September 18, 2018

MAKING IT RAIN WHILE THE SUN SHINES:

Government borrowing soars despite robust economy (Damian Paletta and Erica Werner, September 11, 2018, Wasington Post)

The U.S. budget deficit is reaching levels that are abnormally high for a robust economy, and lawmakers from both parties are proposing ideas that would make the deficit swell even further.

The government spent $895 billion more than it brought in from taxes and other revenue sources during the past 11 months, the Congressional Budget Office said this week, a 33 percent increase from one year before.

Typically, the deficit shrinks during strong economic times, as the need for costly government support wanes and tax revenue rises. In 2000, the last time the unemployment rate was at its current level of 3.9 percent, the government ran a surplus, meaning tax revenue eclipsed all spending.

In fairness to the GOP, a balanced national budget is not an economic matter, but an aesthetic one. In normal times, it demonstrates that government is functional.

To the extent, then, that the party despises government, a functional one is problematic.  

Posted by at September 18, 2018 11:22 AM

  

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