Professor Mark J. Perry's Blog for Economics and Finance
Dr. Mark J. Perry is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan. Perry holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University near Washington, D.C. In addition, he holds an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota. In addition to a faculty appointment at the University of Michigan-Flint, Perry is also a visiting scholar at The American Enterprise Institute in Washington, D.C.
8 Comments:
If the national debt is too high, then we must cut federal agency spending.
As pointed out by Paul, Morgan and Che, the Social Security and Medicare outlays are paid for through payroll taxes.
So, bring a axe, a chain-saw, and a bulldozer, and start cutting. Employment below. Some of these employees get pensions after 20 years of service.
Department of Defense 3,000,000
Veterans Affairs 275,000
Homeland Security 250,000
Treasury 115,000
Justice 112,000
Energy 109,000
USDA 109,000
Interior 71,000
Labor 17,000
HUD 10,000
Education 4,487
O.T.P. Rap
I thought this was a place beyond scary political rhetoric. Is the rationale of this blog not in sync with that of MMT?
Che-
Frankly, I would be happy if Obama was a one-term president, and we replaced him with Ron Paul, from Texas.
Paul has stated he would close down our 800+ overseas military bases, all of which eat tax money, and radically downsize federal military and civilian agencies. Paul has my vote.
Paul also believes men in flying saucers deposited Bernanke at the Federal Reserve Board, but you gotta take the good with the bad.
When the debt gets to the $30 Trillion level, people will finally realize that it's more than an abstract statistic.
The House and Senate budget bills don't cut spending. They only slow the growth in spending, e.g. from 6% to 5% per year.
If the government froze spending, at $3.8 trillion a year for 10 years, budget deficits will shrink and a balanced budget may be achieved within 10 years.
Here's another good link, explaining how all the same scare tactics were used before the last govt shutdown in 1995. The sky didn't fall then, cuz all the scare-mongering about a default were in fact blatant lies. I hope the Tea party stands their ground and forces another shutdown.
" ... If the government froze spending, at $3.8 trillion a year for 10 years"
you have to subtract the FICA revenues from that number if you really want an accurate view of the govt spending that can be cut and when cut... means real cuts.
Cutting FICA would just accelerate the looming demographic problems with SS/Medicare Part A and would have no meaningful affect on the CURRENT 1.5 trillion deficit.
One of the most important things to realize with the current deficit is that we are barely taking in about 1.1 trillion in income taxes and if you use that as the basic benchmark - you soon realize that about 2/3 of that are spent on the military/Afghanistan and 1/3 on Medicare Part B/MedicAid.
It's important to understand the dimensions and specifics of these numbers if we really want to truly understand the 1.5 trillion deficit and how we'd deal with it in a way that would gain sufficient bipartisan political support.
there is no way that Ron Paul on John Strosell are going to be found "reasonable" by 80% of the American electorate.
It might feel good to do the tea party dance or the Libertarian Polka but in the real world - we have to deal with the realities and the simple but stark realities are that we spend about 2/3 of our income tax revenues on the military/2 wars and another 1/3 on non-FICA entitlements (Medicare Part B/MedicAid).
Anyone who thinks that Ron Paul or anyone else is going to be elected President by telling seniors that he's going to do away with Medicare - is living in LA LA LAND.
The proposal for Medicare is going to have to be ...changes... higher premiums, higher co-pays, more means-testing, later qualification ages, etc...that a majority of people will accept.
Anyone who says "wipe out Medicare" is your basic "toast" politically.
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