Wednesday, June 10, 2009
Perfect record for Bloomberg journalists getting it wrong again!
This time it's Caroline Baum. Check out the piece she wrote entitled, ‘Legacy of Debt’ Gives Fiscal Stimulus Bad Name.
This is the email I sent her:
Are the current generation of Americans poorer than the generation who ran up the debt to fight WWII? That debt was far larger in proportion than the current debt, yet we are NOT poorer. Moreover, the top tax rate from 1946 to 1964 was 91%, then it dropped to 77%, which is still more than twice the current rate, yet the economy grew faster than it did following the Reagan tax cuts of the 1980s.
What you don't seem to understand is, to the extent that government spending adds to output and employment that leads to the creation of the real assets that will be used by future generations. That is known as wealth! This is precisely why our grandparents' "legacy of debt" did not bring us down to a lower standard of living.
Yours is just another example of misinformed journalism, which serves only to propagate economic myth and fallacy. That is the real danger to our heirs.