So long as the US government also shows zero interest in dealing with the problem,
Well, the question is how to deal with the problem. Many, including you, I guess, seem to be assuming that the US govt. must implement austerity measures to address the debt situation. That's not crazy talk, but I don't hear many explaining why that and the attendant deflationary risks, is preferable to ensuring that an environment for healthy growth is maintained. It's not at all obvious to me that huge spending cuts are exactly what the US needs now insofar as it's entirely possible that that could exacerbate the problem rather than fixing it. It's not silly to argue that insofar as current gov't spending is getting the economy back on track for growth, it is in fact "dealing with the problem".
The current US deficit and the portion of it held by foreign entities really does concern me, don't get me wrong. But I'm just arguing that (i) addressing the deficit question is not as simple as decreasing spending and (ii) the failure to decrease spending isn't the same as not dealing with the problem. There's an important disanalogy between household and government debt in this respect.
Credits & Style Info
Talk Politics. A place to discuss politics without egomaniacal mods
![[community profile]](https://www.dreamwidth.org/img/silk/identity/community.png){kind=small}
(no subject)
Date: 28/4/10 17:30 (UTC)Well, the question is how to deal with the problem. Many, including you, I guess, seem to be assuming that the US govt. must implement austerity measures to address the debt situation. That's not crazy talk, but I don't hear many explaining why that and the attendant deflationary risks, is preferable to ensuring that an environment for healthy growth is maintained. It's not at all obvious to me that huge spending cuts are exactly what the US needs now insofar as it's entirely possible that that could exacerbate the problem rather than fixing it. It's not silly to argue that insofar as current gov't spending is getting the economy back on track for growth, it is in fact "dealing with the problem".
The current US deficit and the portion of it held by foreign entities really does concern me, don't get me wrong. But I'm just arguing that (i) addressing the deficit question is not as simple as decreasing spending and (ii) the failure to decrease spending isn't the same as not dealing with the problem. There's an important disanalogy between household and government debt in this respect.