Matt's Market Insights
Pondering the endgame for America's debt problem is not exactly what I would call a pastime, but it seems to occupy more time and attention as days pass. I've yet to hear any groundbreaking ideas. Many still seem to think that it isn't a problem, that we can manage the debt simply by growing the economy to the point where Keynesian style governmental spending can be reduced, leading us back to a budget surplus and beginning the long journey towards repayment.
That's somewhat outlandish for a number of reasons, one being the fact that government spending seems to continually increase regardless of economic conditions. As can be seen below (chart from www.downsizinggovernment.org), even during the period of economic growth leading up to the financial crisis, little attempt was made to curb federal spending. Cutting government spending involves cutting government jobs, or government programs that promote jobs, which leaves a bitter aftertaste and ... Log in or subscribe to continue reading.
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