[Steve_American]

5 min. long.

Moody's has 3 sscenarios for the debt celing crisis.
1] A sgort default. They say this will cause 1M more unemployed and a mild recession.
2] A longer default. This will cause 7M more unemployed and a deep recession with a 20% drop in stock prices.
3] The Repuds get their way and there are sort of deep cuts in Gov. spendng, but nowhere near enough to balance the budget. This will cause 2.6M more unemployed and it delays the recession until 2024 just before the election, so the Repuds can blame Biden for the recession.

It says it's unavailable, so copy and paste the address to your browser and remove the "[==]" to see it.

https://www.you[==]tube.com/watch?v=YB3Dg3CGZZg&list=TLPQMTEwMzIwMjPb_NsMFKGw8Q&index=4

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[Puffer Fish]

Spending cuts are worse than short default

But then you have to ask yourself HOW did the U.S. get here? Where it has to keep spending more money than it takes in in taxes?

Could it be because maybe the U.S. kept running big budget deficits even during the better times?

[Steve_American]

But then you have to ask yourself HOW did the U.S. get here? Where it has to keep spending more money than it takes in in taxes?

Could it be because maybe the U.S. kept running big budget deficits even during the better times?

I'm going to guess that your question results from what you think is true. [This being that it was a good thing under the gold standard that the Gov. always had to protect its gold supply, by cutting spending in the good times, and even having a surplus in the good times, so over the business cycle the money supply didn't grow at all.] You completely ignore the ecoomic history from 1929 until 1969. During that time period the money supply massively grew. 1st because of the depression and then 2nd because of WWII, and then 3rd, during the post war boom. The gold standard was still in place and yet thee money supply went way, way up, with no problems until France went after the American gold supply, and OPEC got mad at the US over the Yom Lippur War and cut oil exports to the US and Europe. The rsulting shortages caused a lot of infation.

IMHO, spending cuts being bad now is a result of previous spending cuts, having already cut all (and more than all) the waste and fraud. Even you can see that this point exists at some level, right?

AFAIK, the corps have cut real wages so much that only Gov. programs that provide income or income like support (food stamps) are keeping the economy going. WalMart teaches new employees how to get welfare and sees to it that they don't earn too much to qualify. That is, WalMart sucks money from the Gov. by not paying a living wage.

So, IMHO, the large deficit is the result of too many tax cuts for the rich.

The golden age of the American economy was from th mid-30s unti the mid-60s when the top tax income tax bracket was taxed at 90%. And corps were taxed much more also. So, the 90% rate didn't crush the economy.

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[Steve_American]

I'm going to guess that your question results from what you think is true. [This being that it was a good thing under the gold standard that the Gov. always had to protect its gold supply, by cutting spending in the good times, and even having a surplus in the good times, so over the business cycle the money supply didn't grow at all.] You completely ignore the ecoomic history from 1929 until 1969. During that time period the money supply massively grew. 1st because of the depression and then 2nd because of WWII, and then 3rd, during the post war boom. The gold standard was still in place and yet thee money supply went way, way up, with no problems until France went after the American gold supply, and OPEC got mad at the US over the Yom Lippur War and cut oil exports to the US and Europe. The resulting shortages caused a lot of infation.

IMHO, spending cuts being bad now is a result of previous spending cuts, having already cut all (and more than all) the waste and fraud. Even you can see that this point exists at some level, right?

AFAIK, the corps have cut real wages so much that only Gov. programs that provide income or income like support (food stamps) are keeping the economy going. WalMart teaches new employees how to get welfare and sees to it that they don't earn too much to qualify. That is, WalMart sucks money from the Gov. by not paying a living wage.

So, IMHO, the large deficit is the result of too many tax cuts for the rich.

The golden age of the American economy was from the mid-30s unti the mid-60s when the top tax income tax bracket was taxed at 90%. And corps were taxed much more also. So, the 90% rate didn't crush the economy.

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MMTers would say that it was a bad thing, that it was thought that the money supply could not be increased by Gov. deficit spending every year.

MMTes see the resulting private increases as worse that public debt increases.

They (increases in private debt) are often the cause of recessions.

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