maxiep
RIP Dr. Jack
- Joined
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Re: Bad Econmic News
The real issue is that we've been putting off pain and sacrifice, both in the short term and the long term. In the short term, we amassed too much personal debt. Individually, we needed to de-leverage which means less consumer spending which would slow down the economy. That circumstance should have meant a recession of the 1981-82 variety. The longer term issue is that the first baby boomers are retiring. This condition was foreseen and predictable, and both parties blew off saving for this population bulge.
So at the same time we're trying to pay off our personal debt, we're having to increase our public debt to pay our entitlement obligations. Furthermore, the slowing economy (due to less consumption) means that less revenue is going into government coffers while the demand for temporary safety net programs is increasing. It's a tough situation, but not an insurmountable one.
However, what the Obama Administration has made a bad situation worse. The classic prescription is to help the private sector in tough times by temporarily lowering taxes, lessening regulations, accelerating government capital programs that can be bid to private companies and offering tax credits. What was done was almost exactly the opposite.
The real issue is that we've been putting off pain and sacrifice, both in the short term and the long term. In the short term, we amassed too much personal debt. Individually, we needed to de-leverage which means less consumer spending which would slow down the economy. That circumstance should have meant a recession of the 1981-82 variety. The longer term issue is that the first baby boomers are retiring. This condition was foreseen and predictable, and both parties blew off saving for this population bulge.
So at the same time we're trying to pay off our personal debt, we're having to increase our public debt to pay our entitlement obligations. Furthermore, the slowing economy (due to less consumption) means that less revenue is going into government coffers while the demand for temporary safety net programs is increasing. It's a tough situation, but not an insurmountable one.
However, what the Obama Administration has made a bad situation worse. The classic prescription is to help the private sector in tough times by temporarily lowering taxes, lessening regulations, accelerating government capital programs that can be bid to private companies and offering tax credits. What was done was almost exactly the opposite.
