Wednesday, January 7, 2009

Stimulus aside, Obama vows future budget restraint



Obama balances massive stimulus with talk of long-term budget belt-tightening


As long as fiscal conservatives continue to have a vice grip on economic policy, we will repeat, endlessly, this pattern of several years' recovery followed by slump or crisis because of fiscal drag. Keynes called it, "Running in a state of perpetual, semi slump."

Read story here.

2 comments:

cuOnTheOtherSide said...

For the last 8 years the government has provided tax cuts and increased debt.

On your show you mention that Bush changed course in his last 4 years.

If I understand you correctly in the fist 4 years Bush practice Mike Norman style economics and fiscal conservative economics in the last 4 years.

Mike Norman said...

In Bush's first term there were tax cuts and the government added to the financial net worth of the non-governmental sector (public) at a fairly rapid pace. In his second term Bush was more concerned with fiscal discipline and the deficit fell to 1.2% of GDP, nearly removing all fiscal stimulus at a time when household financial obligations relative to income were at a record high.