 769670

The Market is not agreeing with you, is it? Clowns Rule.

To: Neocon who wrote (118286)	12/20/2000 4:35:49 PM
From: TimbaBear	Read Replies (1) \| Respond to of 769670

Debt service is a normal part of the budget. I can see this argument for a business that is growing revenues. Then the business fully leverages itself through debt and uses the money to expand its operations and increase its market share and revenues and,presumably, net income. But this reasoning does not apply to government in the same way. Using this reasoning there would never be a reason for fiscal repsonsibility. The deficit spending of the Reagan terms and the Bush era has taken the debt to levels where the interest payments alone rank higher than education and right on a par with defense. Using the surplus to not create more debt through the Treasury fundings and actually have Treasury call in some of the older bonds early only gives us a cushion for when we really may need deficit spending(like the boomer retirement years). No one really anticipates that the pols in Washington would ever pay-off the debt in just a few years, but the effort to pay it down to more reasonable levels has its rewards for the economy. Instead of the banks having a five star borrower like the US Government available to gobble up any surplus funds they may occasionally have to lend, they have been forced to lend it in the private sector and to be in competition to do so. That has driven down interest rates on Commercial paper and thus fueled capital expenditure growth. That era is apparently over for at least 4 years and the resultant opinions on Wall Street indicate their views. . But reserving funds in substantial amounts would sharply reduce aggregate demand, and produce a recession. I don't follow your drift here....who would be reserving funds?....not the Federal Government, they would be releasing funds(those not borrowed by the Government because they have lower needs)....how would aggregate demand be reduced?.....aggregate demand for what?