Tuesday, March 15, 2005

Greenspan Maxed Out

MaxedOutMama analyzes the recent testimony to Congress by Alan Greenspan and concludes that Paul Krugman (who is supposed to be an economist, but is really a less articulate version of Maureen Dowd, with an academic degree) is deluded.

The budget deficit can't improve unless major action is taken.

But, as the latest projections from the Administration and the Congressional Budget Office suggest, our budget position is unlikely to improve substantially in the coming years unless major deficit-reducing actions are taken.
Congress doesn't have enough self-control to do it, so legislation to force a balanced budget is necessary:

In my judgment, the necessary choices will be especially difficult to implement without the restoration of a set of procedural restraints on the budget-making process. For about a decade, the rules laid out in the Budget Enforcement Act of 1990 and in the later modifications and extensions of the act provided a framework that helped the Congress establish a better fiscal balance.

But that's not enough either:

I do not mean to suggest that the nation's budget problems will be solved simply by adopting a new set of rules. The fundamental fiscal issue is the need to make difficult choices among budget priorities, and this need is becoming ever more pressing in light of the unprecedented number of individuals approaching retirement age. For example, future Congresses and Presidents will, over time, have to weigh the benefits of continued access, on current terms, to advances in medical technology against other spending priorities as well as against tax initiatives that foster increases in economic growth and the revenue base.

Check it out. I couldn't agree with her more--either about the unsustainable spending or about the la-la Democratic reactionaries.

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