Quote Originally Posted by Kirkland Laing View Post
America doesn't have a spending problem. It has a depressed economy problem. If the economy was returned to normal growth revenues would increase and wipe out the deficit. Since 2008 there's been an almost trillion dollar a year drop in demand caused by the 2008 bursting of the housing bubble. Replace that demand and you end the deficit toat least a level that is infinitely sustainable.

And that's why Obama's soon-to-be-revealed plan to keep all current spending unchanged and to spend an extra few trillion dollars over the next four years is such a good thing. The private sector aren't going to invest as there's already massiver existing overcapacity in the economy so they don't need to. The only thing that can return the exconmy to normal growth and end the deficit problem is massive extra government sdpending.
Correct me if I'm wrong but doesn't "bubble" suggest an artificial/unsastainable level? Wasn't the burst a market correction of tons of sub-prime loans being packaged into investments and then fast and loose work in the derivatives market? Even if I agreed that large deficit spening was the answer it would seem unwise to try to boost the economy back to a level it couldn't sustain before, especially to try to do it in a short timeframe. I don't think there is a fast or easy way back to 2007 revenues or debt/deficit reduction.