Economy vs. Deficit Reduction

According to many here and nationwide, the biggest issue facing our country is the deficit. Sequestration has been imposed to reduce the deficit, and the GOP is pushing for even more cuts that supposedly will reduce the deficit even more. Yet little attention has been focused on growing the economy. These two issues are for the most part mutually exclusive as history has shown time and time again. The Harvard study that Ryan and other deficit hawks have cited as the basis for their budget plan has been shown to be deeply flawed in it's conclusion that high deficits prevent economic growth. I certainly have my opinion that growing the economy has to come first in order to reduce the deficit and it should the top priority. What are others thinking and why?

Something the Dog Said wrote: According to many here and nationwide, the biggest issue facing our country is the deficit. Sequestration has been imposed to reduce the deficit, and the GOP is pushing for even more cuts that supposedly will reduce the deficit even more. Yet little attention has been focused on growing the economy. These two issues are for the most part mutually exclusive as history has shown time and time again. The Harvard study that Ryan and other deficit hawks have cited as the basis for their budget plan has been shown to be deeply flawed in it's conclusion that high deficits prevent economic growth. I certainly have my opinion that growing the economy has to come first in order to reduce the deficit and it should the top priority. What are others thinking and why?

Well... Obama is doing neither.

The Liberals GOP Twin wrote:

Something the Dog Said wrote: According to many here and nationwide, the biggest issue facing our country is the deficit. Sequestration has been imposed to reduce the deficit, and the GOP is pushing for even more cuts that supposedly will reduce the deficit even more. Yet little attention has been focused on growing the economy. These two issues are for the most part mutually exclusive as history has shown time and time again. The Harvard study that Ryan and other deficit hawks have cited as the basis for their budget plan has been shown to be deeply flawed in it's conclusion that high deficits prevent economic growth. I certainly have my opinion that growing the economy has to come first in order to reduce the deficit and it should the top priority. What are others thinking and why?

Well... Obama is doing neither.

Exactly, and because of it companies are not hiring or investing instead they are sitting on billions of dollars

http://seekingalpha.com/article/1284091 ... -idle-cash

Government can't grow the economy with deficit spending. If past history has taught us anything, it certainly should have taught us this.

The tax capacity of the Union post WWII has averaged 18% of GDP. Regardless of tax rates, regardless of tax deductions and credits, regardless of what is being taxed, the federal share of the GDP of the Union has averaged 18% in tax revenues over the course of 70+ years. The federal government simply can't spend 24% of the GDP when they can't hope to ever collect that much in tax revenue, that's the bottom line. The tax revenue will not sustain the federal government consuming one quarter of the entire economic output of the Union.

It might be different if the public was receiving some tangible benefits for the expenditure of public funds to sustain the welfare of individuals who have been impacted by the economic downturn, but that isn't the way that federal welfare programs are set up to function these days. There is no tangible benefit attached to the trillions of dollars that are spent every year providing individual welfare via the federal government. Those who receive those funds should be returning some value to the providers of those funds. The recipients should be replacing old water or sewer pipes, filling in potholes, sweeping the streets, shoveling snow, picking up trash, fight fires in the forests, rebuilding trails in the national parks or doing maintenance on public buildings along the lines of what the CCC did. Return useful work for the funds provided, which lowers the cost of government both now and in the future. Simply handing someone 99 weeks of charity because they lost their job ain't going to get the job done, as current policy has made abundantly clear already. Trillions of dollars are going out and nothing of value is being purchased with those funds. That has to change.

Europe is doing austerity right now and unemployment is rising. Part of the austerity is raising taxes on the rich. Think the US should do that too?

FredHayek wrote: Europe is doing austerity right now and unemployment is rising. Part of the austerity is raising taxes on the rich. Think the US should do that too?

Unemployment in Spain is now 27%. Higher taxes do not encourage growth.

The Left? The goverment will spend your money better than you will, so give them more!!!!
True Keynsian thinking? Increase the money supply to increase spending, so it doesn't make sense to raise taxes, but Obamacare is doing it anyway.

FredHayek wrote: Europe is doing austerity right now and unemployment is rising. Part of the austerity is raising taxes on the rich. Think the US should do that too?

Really... how did that work for Hollande?

Hollande, during last year's presidential campaign, proposed a 75% tax rate on individual income above 1 million euros. The controversial tax was rejected by France's judiciary.

Hollande made his new payroll tax proposal on big salaries during a late-night television broadcast. "The Constitutional Council made a decision," Hollande said. "I respect it. So, I'm going to take a different path."

http://money.cnn.com/2013/03/29/news/ec ... index.html

And... "French President Francois Hollande's popularity rating slumped six points in a month to hit 25%, worse than his predecessor Nicolas Sarkozy's lowest ever score, a survey said."

http://www.hindustantimes.com/world-new ... 47957.aspx

Interesting. If the Obama tactic of war on the rich doesn't work in socialist France, what hope do the Dems have in 2014?

And Obama wants to tax every pack of smokes with another $0.94, which amounts to another tax on the poor and middle class.

Forget about the massive government waste, just increase taxes.

http://money.cnn.com/2013/04/10/news/economy/cigarette-tax/index.html