If you've read much of what was said in those days, respectable people, you might believe that deficits are always and everywhere became the main source of economic problems. But, you know, it's not quite true.
A few examples of the current era is not so terrible, but they illustrate the traditional way of thinking. David Sanger (David Sanger) argues that the U.S. may suffer from the same disease, who suffered from Japan last decade. Once the debt this country has grown faster than income - means the influence of this country on the world undermined.
Is it true that so? I think that Japan's influence decreased because of the sluggish economy and its failure to maintain the status of economic superpower, and I never heard anyone referred to the debt, as the major cause of reduced influence. And note that until now, Japan had no problems with financing its deficit.
By the way, that is not true, as alleged in the article "The Chinese leadership", is the fact that this country provides most of the money to finance the U.S. government. I'm trying to tell people: surge in government borrowing was more than offset by the failure of private borrowing, and now we are less dependent on foreign funding, compared with a prolonged period in the past.
Meanwhile, The Times published an article about the problems the euro, which came as welcome. Focusing on Greece may make readers think that the basis of financial turmoil the euro is the waste of the government, which has never lived on opportunities.
No. The biggest problem is not in Greece, and Spain, who ran a budget surplus a few years ago. It's true, Spain now controls a large deficit, but this is due to the economic collapse in the country. And it underlies the euro collapse: one monetary policy for different countries, which does not help those countries that suffer from negative shocks.
There are two things that upset during the discussion fiskalizatsii. First: the fact that its use even the best economists in the course of heated argument, proving the complex belief systems. Second: Many people, arguing that the deficit becomes a big problem, perhaps not even realize that they occupy a precarious position and it is only part of what they do not understand.
Even the gods against the stereotypes.
The tactics of intimidation of fiscal
Nowadays it is difficult to buy a newspaper or to include news and not hear about a severe warning to the federal budget deficit. We are told that the deficit threatens the economic recovery, putting at risk the stability of the American economy, it would undermine our influence in the world. These statements are not usually presented as the views and opinions that are held by some analysts and others are discussed, they are reported as if they were facts - simple and understandable.
Nevertheless, it is not the facts. Many economists are much calmer reaction to the budget deficit than is shown on TV. Investors also do not seem very concerned about: the United States government bonds continue to find buyers, even with historically low interest rates. Longer term budget is problematic, short prespektiva - no, and even the long term less frightening than it is now trying to impose on the public.
So what appeared a sudden ubiquity of bullying stories about the deficit? They have not appeared in the news. It was obvious, at least a year ago that the U.S. government will face a prolonged period of huge deficits, and these forecasts have not changed significantly since last summer. Nevertheless, the drumbeat of terrible financial warnings became much louder.
For me, and I'm not alone in this, the sudden outbreak of "deficit hysteria" is the idea of groupthink, which was popular in the run-up to prepare for war in Iraq. Now, as then, a dubious claim, not backed by facts, are reported as if they were installed accurately and without hesitation. Now, as then, most political organizations and the media too actively pursue the view that it is necessary to take swift and decisive action, although there was no new information to buttress such sudden action. Now, as then, those who have been leery of the proposed facts, no matter how authoritative they are, and what sources are used - only a secondary role.
'Scarce paranoia "can bring as much harm as the hysteria related to weapons of mass destruction.
Let's talk a little about the actual budget. Contrary to what you often hear, a huge budget deficit, which is administered by the federal government, not the result of bezkontrolnogo cost increases. More than half of the budget deficit is caused by the current economic crisis, which led to falling tax revenues needed to save the federal financial institutions, for the government to implement temporary measures to stimulate growth and employment support.
The fact that the management of a large deficit in the worst economic downturn since 1930 - is just what you need to do. When it comes to that, the deficit should be even greater than it is because the Government should do more to create jobs.
Indeed, long-term budget is problematic. Even a complete recovery of the economy has not eliminated a budget deficit, and, perhaps, it would not even reduced the budget for a long time to a sustainable level. So, as soon as the economic crisis ends, the U.S. government will be forced to increase their revenues and control expenses. And in the long run there is no method to calculate the budget, until something is not done about health care costs.
However, there is no reason to panic because of the prospects for the budget for the next few years or even decades. Take, for example, the last budget proposal from the Obama administration, which refers to the payment of interest on federal debt, predicted in 10 years they will grow up to 3,5% of GDP. Frightening? This is about the same cost per cent, as under President Bush.
Why then all this hysteria? The answer is politics.
The main difference from last summer when we have made great strides towards the deficit that the current escalation of fear has become a key part of Republican political strategy, double the work: it harms the credibility of Obama during his line of policy. And if their hypocrisy is breathtaking, the policies have to vote for ruining the budget tax cuts, masquerading as apostles of financial morality and obsessive attempts to control health expenditure in a single day, now condemns the excessive government spending, then, is whether the This situation is something new?
The problem is that for many people is clearly very difficult to identify the differences between the cynical posturing and serious economic arguments. This will have tragic consequences.
Thanks to the "deficit hysteria" in Washington are now operating in the wrong direction: all the talk only about how to cut government spending for a couple of billion, while how to use every opportunity to address the problems of mass unemployment. Policy is moving in the wrong direction, and millions of Americans will pay for it.
