mbs: defense spending could suffer in the atmosphere
of surplus mania. There hasn't been a determined push
for more defense since the 80's. We'll see how it fares
now.
Certainly the tax cut was an effort to prevent revenue
from financing spending, among other motivations, following
the 1981 example.
Moderate deficits are o.k. normally, and good if the
economy is slow; surpluses could be bad if the economy is
slow. All of this is taken less seriously than it used
to be. If Wynne Godley and Alex are right, then surpluses
could be positively disastrous in the near future. The
only real thing to worry about is unsustainable growth in
debt, but that is not an issue these days.
For state and local govs, running moderate deficits in
down times requires building up a surplus in good; then you
don't have to jerk your tax & spending programs around in
response to the business cycle.
mbs
((((((
CB: He hoists Star Wars on his own petard ?
CB: This is the Reaganite maneuver ?
CB: They have flipped me over so many times over the years, I have to try to
remember that deficit spending is good, balancing the budget and surpluses
is bad, right ?
