This is a forum based out of Pensacola Florida.


You are not connected. Please login or register

Big business is bad for the American worker.

Go to page : Previous  1, 2

Go down  Message [Page 2 of 2]

The USA ended 2017 with appx 666 billion dollar deficit ... an 80 billion dollar increase over 2016.   That's about a 12% increase in the deficit in just one year!

The tax bill will add appx 155 billion per year in new debt (1.5 trillion/10 years).  It remains to be seen if an infrastructure bill is passed how much that will add, but I expect it's going to far exceed the 200 billion mentioned by Trump once all the pork barrels get filled. Plus the increases in military and homeland security spending that are going to happen under this Congress. And we've still got brush wars all over the world to fund. And a nuclear defense program that needs a big infusion of money to update it.

Now I know old Dick "shotgun" Cheney told us all there's nothing to fear and that "deficits don't matter" .... but what all that new debt means where the rubber meets the road is the Govt will have to sell more T-bills.   And to sell 'em interest rates may have to go up. (who wants T-bills at sub 3% when the economy is sailing along we have a bull market in equities?)   And when interest rates on T-bills goes up the government's cost of servicing the debt goes up which means even more debt must be issued.  Further ... interest rate increases will at the same time be a drag on the economy/gdp ... but the Fed may have to allow it in order to cool down the equities market and support continued government spending. That will help the T-bill market ( cheers ) ... but increases in interest rates will be a drag on consumer spending.

I'm no professional economist (but I read a lot & I did stay at a Holiday Inn Express once) ... but seems kind of a far fetched idea to me economic growth will be so rapid & sustained due to the corporate tax cut and what de-regulation has been done that it will make up the shortfall in revenue to the government to support increased spending.  History is not on the side of that theory.

View user profile
EmeraldGhost wrote:
I'm no professional economist (but I read a lot & I did stay at a Holiday Inn Express once) ... but seems kind of a far fetched idea to me economic growth will be so rapid & sustained due to the corporate tax cut and what de-regulation has been done that it will make up the shortfall in revenue to the government to support increased spending.  History is not on the side of that theory.

Perhaps you should read a little more. Here's a good place to start:

https://www.washingtonpost.com/business/modern-monetary-theory-is-an-unconventional-take-on-economic-strategy/2012/02/15/gIQAR8uPMR_story.html?utm_term=.1a81ffef0b3c

Public debt is private savings.

The National debt is money THE GOVERNMENT OWES US!
http://bilbo.economicoutlook.net/blog/?p=10384

View user profile

Back to top  Message [Page 2 of 2]

Go to page : Previous  1, 2

Permissions in this forum:
You cannot reply to topics in this forum