Federal Deficit Is Greatest Threat to U.S. Economy, NABE Says

[NVMojo]

March 21 (Bloomberg) -- The U.S. budget deficit poses the greatest threat to economic growth in the short term, ahead of terrorism and the current account gap, according to a National Association for Business Economics survey.

In the longer term, rising Social Security and health-care costs are the main problems facing the world's largest economy, the Washington-based economists group said in a statement. Sixty- nine percent of survey respondents said the Social Security system has serious problems and needs to be fixed now.

More than a fourth of NABE members -- 27 percent -- said government spending and fiscal deficits are the biggest threats to growth. The White House and Congress have pledged to reduce the budget deficit, which last month reached a record $113.9 billion. Still, most respondents -- 76 percent -- thought fiscal policy is too loose and 31 percent expect deficits to increase.

``NABE members, by a narrow margin, now believe that the federal deficit is a larger problem than terrorism'' in the short run, David Wyss, chief economist at Standard & Poor's and one of the conductors of the survey, said in the statement. ``Longer term, the costs related to the aging of the population dominate the challenges to sustaining economic growth.''

Seven months ago, terrorism was cited by 40 percent of NABE members as the greatest threat, compared with 23 percent who said deficits. Terrorism fell to 24 percent in the latest survey, while 15 percent now cite the current account gap.

more...

http://www.bloomberg.com/apps/news?pid=10000103&sid=aV9d59yRSIhA&refer=us

[Melodybe]

1. The $200 billion in Iraq wouldn't have helped at all.

that has nothing to do with our problems.

[applegrove]

2. It kept people not knowing how bad the economy really was and

kept them going into debt. You know buying houses and going to malls like their President asked.

The Elites...gotta love em.

[Don1]

9. This story is much bigger than money and our economy.

200 billion? Maybe in terms of some of the government contracts, but look at the big pictire. Go to this site:
http://www.publicintegrity.org/wow/resources.aspx?act=total

Why is everyone talking about the economy here anyway? Why is the NABE debating about such trivial things as the content of their survey?

The important issue is that Iraqi civilians are dying and this includes tens of thousands of children. Of course, the motivation for killing Iraqi children is the hundreds of billions of profit that Halliburton will get...but isn't that the biggest issue with the money? That this blood money was originally ours and should have been used to feed jobless Americans and improve our well-being instead of napalming Iraqi kids, cats, and dogs?

This is what you were saying by bringing up the $200 billion, right? On Edit: Oh wait, you said it wouldn't have helped at all. So, you are looking for something bigger...like the cause of the government voting to give $200 billion up to corporations. Ok, I got you now. What do you propose?

[Wilms]

3. Not good. n/t

[CindyDale]

4. NABE = Greenspan pals

http://www.nabe.com/members.htm

[truthisfreedom]

5. didn't these people get the talking points? Terry Schiavo's feeding tube

is the biggest threat to the economy!

[teryang]

6. Actually, it's the Defense Budget that has serious problems

Money is being stolen from Social Security to pay for frivolous colonial expeditions overseas that are lining the pockets of war profiteers aka the bush dynasty base.

Neo-con carpetbaggers complain that social security is in a huge crisis. The only crisis it has as the sole solvent fiscal arrangement in the Federal Government is that it is the target of an orchestrated plan to plunder it down to the last dime.

[area51]

7. threat to the economy

There's a threat to the economy & it's living @ 1600 PA Ave. The chimperor has basically destroyed our economy so that new jobs aren't being created.

---

"Prosperity is just around the corner." -- Herbert Hoover
"The economy has turned a corner." -- GW Bush

Herbert Hoover = GW Bush

Neither man cared about the Depression their economic policies created.

[mainer]

8. Nonsense! Cheney told us that "deficits don't matter!" nt

[indepat]

10. Sheer genius to conclude massive deficits are greatest threat to US

economy. Gee, wish I could have thought of that first.

[ProfessorGAC]

11. I Did!

I published a paper in 1991 (the first one that was ever published nationally) that showed that deficits DO matter (Gee, who would have figured Dick Cheney was wrong?). That they are are a traceable and quantifiable negative factor in economic growth and stability. Even worse is that the leverage of this factor increases exponentially as consecutive of deficits. (Think compound interest curves.)

In addition, these deficits, since the 80's have involved huge increases in direct gov't spending while transfer payments are essentially flat (or linked to CPI). So, the growth is an illusion caused by borrowed money spent in huge sums. Hence, there is no REAL positive, and a series of negatives.

The fact that these guys have come to the brilliant conclusions that we can't do this forever is hardly a revelation. As a matter of fact it's the domain of Captain Obvious.
The Professor

[dweller]

12. link?

TIA

dp

[ProfessorGAC]

15. It's on File In A College Library

I'll have to find out if it can be linked. I haven't taught a class there for years.
The Professor

[indepat]

16. IMHO Repugs since Reagan have known this, but want to starve the beast

to have the excuse to dismantle all New Deal initiatives and other safety nets: the only welfare is to be for corporations and the most affluent who again, IMHO, would rather have 95% of a much smaller pie than 90% of a much larger pie. But then, what do I know?

[ProfessorGAC]

17. You Obviously Know Something!

You figured out that they are selfish and shortsighted! So, you MUST know somethin'.
The Professor

[Boo Boo]

13. Gee whiz, NABE...

What was your first clue?

[GOPBasher]

14. Gigantic tax cuts; enormous military expenditures. What do we expect?

This is what Reagan was doing too. But now it's even worse. Our children have a huge debt to pay. Thanks Bush.