January 2013
The Deficit Is Not as Serious as They Want You to Think
The bipartisan consensus in Washington does not face important facts: There is no serious immediate deficit problem. Actually, the US deficit is shrinking at the fastest pace since World War II, shrinking from 10.1 percent to 7 percent of the gross domestic product (GDP) during Obama's first term.
Economists are pleading with incoming Treasury Secretary Jacob Lew to acknowledge this.
The truth is that the deficit problem, which is being used to justify cuts to Social Security, Medicare, Medicaid and other social programs, is well within control.
Even if it wasn't in control, cuts are unnecessary. One of the few advantages of being an empire economy and holding the world's dominant currency is that we could maintain a high debt-to-GDP ratio. Great Britain, when it was an empire, for more than a century had a debt to GDP ratio of more than 100 percent, sometimes over 200 percent. The US is not Greece.
The American Empire does not have to starve people at home in order to enrich transnational corporations and oligarchs around the world. When our economy contracts, the government can create money to fill the gaps and when the economy grows, it can reduce the stimulus spending.
In fact, the government could mint its own money and cut out the costs of the middlemen - the Federal Reserve and banks. Of course, an even better path for the American Empire would be to bring the troops home and invest in our domestic economy. This would create a more stable economy and strengthen our position as the world's reserve currency.
Military Spending Can Be Cut - absolutely!
Will Exaggerated Deficit Talks Lead to an "Obama Recession?" We Must Still Ask These Questions
The Deficit Is Not as Serious as They Want You to Think
The bipartisan consensus in Washington does not face important facts: There is no serious immediate deficit problem. Actually, the US deficit is shrinking at the fastest pace since World War II, shrinking from 10.1 percent to 7 percent of the gross domestic product (GDP) during Obama's first term.
Economists are pleading with incoming Treasury Secretary Jacob Lew to acknowledge this.
The truth is that the deficit problem, which is being used to justify cuts to Social Security, Medicare, Medicaid and other social programs, is well within control.
Even if it wasn't in control, cuts are unnecessary. One of the few advantages of being an empire economy and holding the world's dominant currency is that we could maintain a high debt-to-GDP ratio. Great Britain, when it was an empire, for more than a century had a debt to GDP ratio of more than 100 percent, sometimes over 200 percent. The US is not Greece.
The American Empire does not have to starve people at home in order to enrich transnational corporations and oligarchs around the world. When our economy contracts, the government can create money to fill the gaps and when the economy grows, it can reduce the stimulus spending.
In fact, the government could mint its own money and cut out the costs of the middlemen - the Federal Reserve and banks. Of course, an even better path for the American Empire would be to bring the troops home and invest in our domestic economy. This would create a more stable economy and strengthen our position as the world's reserve currency.
Military Spending Can Be Cut - absolutely!
Will Exaggerated Deficit Talks Lead to an "Obama Recession?" We Must Still Ask These Questions