Sorry Jed, but your analysis conflicts with every economist that I
have read and I read many. Raising taxes back to Clayton is not
possible because the economy is not growing as fast as it was then so
that the tax rate would have to be a bigger fraction of the income to
provide the same amount of money, which people resist. Also, the debt
is much larger now. We have passed the point of no return according
to most analysts.
Ed
On Jan 26, 2013, at 4:11 PM, Jed Rothwell wrote:
Edmund Storms <stor...@ix.netcom.com> wrote:
Debt is good within limits, Eric. The problem comes when the amount
of debt exceeds the ability to pay back or even to service, i.e. to
pay the interest. This is why people lost their homes. The US
government has now reached a debt so large that it cannot be paid
back and can barely be serviced. This is a fact.
That is not true. All we have to do is raise taxes back to the level
they were under Mr. Clinton. If the economy recovers the debt will
soon begin to decline. It was declining rapidly under Clinton.
Government expenditures have not increased, except for the Pentagon,
and now that the wars are over I don't see why the military budget
should be so high.
The debt crisis is ginned up nonsense, in my opinion. It could be
fixed with slightly higher tax rates so small we would hardly notice
them. Mainly on wealthy people. I am sure that wealthy people can
afford to pay 3% more than they now do. It is trivial matter for them.
For that matter, the U.S. government can print money. A little
inflation would soon reduce the debt as a percent of the GDP. We
would hardly notice that, either. The Japanese government under PM
Abe is deliberately trying to inflate by 3%, after years of
deflation. It is about time! If they succeed and the economy also
grows, their debt will decline. It is twice as high as the U.S., as
a percent of the GDP, but Japan is not in crisis.
- Jed