A few examples of the current era is not so terrible, but they illustrate the traditional way of thinking. David Sanger (David Sanger) argues that the U.S. may suffer from the same disease, who suffered from Japan last decade. Once the debt this country has grown faster than income - means the influence of this country on the world undermined.
Is it true that so? I think that Japan's influence decreased because of the sluggish economy and its failure to maintain the status of economic superpower, and I never heard anyone referred to the debt, as the major cause of reduced influence. And note that until now, Japan had no problems with financing its deficit.
By the way, that is not true, as alleged in the article "The Chinese leadership", is the fact that this country provides most of the money to finance the U.S. government. I'm trying to tell people: surge in government borrowing was more than offset by the failure of private borrowing, and now we are less dependent on foreign funding, compared with a prolonged period in the past.
Meanwhile, The Times published an article about the problems the euro, which came as welcome. Focusing on Greece may make readers think that the basis of financial turmoil the euro is the waste of the government, which has never lived on opportunities.
No. The biggest problem is not in Greece, and Spain, who ran a budget surplus a few years ago. It's true, Spain now controls a large deficit, but this is due to the economic collapse in the country. And it underlies the euro collapse: one monetary policy for different countries, which does not help those countries that suffer from negative shocks.
There are two things that upset during the discussion fiskalizatsii. First: the fact that its use even the best economists in the course of heated argument, proving the complex belief systems. Second: Many people, arguing that the deficit becomes a big problem, perhaps not even realize that they occupy a precarious position and it is only part of what they do not understand.
Even the gods against the stereotypes.
The tactics of intimidation of fiscal
Nowadays it is difficult to buy a newspaper or to include news and not hear about a severe warning to the federal budget deficit. We are told that the deficit threatens the economic recovery, putting at risk the stability of the American economy, it would undermine our influence in the world. These statements are not usually presented as the views and opinions that are held by some analysts and others are discussed, they are reported as if they were facts - simple and understandable.
Nevertheless, it is not the facts. Many economists are much calmer reaction to the budget deficit than is shown on TV. Investors also do not seem very concerned about: the United States government bonds continue to find buyers, even with historically low interest rates. Longer term budget is problematic, short prespektiva - no, and even the long term less frightening than it is now trying to impose on the public.
So what appeared a sudden ubiquity of bullying stories about the deficit? They have not appeared in the news. It was obvious, at least a year ago that the U.S. government will face a prolonged period of huge deficits, and these forecasts have not changed significantly since last summer. Nevertheless, the drumbeat of terrible financial warnings became much louder.
For me, and I'm not alone in this, the sudden outbreak of "deficit hysteria" is the idea of groupthink, which was popular in the run-up to prepare for war in Iraq. Now, as then, a dubious claim, not backed by facts, are reported as if they were installed accurately and without hesitation. Now, as then, most political organizations and the media too actively pursue the view that it is necessary to take swift and decisive action, although there was no new information to buttress such sudden action. Now, as then, those who have been leery of the proposed facts, no matter how authoritative they are, and what sources are used - only a secondary role.
'Scarce paranoia "can bring as much harm as the hysteria related to weapons of mass destruction.
Let's talk a little about the actual budget. Contrary to what you often hear, a huge budget deficit, which is administered by the federal government, not the result of bezkontrolnogo cost increases. More than half of the budget deficit is caused by the current economic crisis, which led to falling tax revenues needed to save the federal financial institutions, for the government to implement temporary measures to stimulate growth and employment support.
The fact that the management of a large deficit in the worst economic downturn since 1930 - is just what you need to do. When it comes to that, the deficit should be even greater than it is because the Government should do more to create jobs.
Indeed, long-term budget is problematic. Even a complete recovery of the economy has not eliminated a budget deficit, and, perhaps, it would not even reduced the budget for a long time to a sustainable level. So, as soon as the economic crisis ends, the U.S. government will be forced to increase their revenues and control expenses. And in the long run there is no method to calculate the budget, until something is not done about health care costs.
However, there is no reason to panic because of the prospects for the budget for the next few years or even decades. Take, for example, the last budget proposal from the Obama administration, which refers to the payment of interest on federal debt, predicted in 10 years they will grow up to 3,5% of GDP. Frightening? This is about the same cost per cent, as under President Bush.
Why then all this hysteria? The answer is politics.
The main difference from last summer when we have made great strides towards the deficit that the current escalation of fear has become a key part of Republican political strategy, double the work: it harms the credibility of Obama during his line of policy. And if their hypocrisy is breathtaking, the policies have to vote for ruining the budget tax cuts, masquerading as apostles of financial morality and obsessive attempts to control health expenditure in a single day, now condemns the excessive government spending, then, is whether the This situation is something new?
The problem is that for many people is clearly very difficult to identify the differences between the cynical posturing and serious economic arguments. This will have tragic consequences.
Thanks to the "deficit hysteria" in Washington are now operating in the wrong direction: all the talk only about how to cut government spending for a couple of billion, while how to use every opportunity to address the problems of mass unemployment. Policy is moving in the wrong direction, and millions of Americans will pay for it.
The New York Times
No comments:
Post a Comment