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Economists warn that dramatic spending cuts could double dip the recession and kill the already fragile economy. Republicans are taking us on a one way ticket to the abyss.
Lol, what a dreadful piece of tripe. There is so much silliness in this piece the OP should be ashamed to link to it. There is so much to be easily refuted, I will start at the top. The piece warns that "most" economists warn of a double dip if there are spending cuts, then goes on to quote one left wing economists. So it begs the question who are these " most" economists? Also what effect would a down grade of our debt have (because we have too much, as the ratings agencies have warned us) on our economy?
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Not what I'd consider fertile ground for the airing of factual unbiased analysis of the economy.
Economists warn that dramatic spending cuts could double dip the recession and kill the already fragile economy. Republicans are taking us on a one way ticket to the abyss.
There is a gap between tax revenue and spending. So there are three choices ... 1) increase taxes, 2) decrease spending or 3) do a bit of both.
Right now, I don't see a lot of appetite in the country for serious cuts in spending. Cuts to social security and/or Medicare seem to be a big no-no. The Republican loss of a safe seat in New York is an indicator of that. However, there is clearly no willingness on the part of Congressional Republicans to increase taxes. So we have fiscal gridlock and I don't see that ending any time soon.
There is a gap between tax revenue and spending. So there are three choices ... 1) increase taxes, 2) decrease spending or 3) do a bit of both.
Right now, I don't see a lot of appetite in the country for serious cuts in spending. Cuts to social security and/or Medicare seem to be a big no-no. The Republican loss of a safe seat in New York is an indicator of that. However, there is clearly no willingness on the part of Congressional Republicans to increase taxes. So we have fiscal gridlock and I don't see that ending any time soon.
It is true. There is going to have to be a combination of both. We are on the precipice. At no time in modern history have we been in such a difficult situation. At least with the great depression, there was not the double edge sword of the defict and high unemployment. It is going to have to be a gradual change. Small tax increases on the very wealthy and small cuts in spending.
Most economists warn, as Bernanke did, against an immediate drawdown in federal spending. With business investment, trade and consumer spending all still lagging, government remains the only actor with the power to maintain economic demand. “Curtailing the one major consumer that is continuing to consume—it’s just a terrible idea, especially when you have a major demand gap,” says Michael Linden of the Center for American Progress.
"Federal Reserve Chairman Ben Bernanke says a plan from House Republicans to cut $61 billion in spending this year would not harm economic growth."
"Although Bernanke didn't provide a projection of possible jobs losses from the spending bill, he said the proposed spending cuts aren't likely to lead to the 700,000 job losses predicted by*Moody's Analytics chief economist Mark Zandi."
And from his comments.
"At the same time, establishing a credible plan for reducing future deficits now would not only enhance economic performance in the long run, but could also yield near-term benefits by leading to lower long-term interest rates and increased consumer and business confidence." http://federalreserve.gov/newsevents...e20110607a.htm
one more time, we dont have a revenue problem, we have a spending problem. the federal government has gotten a hold of the american express platinum card and has charged it up to the max, and is wanting more credit to spend even more money.
it has been calculated that we can take ALL income from all individuals over $50,000, and take EVERY dime of profit for EVERY business in the country, and we can run the federal government for a grand total of 7 months. too much spending and too much debt has caused the financial issues we see today. we need severe spending cuts, and we need to make the business environment much more friendly in this country so that we can grow the economy to get out of our financial issues. until that happens, this country is going to head down the road of financial ruin.
Most economists warn, as Bernanke did, against an immediate drawdown in federal spending. With business investment, trade and consumer spending all still lagging, government remains the only actor with the power to maintain economic demand. “Curtailing the one major consumer that is continuing to consume—it’s just a terrible idea, especially when you have a major demand gap,” says Michael Linden of the Center for American Progress.
"Federal Reserve Chairman Ben Bernanke says a plan from House Republicans to cut $61 billion in spending this year would not harm economic growth."
"Although Bernanke didn't provide a projection of possible jobs losses from the spending bill, he said the proposed spending cuts aren't likely to lead to the 700,000 job losses predicted by*Moody's Analytics chief economist Mark Zandi."
Did you read the OP...dramatic cuts. From your own source.
Bernanke "Two percent [reduction in growth] is enormous and would be based on $300 billion in cuts," Bernanke told the panel in his semiannual report to Congress. "Sixty billion to $100 billion isn't sufficient to create that kind of effect
300 billion is dramatic. However Moodys and Sachs seem to believe 61 million would be enough to have detrimental effect. Why do you always post articles that support my post and undermine yours. You should read before you cite something, but thanks for the help although completely unnecessary.
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