How Will Obama’s Deficits Be Financed?
Paul Craig Roberts
15 Febbraio 2009
Who remembers economists’ hysteria over the "Reagan deficits"? Wall Street was in panic. Reagan’s fiscal irresponsibility was bringing the end of the world.
The fiscal year 2009 federal budget deficit that Obama is inheriting, and adding to, will be ten times larger in absolute terms than Reagan’s biggest and a much larger share of GDP in percentage terms. Yet, economists are sending up no alarms.
Paul Krugman, for example, couldn’t damn Reagan’s puny deficits enough. But today he thinks the deficit can’t be large enough!
The central issue of the stimulus and bailout plans is how to finance the massive budget deficit. This issue remains unaddressed by economists and policy makers.
As far as I can tell, the government, its advisers and cheerleaders think financing the deficit will be a cakewalk, like the Iraq War.
I am tempted to claim …
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