It’s Time to Face the Fiscal Illusion

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    Mar 07, 2011 5:35 PM GMT
    http://www.nytimes.com/2011/03/06/business/06view.html

    We are fooling ourselves most of all. United States government debt in public hands is now more than $9 trillion, but most people still don’t realize what it will take to pay that off. [...]

    Now that fiscal constraints are starting to bite, many politicians are afraid to reform or even to discuss changes in the largest problem areas: Medicare and Medicaid. Yes, some laudable cost controls on Medicare are embedded in the new health care law, but they’re not enough. Most likely, we will end up making other spending cuts that won’t solve our fiscal problems — and in areas that could instead benefit from Keynesian employment stimulus. These kinds of knee-jerk, poorly reasoned decisions are what happens when fiscal illusion reigns.

    Fiscal austerity may sometimes sound like a dogmatic religion, but fixed principles often help us do the right thing, especially when temptation beckons. Professor Buchanan argued that the real choice was between a religion of budget balance and a rule of illusion. Seeking an optimal technocratic path is not on the menu.

    SO, given this mess, what should be done?

    As Matthew Yglesias from the Center for American Progress has proposed, President Obama could pledge to veto any budget that increases the projected medium-term deficit, relative to the status quo. He should include in that veto threat any deficit increases that arise from annual budgetary gimmicks like patches to the alternative minimum tax or the “doc fix” adjustment of Medicare reimbursement rates.

    Such an announcement would not fix health care costs, but it would force us to recognize them, and would move us away from purely short-term planning. It would force the government to consider both spending cuts and tax increases.

    In any case, the rigor of the numbers will soon sweep away the fiscal illusion. The only question is whether we will end the charade on our own terms or continue to play the fool.
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    Mar 08, 2011 9:18 PM GMT
    riddler78 said,

    "Heh sorry to burst your little bubble, I don't actually consider most of the rantings here to be of particular importance and I didn't bother reading the subsequent responses to this thread - and surprise surprise, I didn't bother to read the follow up"[b]
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    Mar 09, 2011 7:28 AM GMT
    It's also now time the democrats stop screaming like wet cats and putting all the blame on GW Bush, as the blame now lays in the hands of the Obama administration.
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    Mar 09, 2011 11:46 AM GMT
    True_Blue_Aussie saidIt's also now time the democrats stop screaming like wet cats and putting all the blame on GW Bush, as the blame now lays in the hands of the Obama administration.



    Oh Please....

    How much did the debt go up under George Bush,,,,,,and include the cost of both wars.
  • GQjock

    Posts: 11649

    Mar 09, 2011 12:06 PM GMT
    The budget CRISES ..... and that is plural
    have been caused by the collapses ... again plural from the
    financial crisis (Singular)

    Resulting from ..... you got it Financial Malfeasance
    Wall Street shenanigans and Bank collusion

    The fight we are going to see
    and this is .... in Wisconsin and in Ohio
    are the first volleys
    The fight we will be waging is going to be is who is going to pay for that Malfeasance
    Is it going to be the Middle Class again or the people who are actually responsible for the CRISES ?