[quote=briansd1]linvinincali, you can argue argue that we should cut spending during the good years all you want and you would agree with Keynes.
The fact remains that Bush cut taxes and increased spending.
As SK pointed out earlier, cutting spending will not stimulate the economy. It won’t work.
You can argue that short term pain is necessary for long term prosperity But nobody is proposing pain. Everyone wants to stimulate the economy.
The people on the right are proposing painful measures as if those measures would stimulate. They won’t. That’s hipocrisy right there.[/quote]
I think we should cut spending now. I don’t think we should wait until things get better. I’m not going to make an argument that cutting spending in going to be stimulative in the short term because it certainly won’t. Most likely cutting spending now will result in a short deep depression.
My argument is that although we’ll have to deal with that relatively short deep depression it is good for the long term. Clearing the bad debt, letting those that made bad debts fail, and prosecuting those that committed fraud will cure the economy for the long term. Rather than living through Japan’s up and down sideways economy that constantly needs stimulus and bailouts we’ll be back to an economy that can flourish because it isn’t saddled with a bunch of bad debt.
Our stimulus spending is not “priming the pump” like it’s suppose to, instead it’s producing a negative rate of return. If you have a small business that is losing money and subsequent investments don’t turn it around you have to cut your losses at some point. Isn’t better to cut your losses before you lose your house. Isn’t better for the US to cut it’s losses on deficit spending before it’s forced to default or print. The day you resort to unbacked currency emission or default is the day that you can no longer deficit spend, in essence the market forces you to live within your means.