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Lefty Thinker

(96 posts)
33. I wish this were true
Thu Nov 8, 2012, 09:13 AM
Nov 2012

But cutting military spending, like any other deficit reduction measure, will only result in an economic downturn. Deficits are not inherently bad; they make up for drains on circulating currency to private savings and net imports. Cutting spending on the military (or on "entitlements" or anything else) reduces the deficit without changing the dynamics of the private or external sectors. This will absolutely lead to higher unemployment, which also means additional expenditures on unemployment and welfare programs, which adds more spending than the cuts removed.

This is what Greece is facing, forced on them by the Troika and their own insistence on staying in the Euro. There may be some structural spending problems in Greece, but the solution is not to cut spending as they have been forced to, but rather to spend as much or more in wiser ways - ways that build the future productivity of their nation. But they chose to relinquish their power to issue currency and must, until they reclaim it, play by the Eurozone rules.

If America wants to avoid Greece's fate we must, first and foremost, avoid misunderstanding the existing realities. Neo-liberal (and even Keynesian) economists slip into traps of worrying about the deficit. But, if we want a growing economy, the deficit must be determined from the private and external sector balances. Any attempt to act directly on the deficit (i.e. cutting spending or raising taxes) is actually self-defeating.

I think Obama should at least threaten to let the fiscal cliff happen ItsTheMediaStupid Nov 2012 #1
Raise taxes on the 1%, cut military spending and tax the church, budget balanced. sarcasmo Nov 2012 #2
sarcasmo Diclotican Nov 2012 #5
Raise taxes on the 1%, cut military spending and tax the church, budget balanced. AlbertCat Nov 2012 #7
+100000000000000000 do not give in to those f-ing R's - they are party of FAIL wordpix Nov 2012 #13
Right on, it's time for the DNC to grow a backbone. sarcasmo Nov 2012 #14
Defense spending is the largest portion of ANY US Budget! benld74 Nov 2012 #3
Reducing the deficit isn't why they want the programs cut jmowreader Nov 2012 #24
That's exactly right. FiveGoodMen Nov 2012 #39
Well...okay jmowreader Nov 2012 #42
I think the GOP VOTERS believe (other) people are essentially lazy FiveGoodMen Nov 2012 #45
Those guys have always wanted all the power jmowreader Nov 2012 #46
DonViejo Diclotican Nov 2012 #4
I wish this were true Lefty Thinker Nov 2012 #33
Lefty Thinker Diclotican Nov 2012 #35
the entitlement programs that are the primary drivers of our debt.Ē AlbertCat Nov 2012 #6
Or does he mean the military, veterans benefits and the defense industry? cstanleytech Nov 2012 #11
"I've got political capital and I intend to spend it" montex Nov 2012 #8
+1. robinlynne Nov 2012 #20
Oh Obama isnt raising taxes actually as the republicans themselves are doing that cstanleytech Nov 2012 #9
yes ofcourse maindawg Nov 2012 #10
Fuck this asswipe Boner argiel1234 Nov 2012 #12
Just politics as usual defacto7 Nov 2012 #15
PBO has all the cards.....nt ProudProgressiveNow Nov 2012 #16
Here they come again - same old same old. gtar100 Nov 2012 #17
Bite me, douchebag. And look up compromise in the dictionary. SunSeeker Nov 2012 #18
if he (Obama) wnats to. the first time he gave away the cards. HOpe he HOLDS them this time! robinlynne Nov 2012 #21
Sorry GOPs adieu Nov 2012 #19
Agreed, it's how you negotiate with children, as I learned with my daughter... Volaris Nov 2012 #32
Only a fool would trust the Republicans. glinda Nov 2012 #22
"let's compromise by having you surrender completely.." Alamuti Lotus Nov 2012 #23
Better compromise jmowreader Nov 2012 #25
Damn, I thought I was clicking on an onion article. tavalon Nov 2012 #26
These Rethugs,,,,, Cryptoad Nov 2012 #27
The President needs to play some hardball with the Orange man. liberal N proud Nov 2012 #28
Hardball is right! Dyedinthewoolliberal Nov 2012 #44
Boehner is essentially saying animalcrackers Nov 2012 #29
I'm all for talking to the Rethugs Andy Stanton Nov 2012 #30
Heres Obama's answer Corgigal Nov 2012 #31
Don't believe the Repukes and don't give any leeway - socialindependocrat Nov 2012 #34
I'm done with that. Let the Bush tax cut expire. Xyzse Nov 2012 #36
Republican Compromise: Hayabusa Nov 2012 #37
entitlements are a primary driver? Not defense spending, war, and tax cuts for the rich? yurbud Nov 2012 #38
Just John2 Nov 2012 #40
The GOP already raised all our taxes. sofa king Nov 2012 #41
I think the conversation should go something like this: Dyedinthewoolliberal Nov 2012 #43
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