Here we are again. Right back at the edge of the fiscal cliff. I wonder what happened to those colorful words this time around? The term "fiscal cliff" became all the rage just a few months ago.
Government borrowing is not the problem. Incidentally, Congress will raise the debt ceiling, but probably not for a few more days. We haven't had enough political theater just yet.
Just like you and me, governments should borrow sometimes, but only for the right reasons. Borrowing to finance productive activities (like successful businesses do) and borrowing to finance long-lived capital goods (like businesses and consumers do) is just fine --- provided businesses and consumers have reasonable expectations of being able to repay their borrowing. Borrowing to finance continued transfer payments that cannot be sustained is not a right reason for governments to borrow. What is hard to understand about that proposition?
More than two years ago, EconoBlast featured an article that seems completely timely today. So, at the risk of boring regular readers, I point today to the EconoBlast archives. You will find the article here.
Lot's of digital ink will flow over the next several weeks as Congress continues NOT to do its job. Until Congress gets to the business of why we have Congress at all, the United States and the rest of the world will face the plunge. It's a long way down, Mr. Speaker and Mr. President. You both should be saying "not on my watch."
Government borrowing is not the problem. Incidentally, Congress will raise the debt ceiling, but probably not for a few more days. We haven't had enough political theater just yet.
Just like you and me, governments should borrow sometimes, but only for the right reasons. Borrowing to finance productive activities (like successful businesses do) and borrowing to finance long-lived capital goods (like businesses and consumers do) is just fine --- provided businesses and consumers have reasonable expectations of being able to repay their borrowing. Borrowing to finance continued transfer payments that cannot be sustained is not a right reason for governments to borrow. What is hard to understand about that proposition?
More than two years ago, EconoBlast featured an article that seems completely timely today. So, at the risk of boring regular readers, I point today to the EconoBlast archives. You will find the article here.
Lot's of digital ink will flow over the next several weeks as Congress continues NOT to do its job. Until Congress gets to the business of why we have Congress at all, the United States and the rest of the world will face the plunge. It's a long way down, Mr. Speaker and Mr. President. You both should be saying "not on my watch."
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