Zakaria: How to Solve America's Debt Problem - Fareed Zakaria - Newsweek.com
OK, but entitlement reform first.
This is a paragraph from the following article which is to the point:
Being unwilling to rein in spending, Obama will soon be proposing further tax increases of a size that will dwarf the few tax breaks he is offering to small businesses that take on new workers. Nobody doubts that the commission the president is appointing to find a way out of the fiscal mess will recommend tax increases now, and spending cuts, if any, much later. Or that Congress might well decide to do neither, and Micawber-like, simply hope that something turns up.
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2 comments:
Prom the London Times:
Consumer confidence is low and, Summers’ musings notwithstanding, the unemployment rate is more rather than less likely to remain high in 2011 and on into 2012. No recovery will be robust or sustainable unless consumer demand, which accounts for about 70% of economic activity, returns to something like normal levels. Most observers do not see that happening. John Makin, an economist at the American Enterprise Institute, a Washington think tank, writes in his latest economic outlook: “The sustainability of US demand growth, the key to a solid recovery, remains in question as the improvement in employment data has stalled while consumer confidence has remained weak.” Add the fact that American households are still deeply in debt, and there is reason for pessimism about the ability of the consumer to power a significant long-term recovery.
And any hope of an export-led recovery was dashed last week when it became apparent that economic growth in Europe has stalled. With so many European countries scrambling to deleverage their national accounts, Europe’s ability to absorb imports from America is heading down, not up.
Of course, a significant increase in job creation would change the outlook. Data released at the end of last week provide at least a slim hope that the employment picture might be about to brighten. The unemployment rate stabilised at 9.7%, and job losses were limited, at least by the standards of last year. But one month does not make a trend, and we have to assume that it will take a sizable increase in economic activity before the recent increase in the hiring of temporary workers converts into offers of permanent, full-time employment.
The outlook is worsened by the sorry state of the public finances, both at the state and federal levels. California and New York are only the most publicised examples of the many states that are in no better shape than Greece, and are being forced to cut back on jobs and capital projects. And the condition of the federal books would be even worse were it not for the fact that in the end the federal government can print its way out of the problem. Deficits are high and rising, the Congress is readying still more spending bills, and the president is insisting that Congress enact his $1 trillion healthcare bill.
Being unwilling to rein in spending, Obama will soon be proposing further tax increases of a size that will dwarf the few tax breaks he is offering to small businesses that take on new workers. Nobody doubts that the commission the president is appointing to find a way out of the fiscal mess will recommend tax increases now, and spending cuts, if any, much later. Or that Congress might well decide to do neither, and Micawber-like, simply hope that something turns up.
That means we have an odd situation. We are to have jam today, this year, and perhaps even next, with the bill to come due shortly thereafter. If Obama has his way, that won’t happen until after his re-election in 2012.
Irwin Stelzer is a business adviser and director of economic policy studies at the Hudson Institute
So crazy Rich replies:
So you will take less in medicare pmts?
And so I pull my hair out!
Sane Morning Coffee nation (ie those not named Baxter:), can we talk?
I, we, Republicans, Conservatives, Doctors have all said, let's give the patients some skin in the game and we will accept the consequences. But..and this is a very big but, let's not put government controls on health care spending, let's not let the government decide on care (death panels are not such a far fetched idea), let's not JUST DO SOMETHING to give "o" a victory and turn over our most private issues to the sledgehammer that is government control
and
yes, what you, you being the left, are proposing is a Trojan horse as outlined in the M. Steyn article.
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