Freeper: "Deficits into eternity are not a bad thing"

[laura888]

Just had a discussion with a freeper over the fact that not one Repub president in the last 30 years has cut spending, just increased the deficit.

The defense I got was that deficits were not a bad thing. I said "in limitation, right- its gotta stop sometime, right? They can't just keep getting higher and higher, right?"

No, the answer was that deficits can go on an on, and this would be fine as long as consumers had extra $ to purchase humvees, etc.

Is this voo-doo economics?

[eileen_d]

1. It's "poo-poo" economics

I wish you could have recorded that conversation, play it back to the freeper in question 24 hours later. Ask if it still makes sense

[splatbass]

2. The real reason they like deficits

is that it gives them an excuse to cut social programs. With the surplus we had when Bush took over they couldn't really say we needed to cut spending, but with deficits it gives them the perfect excuse. They will always run deficits for that reason.

[Davis_X_Machina]

3. Although at some point the US..

...will have to inflate all that debt away, or default on it.

So this freeper will have a hell of a party -- until the economic equivalent of the meteor hits.

What a dumbass. I hope my bank didn't issue his credit cards.

[laura888]

4. you lost me...

... how can you legitimately cut social programs when there's a deficit? Can't you only do that when there's a surplus?

What am I missing?

[Scaramouche]

5. Don't they realize that large deficits erode...

the effectivness of the tax doollar. After awhile a large part of the Governments income, i.e. taxes, goes to servicing the debt. For some, i.e. holders of vast amounts of treasure bills, this is a great thing.

Another side-affect is that large amounts of investment capital gets tied up in financing the debt rather in more risker ventures like new start ups or infrastructure enhancements. When intvestment capital gets squeezed eventually interest rates rise. Also, we become dependant on foreign investment to finace our national debt.

This has one effect of foreign countries not financing the own capital projects by seeking refuge in US investments. Furthermore this could put us at the mercy of any coordinated effort to created a finacial crisis through market maniputlation.

Strange, but not unexpected, those benefitting the most from the Bush tax cuts are buying tresury bills rather than creating new jobs. So over time there will be a transfer of wealth in an upwards direction...