This is a good piece that might keep the blood pressure down — if Congress fails (again) to provide any real budget and sequester takes over.
The Economist piece concludes:
But the sequester involves the application of Keynesian considerations to decidedly sticky budget line items. Where the payroll-tax cut could quite reasonably be expected to lapse as the economy improves (before it improves enough, as it happens), we can’t count on defence cuts being back on the table in a few years. Taking that into consideration alongside the Fed’s recent actions I’m not at all convinced that the sequester hitting would be a net negative for America. It’s not the policy I’d choose. But that is basically never a realistic possibility.
I think this makes pretty good sense.
Yes, there are plenty of Chicken Littles on both sides of the aisle. The left is concerned with hurting the poor and unemployed. And others are more concerned about defense cuts being snatched from their districts.
I get that, but….
We need to start cutting spending sooner rather than later. And yes, I want to see changes to Medicare implemented now even if they don’t take effect until geezers like me are elibible in 10 years.
However, we don’t need to pull the rug out from under the wealthy and the businesses and entrepreneurs that will hire. This is a recovery; fragile, yes, but still a recovery.
There’s this funny thing called balance that Washington fails to understand.
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