I'm surprised such a large array of experts failed to mention some key points in this letter. Economic recession was already beginning as Bush took office - the bursting of the internet bubble certainly wasn't Bush's fault. Most of the deficit is the result of the economic downturn. Although it mentioned 9/11 the letter did not account for the $100 billions we are now paying for War on Terror. How could this not be inconsequential to current deficits? It also did not take into account rising oil prices. Nor did it account for corporate accounting scandals. The letter implies that the only thing affecting our deficits right now is the Bush tax cut. Now I would agree, that a tax cut without corresponding spending cuts is not fiscally responsible. However, I think even Greenspan has come out recently and said that the economy is robust and growing, and would be growing more if oil prices were lower. If memory serves, I think he even said sometime this year that the tax cuts have helped reverse the recession. Also I thought there were two contradictory objectives suggested in the letter: income redistribution (tax the rich more to lower the income gap) and spurring the economy (how does taking $, aka income, out of the economy and into the government spur economy?)
It's entirely possible that the professors did consider your points, and included them in their thinking, but not in their short letter.
Interestingly (maybe) I've been reading a book called America the Broke and just last night I read the chapter called "Anticipating the Critics." The book argues that we must act immediately to end deficits and reduce the national debt or we face global economic turmoil. It seems pretty non-partisan, but, as they say, your mileage may vary. It is not kind to Bush or the current Congress.
In this chapter, the author answers both your points above (except for the oil, but I'll come back to it). I got my scanner working in Linux, but I couldn't get OCR to work well, so here are the relevant page images (they are about 200-300K each for easy reading):
pg. 137pg. 138pg. 139pg. 144pg. 145As for high oil prices, the author argues that they are in part due to the weak dollar (down significantly versus the Euro over the last few years) (oil is traded in dollars only), which is another result of high debt. The author also argues that at the expected rate of increase of SS and Medicare/Medicaid, no economy can grow fast enough to keep up. I'm not really capable of summarizing this quickly (I'd have to re-read it for one thing!), but if you are interested you should look into the book.
Finally, the book was published this summer, so some of the numbers have been revised (e.g. 2004 deficit was revised down from early estimates).
I'm surprised such a large array of experts failed to mention some key points in this letter. Economic recession was already beginning as Bush took office - the bursting of the internet bubble certainly wasn't Bush's fault. Most of the deficit is the result of the economic downturn. Although it mentioned 9/11 the letter did not account for the $100 billions we are now paying for War on Terror. How could this not be inconsequential to current deficits? It also did not take into account rising oil prices. Nor did it account for corporate accounting scandals. The letter implies that the only thing affecting our deficits right now is the Bush tax cut. Now I would agree, that a tax cut without corresponding spending cuts is not fiscally responsible. However, I think even Greenspan has come out recently and said that the economy is robust and growing, and would be growing more if oil prices were lower. If memory serves, I think he even said sometime this year that the tax cuts have helped reverse the recession.
Also I thought there were two contradictory objectives suggested in the letter: income redistribution (tax the rich more to lower the income gap) and spurring the economy (how does taking $, aka income, out of the economy and into the government spur economy?)
It's entirely possible that the professors did consider your points, and included them in their thinking, but not in their short letter.
Interestingly (maybe) I've been reading a book called America the Broke and just last night I read the chapter called "Anticipating the Critics." The book argues that we must act immediately to end deficits and reduce the national debt or we face global economic turmoil. It seems pretty non-partisan, but, as they say, your mileage may vary. It is not kind to Bush or the current Congress.
In this chapter, the author answers both your points above (except for the oil, but I'll come back to it). I got my scanner working in Linux, but I couldn't get OCR to work well, so here are the relevant page images (they are about 200-300K each for easy reading):
pg. 137pg. 138pg. 139pg. 144pg. 145As for high oil prices, the author argues that they are in part due to the weak dollar (down significantly versus the Euro over the last few years) (oil is traded in dollars only), which is another result of high debt. The author also argues that at the expected rate of increase of SS and Medicare/Medicaid, no economy can grow fast enough to keep up. I'm not really capable of summarizing this quickly (I'd have to re-read it for one thing!), but if you are interested you should look into the book.
Finally, the book was published this summer, so some of the numbers have been revised (e.g. 2004 deficit was revised down from early estimates).
I am constantly frustrated by the inability of my browser and/or blogger comments to correctly interpret my html the way I want.
Sorry for the unspaced page links. I'll have to figure out what I am doing wrong one of these days...
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