Comments on: Fact 16a/7b: Temporary Spending Increases Are Not What Drives Long-Term Budget Deficits

By: Andrew

Andrew — Thu, 27 Sep 2012 02:00:39 +0000

Whenever we talk about the deficit as if it matters, we reinforce the notion that the budget of a monetarily sovereign government is like that of a family. It isn’t. A family can’t make money. It’s also nothing like the deficit of Greece or France that have given up the right to create money.

The “deficit” is the same as the federally created money supply. It’s a number. That’s all. More money may be good in some situations, and bad in others, but it’s not like we eventually HAVE to pay it off. Heck, you can even think of it as a home mortgage, to some extent. Most people don’t really expect to pay off a home mortgage, it’s just the price you pay for living in your home. It doesn’t really matter if it gets paid off, just that you can make the payments. And the government can ALWAYS make the payments because it can ALWAYS make money.

People also need to understand that the Fed is independent only in action, not in it being some private for-profit organization. Profits that accrue to the Fed go to the treasury. You can help make this clear to people.

By: Kathryn Crossin

Kathryn Crossin — Wed, 26 Sep 2012 09:42:33 +0000

So are there comparable graphs at your site or elsewhere showing the data for the Bush tax cuts or the prescription drug bill? Would be interesting to see side by side.

By: jarrod myrick

jarrod myrick — Wed, 26 Sep 2012 08:43:06 +0000

it’s not a free lunch, they pay you to eat — run the no-stimulus counterfactuals

we need much bigger budget, much more revenue, seems to me

By: Logan Mohtashami

Logan Mohtashami — Wed, 26 Sep 2012 08:22:55 +0000

Defense, Social Security, Medicare and Interest on the debt, that is what is eating our revenues.

Wait until 2022-2050.. that is when the mother ship of mandatory payouts happen.

Math is Math…. the rest is storytelling