Spending is the problem, yet Wall Street gets spooked by any effort to really cut spending back even to the levels of 5 or 6 years ago. We have to cut spending, period. Then we have to cut it again and again. Our society is addicted to the heroin of government spending. It has to be cut. The irony is that Wall Street seems to think that money is taken out of the economy if the government stops spending. It isn’t. It is just spent by private persons. Even the debt — instead of buying bonds or T Bills, the investor invests in something else. Something productive. This is all so clear to me anymore. You either pay people to not be productive (ie, government spending) or you put money to work in the private sector to invent new products and services to better everyones’ lives. Government spending is a real drag on the improvement of our society.
—Spending is the problem...—
And the REAL problem is that the government spending is so large that the “real” economy has a symbiotic relationship with it. Cut government spending enough to matter, and you ding the economy. It becomes a positive feedback loop, spiraling all the way to the bottom. The time for any “planned” solution has long passed. We are at the point in a head on auto accident where you just instinctively push your hands forward to stop the truck coming at you from passing into your face.
It really is not gonna help. It’s gonna hurt. A lot.
What do you expect with economists like Reich and Krugman.
To be accurate, only a portion of our society is addicted. Personally, I would not shed a tear if Welfare were eliminated. Along with the EPA, FDA, BATFE, IRS and on and on and on. There are so many programs that are useless that clearly half of the current government could be trimmed away and no one would notice. Except those who would now be forced to find REAL work and those who suck at the teat.